Smithsonian tries to Combat a Reputation for Financial Mismanagement

As a mainly federally funded institution, financial misconduct has put the Smithsonian in major hot water. Comprised of 19 museums and galleries, this $1 Billion budget mammoth institution celebrates the fusion of science and art but fails to control the spending of some of its chief officers. All this is about to change, however, with the hiring of the Smithsonian's new Chief Executive Dr. G. Wayne Clough. According to the New York Times, Dr. Clough will take a significant pay cut from the institution's last leading executive in an effort to promote a reputation of more responsible spending.
--
Ashley

Top Ten, okay One, Reason to Diversify Your Revenue Portfolio

Looks like Milwaukee Shakespeare, an organization with a $1.3 million operating budget, is closing its doors. Why? Because it lost its grant from the Argosy Foundation, a major family foundation in the area. Now, that doesn't seem TOO bad, right? Wrong. Milwaukee Shakespeare received 71.15% of its operating budget ($925,000) from the Argosy Foundation every year.

Their website is even sadder. Unfortunately, they did not leave up anything for people to read about the history of the company or anything about the growth they had been experiencing.

Hopefully, this will be a sign (as if there haven't been enough signs!) for organizations to look at their income and make sure they are not overly reliant on one source - even a source that seems permanent.

-- Leslie Fay

Operas and Orchestras make tough decisions due to the economy

The NYTimes has just posted an article about how several opera companies and orchestras are changing their business model, cutting performances, reducing staff or reducing staff benefits due to the bad economic situation. This article is especially interesting because they look at large organizations such as the Met, but also look at the decision some smaller organizations like Michigan Opera. As donors and subscribers are being hit hard financially, companies are projecting lower ticket sales and contributions. However, the most worrying aspect of the problem is that organizations are seeing their security blankets – their endowments – shrinking away. The Philadelphia Orchestra saw its endowment shrink from $220 million to $160 million.

http://www.nytimes.com/2008/10/28/arts/music/28clas.html?partner=permalink&exprod=permalink

--Erika

"Like fiber cereal for the soul"

Charles Isherwood turns the conventional wisdom on entertainment during bleak times on its head this weekend with his musings in the Sunday New York Times:  who says that we're all in the mood for Busby Berkeley musicals and escapism just because the real world currently seems a bit fatalistic?  He argues for the importance and essence of two well-reviewed and thoroughly pessimistic plays (Blasted and Ian Rickson's production of The Seagull, currently on Broadway) over the fluff entertainment that's so gleefully marketed as the happy antidote to reality.  Down with feel-good puff pieces and up with the downers, I say!

-Dana Horst

Arts Administration Anthem

All-

This arts administration anthem is like the glaucoma anthem, except for funky and amazing. Clicking play will give you a pop up, which loads the player, but it looks like an ad. Don't close it or you can't listen.


-- Leslie Fay

Alley Theatre in Houston

Given the media's focus on the nation's current economic woe, I thought it was enlightening to read a positive story about a major regional arts organization.

 

http://www.chron.com/disp/story.mpl/ent/arts/theater/6062941.html

 

Seems this company has made significant positive change in their financial management structure, creating a $1M+ cash reserve in a short two-year period. Also, interesting to note that 29% of their ticket sales are now generated online. Great news.

 

~Mark

A Wholly Subjective Top Ten List

Seattle's alt-weekly, The Stranger, published a list this month entitled Ten Things Theaters Need to Do RIght Now to Save Themselves.  Naturally, no one's agreeing with all of these.   (I love the idea of having drinks at a theater to deepen the relationship between organization and patron, but do you know much a liquor license costs?  And then there's insurance, and noise control, and parking... you get the picture.)  170 comments and still going, people are coming out with suggestions, cheers and jeers, and other highly opinionated contributions.

So:  what's your Top Ten?  What do you think are the most overlooked options that could shore up a theater's bottom line and presence in the community?

-Dana Horst

Signature Theater Goes from 160 to 696 seats

Looks like the Signature Theater in New York finally has chosen a new home - the bottom floor of a 58-story hotel/residential building under construction near Theater Row. The new space has about 5 times as many seats: their previous space was a 160-space theater and the new space has three theaters, one 299-seater and two 199-seaters. All three theaters will be designed by the monumentally famous Frank Gehry.

