Donna Arduin, a prominent state budget management and tax reform expert who was an early figure in the Dunleavy Administration, has uncovered possible fraud at the Kennedy Center for the Performing Arts.
The Kennedy Center is under scrutiny after she found internal documents that revealed a pattern of deficit spending and accounting practices that could prompt legal action. The revelations, first reported by The Daily Wire, point to alleged fiscal mismanagement during the tenure of recently departed president Debra Rutter — mismanagement that current leadership now describes as “criminal.”
Kennedy Center President Richard Grenell informed the board of directors this week that the organization uncovered $26 million in “phantom revenue” embedded in its fiscal year 2025 budget. “It’s criminal,” Grenell said, to The Daily Wire, adding that the findings would be referred to the U.S. Attorney’s Office for investigation.
The allegations center on claims that Rutter and her leadership team fabricated revenue to balance the budget, misleading the board and jeopardizing the institution’s financial integrity. Rutter has denied the accusations, telling The Washington Post that the board approved every annual budget her team submitted.
However, Kennedy Center Chief Financial Officer Arduin, who joined the institution earlier this year, disputed Rutter’s defense in a letter obtained by The Daily Wire. Arduin, a high-profile budget expert with national experience, pointed out that audit processes and budgeting are on entirely different timelines and that audits do not validate budgets retroactively.
“Budgets and audits are on vastly different timetables and audits do not review the budgeting process,” Arduin wrote to Grenell. “Audits are released up to a half year after the conclusion of the fiscal year, whereas budgets are approved well in advance of the fiscal year.”
Arduin has a long record of strong fiscal leadership, having served as budget director in several states, including Florida under Gov. Jeb Bush, was well as New York under Gov. George Pataki, and California under Gov. Arnold Schwarzenegger. In Alaska, Arduin briefly served as Gov. Mike Dunleavy’s budget director in 2019, where her cost-cutting proposals triggered leftists and the mainstream media. Because the Legislature did not follow her recommendations for drastic budget reductions, Alaska now faces the fiscal crisis that she predicted it would encounter. Legislators take more and more of Alaskans’ Permanent Fund dividends and try to push taxes onto Alaskans.
At the Kennedy Center, Arduin concluded that the organization’s fiscal year 2025 budget was deliberately veiled with $26 million in non-existent revenue. “The Board believed that they were in good faith passing a balanced budget,” she wrote.
In March, Arduin informed her fellow senior executives the Kennedy Center had “no cash to pay our bills.”
Beyond the fictitious revenue she unearthed, Arduin also detailed a concerning reclassification of donor-restricted funds. According to her letter, the Kennedy Center’s leadership under Rutter renamed a $54 million debt reserve, originally designated for retiring a bank loan, as a “sustainability fund.” The name change allegedly created the illusion of newly raised funding and allowed the reserve to be used to cover operational deficits.
The Daily Wire has the story at this link.
I recall Donna was a real scapegoat in Alaska for trying to bring a dose of reality to the budget process. But her hard, yet realistic findings were poo poo’d by many in the legislature, some of whom are still there, as well as financially liberal citizens. So she was driven out of the state on a rail and the Governor was bashed for employing her. Too bad.
No surprise here. I think all those “centers”, or whatever they’re called, that operate as non-government organizations but funded by taxpayers are fraudulent, especially if they’re run by democrats.
It’s called culture. Look it up.
Hopefully they will shut it down so that we don’t have to endure the cr*p shows that Trump, the Man in Charge, will book there.
LMAO
Cry harder.
😢😢😭😭😭😭
I’m sure that Kid Rock and Ted Nugent will suffice as performers at the Kennedy Center for the next 4 years.
Another Trump shill. Learn how non-profit arts organizations work, Donna, I’ll wait… Everyone wants to be another Woodward and Bernstein. There are no receipts on this one. Nice try. Trump has placed unqualified people in every position. The Kennedy Center used to be the crowned jewel of American Culture, not it is soiled, just like everything else Trump has touched.
Elwood: I think what Arduin found was that the past directors were spending more that funds coming in, so the former folks in charge decided to rebrand an endowment fund and then raid that savings account.
In other words, the past directors were over-driving their headlights.
There’s a lot of that going on in Dee Cee and other places, including Alaska.
We spend too much and essentially borrow from the future while ignoring obvious lessons from the past.
I’m satisfied President Trump found an adult in Arduin to get the Kennedy Center finances back in a sound foundation.
Best of luck to her.
You can tell she’s a budget rock star. If she were an expensive rock star, she would have much bigger hair, and some cool tattoos.
“rock star”—Sure, if she were an asteroid that practically wiped out several key government services. (Ohhh, he’s a “financially liberal citizen”: I guess so, if that’s what you mean by a functioning ferry system, university system, supported municipalities, etc.
CAM: Do remover it was Governor Dunleavy and his Chief of Staff that made the decision to try and adopt the massive cuts in a single year.
Those gents were responsible, not Arduin, for how various spending reductions were implemented.
Yeah, yeah, I know she got blamed for the cuts and the predictable political fallout after Dunleavy and Babcock did a hatchet job on the budget. Blaming the girl for woes rendered by a guy is a very old and cheesy tactic. e.g., Marion Berry’s defense in the press when he got busted.
The reality exists that Arduin did indeed lay out a path of fiscal sustainability in Alaska during Dunleavy’s first term and he was scared out of pursuing it for political reasons, due to the media attacks on Arduin. Alaska will indeed go the way of Venezuela, as the state will soon run out of other peoples’ money. The worst part of this tale is, the most affluent members of Alaska’s population refuse to stand up and do anything about it by supporting conservative policies.
Ruby’s got it right here regarding Governor wimping out on reductions.
Heck, all the Governor needed to do was insist on a 6% cut in base spending his first year and stick with that kind of reduction each year.
Think about a 6% reduction every year sinchbGivetnor Dunleavy’s been Alaska’s chief executive. We’d be a much leaner and very possibly more efficient state government by now. Instead, Governor Dunleavy continues to preside over a bloated and inefficient bureaucracy that still had pork d out nodes like AIDEA and entities like the Alaska Energy Authiity, both of which are presided over by political hacks with no demonstrated ability to improve Alaska’s economic prospects.
We get what we deserve by electing officials who hire pals and feather merchants.
Radio City Music Hall, privately funded and constructed. Kennedy Center 100% federally funded construction and paid for by taxpayers that never even see it. it has always struck me that there are people that express a need for the “arts” and the sustainability of venues that believe it is MY money that must sustain THEIR place to gather. If a group of people wish to have such a venue, they should be willing to pay for it.
👍🤜🤛👏