Mortier Flew First Class, Made $400,000 at City Opera (Update1)

The New York City Opera, which just reported a $19.9 million deficit in 2008-09, paid Gerard Mortier $400,000 for his stint as part-time general-manager in-waiting.

The tax return for the year ending in June 2009 suggests City Opera’s financial problems remain considerable.

The company had a $11.3 million deficit for the previous year.

Mortier earned a salary of $65,000 and “severance” of $335,000. City Opera hired Mortier in February 2007 when he was still helming the Paris Opera. He was expected to take up his position in New York in September 2009.

Instead, the Belgian celebrity never arrived and resigned in November 2008, saying City Opera’s budget cuts amid the global financial crisis prevented him from fulfilling his vision.

The severance payment, a surprise, appears on the return along with smaller payments to departing executives -- among them the artistic administrator, Robin Thompson, and the executive director, Jane Gullong.

Mortier and the City Opera board, led by Susan Baker, “mutually agreed that it was not possible to proceed with the plan for Mr. Mortier to lead the company,” a City Opera spokesman, Pascal Nadon, said in an e-mail.

‘Separation Payment’

Hence, Mortier qualified for the $335,000 “separation payment,” Nadon said.

City Opera’s current general manager, George Steel, who took the job in January 2009, earns a salary of $360,000, Nadon said.

The company bought first-class tickets for Mortier as he flew between New York and Europe, according to the tax return. In his final months, he was spending a week a month in New York, a spokeswoman said in July 2008.

Round-trip airfare between New York and Paris on Air France for mid-June costs $15,500, according to its web site.

“I don’t see first class often,” said Becky Klein, a partner with the executive search firm Phillips Oppenheim, of contracts for cultural leaders. “That is an odd one.”

She said the severance was in line with the contracts of leaders at other major cultural institutions.

“His grand plans were not going to fit into the budgetary constraints,” said Klein, who worked with the Metropolitan Opera in naming Peter Gelb as its general manager in 2004.

Deficit

City Opera’s deficit included $9.6 million in investment losses as stocks tanked and a 93 percent plunge in ticket revenue, from $13.1 million to $922,000. The company performed occasionally around the city while canceling its 2008-09 season during renovations of the New York State Theater, now called the David H.Koch Theater. The New York City Ballet, which shares the theater, continued to perform.

For the past two seasons, the opera has been required to provide financial reports to an independent financial advisor and to the New York Attorney General’s office. That was part of a plan approved in April 2009 by New York State Supreme Court Judge Peter O. Sherwood, which allowed the opera to borrow $6.6 million from its endowment, to meet payroll and other obligations. Six months earlier, the company had received permission to reach in for $17.5 million.

Repayment

In an e-mail, Nadon said that repaying the money “is a significant institutional priority and we hope to begin replenishing it as soon as we can.”

A spokesman for New York Attorney General Andrew Cuomo declined to comment.

The City Opera has about 1,000 full-time, part-time and temporary employees, 500 fewer than the Metropolitan Opera, its grander rival at Lincoln Center. The Metropolitan Opera said it would release its tax return in the next few weeks.

(Philip Boroff writes for Muse, the arts and leisure section of Bloomberg. Any opinions expressed are his own.)

To contact the writer on this story: Philip Boroff in New York at pboroff@bloomberg.net.

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