For some reason, the whole situation reminded me of all the case studies we did in Alan's class with all the various groups moving to overly expensive theatres and completely destroying their financial viability in the process. However, the Signature has done some thinking, in that it passed up two opportunities, one at a cost of $700 million and another at $350 million, before choosing this space, which is expected to cost only $60 million. However, the Department of Cultural Affairs has committed less than $10 million and the board has raised $6 million. The developer has offered a loan on the basis that he expects the operating budget of the organization to more than double when it moves into the new space.

Now, I don't have any financials in front of me, but I would love to see what they have planned to finance this major undertaking or if they will simply end up as another Arts Administration case study of what not to do when dealing with capital campaigns and new real estate. As Alan would probably tell us, you should have all or most of the money raised before you build or buy. Also, you have to seriously contemplate the impact of 5x the seating on your organization! On the outside, this looks like a bad idea on the part of Signature, but I don't know their strategy or their fundraising history. Can they pull it off?

-Leslie Fay

Kansas City Symphony Loses Lawsuit Against the State

How many of you knew that the Kansas City Symphony was suing for funding and did not let the rest of us know about this interesting story? The original story about the lawsuit I found in Playbill from the January 2007!

 

The basis of the lawsuit is that the state is in violation of a statute requiring 60% (originally 50%, but increased) of taxes from out of state athletes and entertainers that worked in Missouri to fund the state arts council. The State supposedly did not invest those monies into the Arts Council and, thus, the whole of the arts scene in Missouri has been adversely affected.

 

Well, turns out that yesterday, a judge threw out the lawsuit, an action that has the Symphony's lawyer saying that this ruling basically means that the Legislature can do whatever it wants with no check.

 

Are times so dire that arts organizations need to start suing states for funding? Or is this a bold move by the Symphony to use their important stature to stand up for all the arts organizations in Missouri who are being short-changed by the state government's breach of promises to fund the arts? Should they appeal the ruling? What will be the outcome and atmosphere in the arts community if they lose? And an even more uncomfortable question: what will be the outcome and atmosphere in the arts community if they win?

--
Leslie Fay

The problem with new opera

This season the Met is presenting John Adam's new opera Doctor Atomic, and in the 06-07 season they presented the world premiere of Tan Dun's The First Emperor, a work the Met commissioned. However, new operas are rare, and a second production of one is even rarer. These days, it seems presenting a new opera is a gamble at best and a liability at worst. This NYTimes article discusses why so many new operas struggle. Although there are many 20th Century Operas I love, Vanessa, Susannah, The Medium, I have always been disappointed with the new operas I've seen. The Tempest was ok, and Miss Lonelyhearts was absolutely terrible. One thing to keep in mind, though, the majority of operas written have always been bad! We just have kept the good ones in the standard repertoire and forgotten the bad ones (and a few good ones too, I'm sure).

--Erika

$10 million for new playwrights

The Mellon Foundation has donated $10 million in grants ranging from $500,000 to $2 million to producing organizations and playwright support organizations (labs and the like) in support of new voices in American theatre. These gifts were prompted by a three-year study of the difficulties that new plays have in getting to the public, most of which include the production part of the equation and not the creating. The article goes in depth into what the different organizations are planning to do with their money, but my favorite is the Public Theatre in New York: they plan on creating a "master playwright" position with New York University to give a playwright a salary, benefits, light teaching duties, and time to devote to his/her art. The article quote Oskar Eustis, the Public's artistic director as saying: "Every theater with a budget of more than $5 or $6 million should support a playwright. That would create 200 playwriting jobs and change the landscape of how we support playwrights." Amen.

