LEAKED AUDIO: Kennedy Center President Deployed Lobbyist to Secure $25 Million in Coronavirus Stimulus, But Not a Cent for Workers

The Gateway Pundit has received audio of a video conference call between Kennedy Center President Deborah Rutter, members of their human resources department, and 200 of their employees.

The audio was first obtained by Jack Posobiec of One America News.

As the Gateway Pundit previously reported, the John F. Kennedy Center for the Performing Arts infamously received a controversial $25 million from Democrats in the coronavirus relief package — and just hours later they told their performers and employees that they will not be getting paychecks.

During the leaked conference call, which took place on March 26, Rutter repeatedly makes excuses for why they are laying off their employees despite knowing that they will be receiving $25 million in the stimulus package. She says that the Kennedy Center has been barely keeping their heads afloat for years and that being closed, without the money from the government, would have meant they would run out of cash on May 15.

Rutter also discussed how they deployed a lobbyist to get them the money from the stimulus package, seemingly with no intention of using it to protect the jobs of their staff.

“We are really grateful for this $25 million, but I will tell you that it does not keep us whole,” Rutter says in the beginning of the call. “In fact, the language that Tracy [Henke] worked so closely with all the appropriators on was clear that we needed this just to be able to reopen.”

She continued on to say that “this does not keep us whole along the way. Fortunately, Tracy has really great relationships on the Hill. We have fantastic support from board leadership and all of those relationships and savvy, I will say, is what brought us that $25 million.”

Henke is the center’s Vice President of Government Relations, as of November 2019. She has previously worked in the U.S. Senate, U.S. Departments of Justice and Homeland Security, and the private sector.

Rutter went on to address the fact that there are many people who are very unhappy about the amount of money going to the center, when it should be going to places like hospitals.

“Some of you are probably aware of the fact that we are now, uh, the target for a lot of unhappy people who believe that we are taking the money away from sick people. In the case of a stimulus bill, it is to try to continue to do business, and to stimulate the economy in the future,” Rutter said. “In this case, this funding is pretty prescriptive in that it says ‘you need to do this for operational expenses so that you can open up again after this, uh, uh, closure —  this period of time, this closure.’”

“What’s different from previous funding from the federal government is that it will allow us to pay for things that the federal appropriation generally doesn’t — so in this case it will be able to be used for operational expenses, like what it takes for us as a uh, a staff, to be able to uh, uh, make sure that the building is open and ready for programming and activity, after, when we can reopen,” Rutter continued.

Rutter did not specify what they are normally not allowed to use federal funds for, but will be able to use it for this time around.

Our source said that the stimulus is going to the nonprofit portion of the center, and that they already receive federal government appropriations for the building and its maintenance — including the staff that maintains it.  

During the call, Rutter repeatedly apologizes for seeming inarticulate as she clearly attempts to carefully craft what she is saying and the words she chooses.

“I’m sorry that I seem very stumbly and less articulate today, but this is a really really challenging time. I know it’s hard for you, I pray that you all are healthy and safe and I’m grateful for your commitment and I’m grateful for the work that you are doing from home,” she said.

Rutter repeatedly says that the “$25 million does not allow us to maintain our current structure.” Their current payroll, she explains, is approximately $5 million per month, including taxes.

“The baseline cash flow says that if we had not received any cash, and everything stayed exactly as it is today, no changes, we would draw fully on the line of credit, we would be out of cash, on May 15. Couldn’t do anything further. So, with no changes, assuming we could even open on May 15, we would have no cash to do the work moving forward,” she said. “We extended that cash flow all the way through September 30, and um, we would be in arrears to the tune of $32 million. So, again, with the $25 million, and doing nothing, we still would be out $32 million. That’s actually sort of why we were asking, initially, for $35 million from the federal government.”

