Obama Center costs keep climbing
Foundation: $830M needed to build, operate complex in 1st year
Days after City Hall signed legal papers to clear the way to build the Obama Presidential Center in historic Jackson Park for what was seen as a $700 million project — of which $500 million was for “hard costs’’ — the Obama Foundation on Tuesday revealed the price is likely more.
Financial information about the Obama Foundation was disclosed on Tuesday in its annual report and Internal Revenue Service Form 990 covering the year 2020. The foundation also released a list of new donors. The IRS 990 is required to be filed annually by tax-exempt organizations.
The Obama Foundation added two mega donors, with gifts over $1 million, from Bulls legend Michael Jordan and the Open Society Foundations, founded by George Soros.
Among the revelations:
Higher cost estimates
The annual report contained new cost estimates to build the Obama complex and operate it for the first year. Construction started Monday on the center. As part of the deal for getting 19.3 acres in a landmarked park, the foundation had to provide a construction budget to City Hall and guarantee that it had the money, either in cash or pledges.
The Obama Center price has soared through the years.
In September 2018, the foundation estimated the project at $350 million.
By 2019 and through the first part of 2020, foundation officials were calling it a $500 million project. Last June, Obama Foundation president Valerie Jarrett put a price tag of about $700 million on the center.
Behind the scenes, foundation and City Hall officials were explaining the extra $200 million was for so-called “soft” costs, such as interiors and displays, a distinction never previously made.
On Friday night, City Hall, convinced it had accurate estimates, allowed the project to go forward with the foundation putting up $485 million in cash and pledges and a $1 million endowment.
On Tuesday, the annual report stated:
♦ $700 million was “the cost to build the building.” The complex will consist of four structures, a garage and open space.
♦ Another $90 million was “the cost to collect artifacts, design exhibits and prepare the OPC to operate at opening.”
♦ Plus, the foundation said it needed $40 million to operate the center for one year after construction is completed.
Billion dollar fundraising goal
The new 990 report shows that since the foundation was created in 2014, when former President Barack Obama was still in office, the foundation has raised $719.8 million.
The foundation, headquartered in Hyde Park with staff in New York, Washington and California, runs programs around the globe, in Chicago and the rest of the U.S.
In 2020, the foundation gained $171 million in gifts, up from $139.6 million in 2019, according to the 990.
Total 2020 expenses were $40.5 million, down from $54.7 million in 2019.
The foundation reported net assets of $560.6 million in 2020, compared to $429.5 million in 2019.
Going forward, according to the annual report, the goal is to raise $1.6 billion “over the next five years to build and open the Obama Presidential Center, sustain our programming and operations and plan for the future.”
The annual report shows that of the $171 million raised, the Obama Foundation is increasingly dependent on big gifts from corporations and other foundations. They accounted for 58.23% — or about $100 million — of 2020 fundraising, compared to 34.36% of 2019 fundraising and 15.5% in 2018.
Top staff pay
The two highest paid Obama Foundation staff members took voluntary pay cuts in 2020, in order to “account for potential financial impacts of COVID 19 on the Foundation, a spokesperson said.
Here are the totals for the top staffers working all of 2020, according to the 990:
♦ David Simas, chief executive officer: $608,066 in 2020, compared to $657,965 in 2019; $641,846 in 2018 and $614,636 in 2017.
♦ Robbin Cohen, executive director: $551,913 in 2020 compared to $589,971 in 2019; $589,971 in 2018 and $562,055 in 2017.
Grants
The Obama Foundation gives grants to other foundations in Chicago and across the U.S.
In Chicago, the biggest contributions were $100,000 to the Youth Guidance social services organization in the Loop; $67,000 to the New Life Centers for Chicagoland on the West Side; $50,000 to the Lawndale Christian Legal Center; $50,000 to Build, Inc., also on the West Side and $36,000 to the South Shore Drill Team.