--
Leslie Fay

Antiquities Acquisitions and Cultural Preservation

It's no isolated observation that many of the world's antiquities have been looted, repossessed, and generally tossed around the globe by those who had the means to acquire them, legal or not.  (See:  Holocaust-era stolen art treasures from Jewish families and institutions, the recent "missing items" from the Iraqi Museum.) 
Currently, Italy is at the center of another such controversy, and the Colosseum in Rome is holding a massive exhibition that highlights the cultural treasures that have been taken from Italy and returned to the country.  Italy's art-trafficking laws are among the strictest in the world (and oldest, being passed in 1909, before many countries were aware of the cultural looting happening to their art).
Simultaneously, a former cultural minister for Italy is bringing attention to some antiquities up for auction in London that may have been improperly acquired:  Francesco Rutelli is speaking out about the Bonhams auction house's plans to sell some pieces he believes may have been looted from Italy, with the hopes that the Italian government will take action to verify the provenance of these art items.  Bonhams has agreed to immediately withdraw these items from auction if the Italian government can provide documentation proving that the items in question were illegally taken out of the country.

-Dana Horst

It's the Economy.... Again.

The New York Times explores the uncertainty associated with the economy in the arts world through a look at several prominent museums and their programmed exhibitions.  MoMA, LACMA, the Brooklyn Museum, and others are constantly in the planning process for upcoming exhibitions, which includes a significant development effort to finance these exhibitions.  Though they may be years off at this point, the overarching feeling seems to be one of caution and a general "scaling back" from some of the more recent ambitious shows at these major museums.  Added to the pull-back in individual giving forecasted for the upcoming year(s), city agencies are being told to cut budgets, which will necessarily involve decreasing the municipal funding to these fine arts institutions.
Thankfully, some corporate sponsors (Target, UBS, and Bank of America) plan to continue their support for the arts at levels comparable to that of past years.  And as a ray of hope, Michael George, director of LACMA, notes: "Art doesn't lose its emotional or artistic value. That doesn't change no matter what the economy."

-Dana Horst

Interesting Software aiming to help Arts Manager!

Theatre Manager is a software package that will assist the busy administrative operations of a theatre venue, sports facility or arts organization. Theatre Manager's true focus is to assist your marketing efforts ... to help you capture and manage demographic information and present it in a way to grow revenue. Our customers tell us that Theatre Manager has helped them to be successful.

Theatre Manager provides all the necessary controls to track patrons, sell and print tickets on laser printers or high volume ticket printers, manage donations, volunteers, & mail lists and assist with most of the administrative tasks that you will ever do.

 

http://www.artsman.com/

 

 

---Fangzhou

Providence asks arts administrators' advice in financial crisis

Mayor David N. Cicilline of Providence, Rhode Island might be an arts administrator's best friend. In the face of today's economic crisis, Mayor Cicilline recognizes the financial power of the arts in his city, commenting that they generated $111.8 million in economic activity in just one year. He considers the arts to be a major tourist attraction in Providence, and in an attempt to maintain this type of activity when travel is down, he has created a task force including city officials, local artists, and arts administrators to brainstorm on how the arts can contribute to the stability of the city.

http://www.projo.com/education/content/mc_creative_09-25-08_TTBN0V0_v12.1b2ec09.html

--
Ashley

Chronicle of Philanthropy Recognizes 9 Do's and Don'ts of Email

I thought this was interesting given our recent conversations regarding the effective use of email in our organizations. In the link below, The Chronicle of Philanthropy highlights, among other things, the importance of professional email systems, segmenting, and subject lines. They also mention never ever using Outlook Express several times.
http://philanthropy.com/news/prospecting/index.php?id=5915
--
Ashley

CSO Continues to Impress

Seriously, I think this is absolutely brilliant. Here’s a link to the web version of an e-blast the CSO sent out this week offering recipients a free download of a CSO recording from iTunes: http://www.cincinnatisymphony.org/SymphonEmail/iTunes_101508.htm

 

This is so great. Could potentially motivate sales on iTunes of other CSO recordings, as well as motivate ticket purchases for upcoming performances. One suggestion: they should be offering a song from upcoming programming. For me, a low frequency symphony attendee relatively unfamiliar with classical repertoire, an exciting recording could seriously motivate me to purchase a ticket for the coming weekend’s performance. Regardless, this is a great way to stay in touch and continue to cultivate relationships with ticket buyers and donors. The CSO continually impresses me with their use of innovative, relationship-building tactics. I am reminded of a “personal email” that came from Erich Kunzel at the end of last season with the subject line, “My thanks to you”.  Inside was a brief message from the Pops Director (targeted well; surely they did this for classical attendees as well from Paavo) sending thanks for support during the past season and providing an update of what to expect in the coming year.

