Michael Horne
Plenty of Horne

Pabst Leader’s Salary Far Below Smiley’s

Pabst boss Gary Witt makes less than a third of what Smiley makes. Ald. Bauman questions this.

By - Apr 10th, 2013 03:12 pm
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Downtown Alderman Bob Bauman was talking the other night about the $772,535 annual compensation of Summerfest CEO Don Smiley. “You know who should be making that kind of money?” he asked. “Gary Witt should be making that kind of money.”

Witt operates three theaters in the 4th aldermanic district, so Bauman can be excused his neighborhood bias.

But he also makes a compelling point that with the Pabst Theater, the Riverside Theater and Turner Hall Ballroom, Witt has done much to preserve three historic venues that might otherwise be dead.

The performing arts venues were sponsored (and sometimes subsidized) by Michael Cudahy, who famously bought the Pabst from the city of Milwaukee for $1 in 2002. The Pabst Theater Foundation pays Witt’s $211,543 annual salary for what it lists as his 40 hours work at the Pabst and 20 hours at the Riverside.

Witt receives a $155,769 base salary, a $38,514 bonus-incentive pay and non-taxable items of $17,260, for a total emolument of $211,543.

The “officers and directors set the compensation of the executive director,” according to the 2011 Pabst Theater Foundation IRS Form 990PF. Witt’s bonus is based “on the performance of the organization as established by the board at the beginning of the year.”

Directors, in addition to Witt, are Michael Cudahy, Kevin L. Lindsey (also a director of the Cudahy Foundation, which made grants in the early years to cover the Pabst Theater deficits) and Atty. Randall Crocker, the president of the von Briesen & Roper law firm, and the current Judge Advocate of the Milwaukee Yacht Club. Crocker is also on the board of Cudahy’s Discovery World.

For 2011, the Pabst brought in revenues of $4,153,553 and had expenses (including $1,210,253 “management fee”) of $4,537,128, leading to a $383,575 deficit. Concession income (“beer”) was a paltry $190,924. Performers earned $1,248,914.

Over at the Riverside, revenues of $6,263,036 outpaced the $6,234,312 expenses, leading to a $28,724 profit, buoyed by $884,833 in concession income. Performers there took home $3,106,580.

We were not able to find the annual revenue for Turner Hall, but there’s no doubt the total revenue of the three venues would be far below Summerfest, which brought in 2012 revenue of $33.8  million, with expenses (including that giant salary) of $26.8 million. Size of the operation is normally a significant factor in setting salaries. Still, Bauman’s point does provide an interesting context from which to view Smiley’s salary, an issue I suspect is likely to get more discussion in town.

Fun Fact, Yacht Club Edition

Randall Crocker, the current Judge Advocate of the Milwaukee Yacht Club, acts as “legal advisor to the board of directors.” The Yacht Club also appoints a Historian, a Librarian and a Fleet Surgeon, who is probably the doctor member with the biggest boat and best-stocked bar.

Keeping it in the Family

Will’s Roadside Farm Market, Inc., has sold its 83,846 sq. ft. property at 5500 W. Silver Spring Drive to Growing Power, Inc., in a less-than-arm’s-length deal. The property has over 25,000 square feet of greenhouse space dating from 1949 to 2010, and with market rental rates ranging from $.45 to $2.38 per square foot.

Will’s Roadside Farm Market, Inc. was incorporated in 1993 by William E. “Will” Allen. Allen is also the incorporator and operator of Growing Power, Inc., which the urban agriculture pioneer founded in 1997.

The Silver Spring property, which is tax-exempt, is the headquarters of Growing Power, “a national non-profit organization and land trust” promoting urban agriculture.

A Note From A Reader – Meijer CEO Writes

Last week, Plenty of Horne interviewed Sen. Tammy Baldwin, and tossed in a few items about the late Sen. Arthur Vandenberg and his gay son, Arthur Vandenburg Jr., a friend and adviser to Dwight Eisenhower whose career was ruined when J. Edgar Hoover revealed Vandenburg Jr.’s homosexuality to the president-elect.

This observation prompted a message from across Lake Michigan from Hank Meijer, the billionaire CEO of Meijer’s, the grocery superstore chain that recently withdrew plans to construct a store in Franklin as its first Wisconsin outpost.

Meijer is working on a biography of Sen. Vandenberg, who, in his opinion, is perhaps the most overlooked figure of his political generation.