Rutter said that the center is “right in the vortex of, uh, um, uh, the negative cash flow situation,” but that they have received a spike in transactions, including ticket sales, donations and gift certificate purchases, that come out to around $2.5 million. However, this is still not enough money to continue to pay their employees. She said some of this is money that “is for our programming and some of that is for rental programming where we have been accepting the cash and doing the transactions for those ticket sales,” so they will not actually get to keep that portion of it.

Approximately 17 minutes into the call, Rutter is asked by an employee what the stimulus covers and what it does not. She says there’s very specific language written into the bill.

“It is relatively broad, but as we were working with the appropriations staff, and the senators, and congressional leadership — this was all about being able to reopen. So, we have to be able to have the capacity to open and stay open. It’s not like we can spend the money right now to keep everybody whole and then find ourselves without cash.”

“If we are able to reopen on May 11, we believe our losses, on that kind of income statement, are already 21 million. If we have to stay closed until the end of June that pops up to 30, and if we have to stay closed all the way until September, it’s around a $55 million loss to our institution. So, it’s not just cash that we’re having to address, it’s how we do our business moving forward. So, the stimulus is cash that will help us along the way.”

Multiple employees also asked how they should respond to questions and negative comments on social media. She referred them to the website to find the language that they used.

When asked if employees could donate a portion of their paychecks back to the center to prevent layoffs and furloughs, Rutter said she considered this, but that she couldn’t get to the number they needed. She said that people will take home more money by taking advantage of the unemployment benefits in the stimulus package.

“The more we are learning about the unemployment benefits, it is clear that in some cases it is really going to be more valuable for individuals to be furloughed so that they can collect unemployment instead of contributing back,” Rutter said.

Another employee asked, “so do I understand this correctly, the Kennedy Center got money from the stimulus bill, but it’s not enough to prevent us from having to do furloughs and layoffs?”

Rutter replied, “yes, that is correct. That is why I wanted to start with the cash flow that said, absent that money, coming in we would be out of cash and unable to move forward as of mid-May. That’s why I laid out the specifics of what it is we spend our money on, if we paid nothing else, during that period of time. So, the $25 million will be used to ensure that we can get through this period and open up, and then stay open, and we will have to make some decisions along the way, certainly.”

When asked about the organization’s endowment, Rutter said that they only had less than $100 million, but should have $400 million. “if we did, we would be in a much better place,” she said. “If we had a larger endowment, we could be doing more with those funds today.”

She said that even a big donor couldn’t necessarily save them, because it is an ongoing issue with their budgeting. They recently completed a $250 million renovation and received $41 million from taxpayers in 2019 alone.

The source who leaked the audio said that they are not a disgruntled employee who is doing this to retaliate for a potential layoff or furlough. 

“I am not a disgruntled employee who is upset about layoffs/furloughs,” the source said. “American business and nonprofits are facing tough and uncertain times. I recognize that this is pork. Congress passed an amazing package to assist Americans out of work, and we all need to work to have our own reserves, just like business and non-profits. I am an American who believes that nonprofits need to be sustaining, an American who finds it unconscionable that a nonprofit would state that they need the money for their 6 million/mo operations — which is largely staff — to Congress, the press, and others, and then turn around and start to layoff and furlough all non-essential employees.”

The day after this phone call, President Trump signed the $2 trillion CARES Act, which was meant to support businesses continuing to pay their employees. The bill specifically says the money was meant to “cover operating expenses required to ensure the continuity of the John F. Kennedy Center for the Performing Arts and its affiliates, including for employee compensation and benefits, grants, contracts, payments for rent or utilities, fees for artists or performers.”

In an email to employees that evening, the Kennedy Center told them to assume their last paycheck will be April 3.

“Everyone should proceed as if their last paycheck will be April 3,” an email to employees after the bill passed read. “We understand this will come [as a] shock to all of you, as it did to us.”

One America News will have a segment breaking down the phone call even further airing on Tuesday. We will add a clip of their report to this article when it is available online.


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