Manhattan School of Music Faculty to Unionize?

I thought this was a rather interesting article: faculty members from the Manhattan School of Music are attempting to unionize in order to secure health insurance and job security. The story depicts the school as marginalizing certain faculty members without giving any reason and offering no recourse.

Now, I know that there is a rift between those for and against unions in our class, so I thought it would be interesting to throw out there. Is the school taking advantage of faculty that may not know all that they need to know to negotiate a contract with all the terms they really need? Is the faculty blaming the school while not taking advantage of the resources they have available and jumping on the unionization ship too early and without enough information about the consequences? Is the school really stealing students from the more expensive faculty members and giving it to the younger faculty to save money and then spending it all on the president's penthouse?

I would love to continue to hear about this as it develops!

--
Leslie Fay

New Orchestra Business Model

This is one of my favorite arts business articles.  Bruce Coppock, president and managing director of the Saint Paul Chamber Orchestra, lays out a convincing new model for business in the orchestra world.  He dismisses the standard three-legged stool model and instead looks for new opportunities.

Coppock says, "If we think of ourselves as being in the concert production business, and think of ticket revenue as core revenue, we limit potential revenue. However, if we think of ourselves as being in the patron development business and think of producing concerts as our mission, new horizons appear."

Under this new model, the Saint Paul Chamber Orchestra slashed ticket prices in half, increased their subscriber base by 35%, and increased patron revenue by $500,000.

http://www.americanorchestras.org/images/stories/symphony_magazine/jan_feb08/Currents.pdf

--Evan

Will fine arts be an alternative for Investment?

With the whole world economic crisis, traditional equity and bond market could no longer satisfy investors' requirement. Some people believe that fine arts, as an alternative investment, could serve as a profitable choice in the portfolio.

This article provides an inside perspective regarding concerns about fine arts investment, such as how to fit arts in the portfolio. Quite interesting.

http://www.prweb.com/releases/2005/07/prweb263010.htm

 

 

----Fangzhou Xu

Want More Arts Funding? Vote.

Why aren't the arts an issue in most elections?  Because supporting the arts does not guarantee votes says playwright Dan Hunter.  Chamber Music America recently published an article by Hunter urging arts supporters to push the arts as a key issue in local and state elections.  Hunter cites the 2007 Philadelphia Mayoral race - arts supporters successfully organized and made the arts an important issue in the race, with each of the five candidates developing arts policy positions.

The lesson, pay attention to upcoming elections, especially local ones, and push the arts as an issue that will carry votes.

http://www.chamber-music.org/pdf/magazine/2008/Sept2008MakingYourVoteCount.pdf

--Evan

Critical Links Research from EdTA

EdTA posts the results of Ohio based Critical Links Research.
 

http://www.edta.org/criticallinks/

 

The ultimate goal of the project, according to James Palmarini, project director and the editor of Teaching Theatre journal, is to create a network of theatre educator learning communities and a Web-based index of best teaching practices, based on the classroom research work of the participating teachers. "Critical Links asserts that the theatre teachers working with students every day are the best judge of what works and what doesn't in the classroom and on the stage," he said. "The project assumes that skilled educators can learn research methodology, gather and organize data, and contribute valuable information to the domain of theatre education."

--
Tom

Development? What's that??

An interesting review of mid-sized American dance companies: http://www.star-telegram.com/entertainment/story/964107.html

 

Who thought it was a good idea to operate for three years without a senior executive managing contributed revenue? Best of luck to Texas Ballet Theater as they struggle to reduce their debt by the end of this FY.

 

~Mark

Nudity taken out of Met's HD Telecast

For it's most recent HD telecast, The Metropolitan Opera decided to use a variety of camera angles to cover up the fact that it's opera's heroine briefly appeared nude on stage. Finnish soprano Karita Matilla, who earned rave reviews as the lead in the Met's previous production of Salome, is reprising her role this season.