Meijer, like Vandenberg, is a former reporter, and he has spent his free time researching the life of his fellow Grand Rapids resident. In the letter to Plenty of Horne, Meijer relates a Milwaukee-based incident involving Eisenhower and his failure to stand up to Sen. Joe McCarthy.

Dear Michael,

Enjoyed your blog on Senator Vandenberg and Arthur Jr. I have been working on the Senator’s biography for too many years. Didn’t know if you’d run across the ironic fact that Arthur Junior’s godson was the late Dudley Clendenin, NY Times editor and author of Out for Good, the first history of gay rights in the U. S. Clendenin’s father and Arthur Junior were friends in the Army Air Force during World War II.

Arthur Jr. was also among those friends of Ike who complained about Eisenhower’s failure to criticize McCarthy while campaigning in Milwaukee after McCarthy attacked General [George C.] Marshall. Marshall and Senator Vandenberg were good friends. I’d like to think that, had he lived, Vandenberg might have been the one Republican with the stature to take on and tamp down McCarthy. With Van’s illness and death, however, Bob Taft was calling all the GOP shots and giving Tailgunner Joe tacit encouragement.

Best,
Hank Meijer

In the speech referenced above, Eisenhower was in Milwaukee campaigning in October 1952. The prepared remarks of his speech included an implied rebuke of McCarthy:

The right to challenge a man’s judgment carries with it no automatic right to question his honor. … Charges of disloyalty have in the past been leveled against General George C. Marshall. … I know him, as a man and a soldier, to be dedicated with singular selflessness and the profoundest patriotism to the service of America. Here we have a sobering lesson of the way freedom must not defend itself.

However, Eisenhower bowed to his advisors, including Gov. Walter Jodok Kohler, Jr. and did not include the paragraph in his speech. But the prepared remarks, including the McCarthy criticism, had been forwarded in advance to the New York Times, which noted the absence of the McCarthy criticism in the speech as delivered. Eisenhower later said he regretted the incident and his failure to stand up to McCarthy on his home turf.

Horne Speech Tonight

I will be delivering a speech tonight, Wednesday, April 10th as part of my regular series at Shakers Cigar Bar, 422 S. 2nd St. The 7 p.m. address will focus on some late 19th century and early 20th century scandals. I will include the particularly juicy tale of the former Lisette Best, the middle-aged, married, brewery heiress with a 16-year old lover who lived in her 42-room mansion with the rest of the family. When people talked (and did they talk) Lisette had her lover marry her daughter. That didn’t work out when the daughter died, so Lisette’s lover married another of her daughters, while still living in that haunted mansion. Things were so scandalous that the Best Brewery had to change its name — to Pabst. Come on by, and hear the tale!

Categories: Plenty of Horne

2 thoughts on “Plenty of Horne: Pabst Leader’s Salary Far Below Smiley’s”

  1. Mike Bark says:

    I’m fully supportive of the notion that Don Smiley’s salary is news worthy, but this article almost justifies Smiley’s compensation much better than Summerfest did.

    So Witt earns a $211,000 compensation package to run 3 entities that essentially break even (although it’d be interesting to see where the “management fee” goes”) and Smiley gets $700,000+ to run an entity that generates a $7,000,000 operating profit. Sounds like the salary for Smiley is fine.

    Even if that management fee is all profits, Smiley’s operating income % far outpaces Mr. Witt’s. Summerfest at 20% and Witt at 8.2%. Witt’s salary is about 25% of that operating profit (again, assuming the management fee is profit) while Smiley’s is 10%

    Too bad Summersfest didn’t spend much time defending it.

  2. Andy says:

    Mike you stole my thunder… it’s comparing two different sized organizations with two very different financial results. Is Don Smiley’s salary high? I think it probably is a bit… but is it outrageous enough to justify having multiple articles on this site dedicated to making him look like a greedy villain or suggesting he should give back half his sallary so we can return the tax dollars? I don’t think so.

    Most CEO’s and other leadership of non-profit groups tend to take a huge pay cut in compared to what they make in the private sector. If we want the best to run our civic groups then it makes sense we would have to at least make their pay reasonable. In that line of thinking… Could Don Smiley go off and make an even greater amount at a private company? Probably. Could Gary Witt go off and become a CEO at a large corporation? Probably not… Nothing against him, I think he’s a great fit for his role… but how marketable is he beyond that role?

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