Wall Street struggles being felt in fine arts community

Posted 9:16AM on Sunday 20th October 2002 ( 22 years ago )

PITTSBURGH, PENNSYLVANIA - The din on the floor of the New York Stock Exchange may seem far removed from the solitude of a gallery or an aria sung in a hushed auditorium, but in fine arts organizations across America, the bear can be heard. Museums make cutbacks, reduce budgets, lay off personnel. Symphony orchestras search for new donors, new ways to get cash. A theater group pulls back its cast sizes, and a big city opera cuts salaries of its top directors. This is the drama of making the arts work in a slowing economy. Endowments have lost value, and foundations are taking a hit. Corporate donors who could be counted on in flush times are looking at dwindling profits, and shaking their heads. The denouement, well, is anyone's guess. ``The other drops have been short-lived and a recovery has been foreseeable. To have a sustained drop as deep as this without an apparent recovery in sight is far more difficult,'' said Ellsworth Brown, president of the Carnegie Museums of Pittsburgh, where $4 million will be trimmed from the budget next year and an unspecified number of workers are likely to be laid off. It's not that the Carnegie Museums, for instance, haven't done well they had record attendance last year. But since 1999, the value of the institution's endowment has dipped 28 percent, from $250 million to $180 million. The museums draw a small percentage of the endowment for operations, so, less value means less money. ``It's just simple math in the end,'' Brown said. And the figures are pervasive. Americans for the Arts, an advocacy group, says state spending for the arts has dropped following years of growth. In Massachusetts, state funding has been cut 62 percent. Some other states are looking at reductions of as much as 40 percent, said Randy Cohen, the group's vice president of research and information. In Denver, where a percentage of the sales tax helps fund the arts, projected revenues have fallen from $38 million to $35 million, forcing the Denver Art Museum to lay off nine workers, keep other positions vacant and cut a planned four-part lecture series on art history. At the Denver Center for the Performing Arts, the operating budget had to be cut. No performances were lost but ``some of the plays have smaller casts,'' said president Lester Ward. At the Atlanta Opera, corporate contributions were off; so were subscription sales. Facing a deficit of some $800,000, six people were laid off though two are expected to be called back and seven of the organization's top people lost between a week and three weeks of pay. Nonprofit foundations which fund the arts have also been hit, in some cases substantially. The David and Lucile Packard Foundation, for example, made grants of more than $15 million to the arts in 2001. This year, it's only expected to be about $5 million. Next year, said spokeswoman Amy Chamberlain, it will likely be less. Foundations figure how much they have to give based on the value of their endowments, a number determined by averaging a fund's worth over several years. The more bad years there are, the lower the average and the less they can give. Some fine arts organizations with endowments have the same problem, since the amount they can take from those funds for operations are capped. ``Next year, we're going to pick up three stinky years,'' said Brown. ``It has been rather devastating, to say the least,'' said Jim Croft, vice president of finance and administration at The Field Museum in Chicago, where the endowment's worth has dipped from $193 million in 1999 to $155 million now. The museum has tightened its budget and is increasing general admission prices for people from outside the city to $10 per adult, up from $8. At the Solomon R. Guggenheim Museum in New York, officials said attendance is down 25 percent this year, and corporate sponsorship has all but disappeared. As a result, the budget is expected to be cut by about $6 million next year. Already, the museum has cut its hours, gotten rid of a small number of administrative positions and extended one exhibition and postponed another. The Guggenheim has also relied on a partnership with the State Hermitage Museum in Russia and the Kunsthistorisches in Vienna to share resources. So far, say fine arts officials, most of the cuts have been confined to limited programs, not exhibitions, collections or performances. Few people, they say, are likely to notice slightly reduced hours, or the loss of an educational program or camp here or there. Organizations may have to become increasingly creative about where they can cut operations, however, if the bear market continues. Edward Able, president and CEO of the American Association of Museums, said he doesn't expect any museums to close, but believes more people need to know that fine arts institutions don't exist in a vacuum, outside the economy. ``I think the public is unaware of the challenges and the cobbled together funding that keeps our institutions alive,'' he said.

http://accesswdun.com/article/2002/10/188699