The opera's most famous scene, the Dance of the Seven Veils, ends with Salome standing naked on stage. I find the Met's decision to avoid the nudity-in the broadcast only-interesting. On one way, It makes sense to avoid anything that would possibly offend theatre-goers, especially younger audiences who maybe aren't expecting it. On the other hand, this is by no means standard repertoire. Most people who are interested in seeing it are aware of the nude scene, and may potentially be disappointed when it doesn't happen.

It seems strange to choose an obscure, controversial work for the telecasts, and then take away what makes it controversial.

Nate

Cheap Seats

The economy is affecting the average ticket price on Broadway.

The New York Times offers various suggestions for bargain ticket deals to keep people participating in the arts.

http://www.nytimes.com/2008/10/10/arts/10chea.html?_r=1&th&emc=th&oref=slogin

--
Tom

Cultural Capital

We started hearing about the "Creative Economy" (popularized by John Howkins) a few years back: the concept that communities making an investment in their cultural life generate new economic opportunities, retain more skilled workers in their local economy, and dramatically improve the quality of life for their citizens. This idea has taken root in urban planning and revitalization projects across the nation, and a report (see the full report here) to the Portland, Maine city council suggests creating a dedicated city agency for the support of an enhanced creative economy in their city. If cities like Portland, ME (with a population of less than 100,000) are willing to invest time and resources in support of the arts, why not make this a nationwide initiative? If you're looking at programs like these and thinking "wow, my city should really be doing something similar!", your city council and mayoral office are good places to start. Vocalize your support!

--Dana Horst

More ideas to attract younger audiences

Everyone seems concerned about aging audiences these days. Some organizations simply are moaning about it, while others are trying their best to think of creative, out-of-the-box ways to reach younger audiences and people that simply have never been.

This is especially true of the Zurich Opernhaus, which broadcast La Traviata live from the busiest train station in Switzerland, Hauptbahnhof. Seems as if the train station was still open for business as regulars drank at the bar and people went about their business of getting on and off trains. It also seemed like it was a smash hit! Besides this production, the Opernhaus did a live broadcast of Magic Flute with 6 hours of backstage footage which apparently got similar ratings to a Champions League football (soccer) game (that includes Manchester United and Real Madrid!!!)! That's amazing!

But is this type of production only making audiences for this type of production (like they say that giving away free tickets only makes consumers of free tickets, not audiences willing to pay to see your art) or will is transfer to other productions? OR is this the way that opera productions are going to have to move - television broadcasts, simulcasts, webcasts, etc. - to keep up with changing times?

--
Leslie Fay

Community Engagement Through Art

Philadephia's Mural Arts Program has been working to bridge racial and socioeconomic divides through collaborative art projects since 1983.  Their community-centered artwork reaches out to populations plagued by gangs, drugs, and violence, and helps to uplift and encourage through public artwork.  These projects use collective responsibility and engagement in the process of creating the artworks to strengthen a community around their project, with the added bonus of beautifying the neighborhood and encouraging new development in lieu of urban blight.
Kudos to the city of Philadelphia for providing some financing for this program, and for recognizing, in the words of Jane Golden, director of Mural Arts, that "community public art can knit people together in a way that other things can't. It has this ability to build a consensus and to challenge people who think collectively for the greater good."

-Dana Horst

To Gala or not to Gala...let the Economy Decide?

In response to a posting regarding the overall expectancy for donations in the non-profit arts world in the wake of economic distress, the following article points out the state of a particularly
sensitive field...Special Events.

http://www.nytimes.com/2008/10/05/fashion/05gala.html?ref=style

It's no secret that most of these galas and benefit events feature the same prominent figures in both the business world and social circles (one needs only to glance at the NYT society pages to view recurring names and faces). These names and faces however are those most likely to have been hit by hard times of late. Can an arts organization justify lofty budget allocations for flowers at a gala when a large part of the industry is merely looking to keep jobs?

The answer is simple - yes. Recently having experienced the process of planning a major event for a non-profit organization, I will admit that I, too, was skeptical of the process (mostly spending). However, an end result leads to only one conclusion - the benefits far outweigh the costs. As put by the New York Women's Foundation in their slogan for this year's event, it's truly time for donors to step up - galas offer a chance not only to celebrate the organization, but to bring together donors and give a face to the financial support. And who doesn't love mini hamburgers?

- Courtney Kelly

Arts in the Wake of a Failing Economy

How is the current economic status of the country affecting the arts world? While this article focuses predominantly on commercial activity in NYC, it reminds us that nonprofit arts organizations could potentially experience a significant drop in both earned and contributed revenue in the coming year. Do you think that cities throughout the U.S. will experience any significant impact?

 

http://www.nytimes.com/2008/10/08/theater/08bway.html?ref=arts

 

Personally, I think we’ll be okay. There might be a noticeable decline in major gift activity (both institutional and individual), but I don’t think annual fund or ticket sales will be greatly impacted. Fingers crossed.

 

~Mark

St. Louis Symphony Offering Resources for Teachers

The St. Louis Symphony has released the first two videos in its E-Symphony Series, "Working Together in Music", and "The Role of Pitch in Music".  Each lesson is accompanied by lesson plans and suggested activities that help teachers to use the material effectively.  It will be interesting if this project actually translates well into the classroom or if teachers will continue to rely on more traditional resources.

Check out the videos at: http://www.slso.org/cp/video.htm

--Evan

20/20 Continues!

Don't forget that Cincinnati's own 20 Days and 20 Nights Arts and Cultural Festival continues this week! Check out tons of free or super affordable events every day and night til October 15. My favs include "Escape to Arts Mountain" - an Architreks tour of cool architecture in Mt. Adams and a spooky tour of the Art Museum at night called "Van Ghosts and other Hauntings".

 

Check it out at http://www.20daysand20nights.com

--
Ashley

Recession Collection

Want to encourage your clientele to continue investing in original artworks even as they fret about the Dow?  Tell them about the vogue for the handmade / super-limited-edition print category.  At less than 10% (on the high end) of the price for an original Chuck Close on canvas, a Chuck Close (or Kiki Walker, or Ellsworth Kelly, or Louise Bourgeois) on paper puts you in the company of collectors who are art-smart but still looking out for the overall cachet of their acquisition portfolio.  Don't let the "craft" label color your perception- this is not papier-mâché amateur hour.  After all, the Whitney has a curator of prints, and Sotheby's has a contemporary prints division.  Who said you couldn't apply "buy low, sell high" to the fine arts world?

-Dana Horst

City Opera Lays Off 11 Members of Its Staff

Including the Executive Director, Jane Gullong (although the spokesman claims these events are unrelated). Apparently newly appointed general manager Gerard Mortier doesn't see the need for an ED - "The way Gerard Mortier works is, he never had an executive director in previous functions" - interesting. But Gullong served as Dev. Director for ten years at the Opera - is it a wise move to let her go with so much past fundraising success under her belt? I suppose with
a $15 million deficit also under her belt, that's a hard case to make. Said deficit along with limited programming due to a Lincoln Center renovation project is apparently to blame for the other eleven layoffs, spread all over the organization.

Anyhow, Mortier is definitely spicing up the admin scene, especially that of "the people's opera." City Opera's chairwoman said of him, "he is like the pretty girl at the dance who gets lots of offers to trip the light fantastic." Not fully satisfied with the progress made by the organization on its fundraising goals or the lack of support he has received from the Board in the past, Mortier has accepted a few offers to trip that light with European opera companies who like his taste for contemporary works (despite being deemed "Eurotrash" by some whiny Salzburg patrons).

As for its role in the NY Cultural scene, maybe this will put City Opera on the map (the least we can hope for is some of Mortier's neon-lit silver jumpsuits from recent Magic Flute endeavors). If you're wondering where it's been all this time, don't ask me...considering the Met has Renee Fleming's face plastered all over New York's public transit system and Gossip Girls posing on it's Opening Night red carpet, CO has a tough hill to climb.

http://www.nytimes.com/2008/10/04/arts/music/04oper.html?ref=arts

"Doctor Affordable"

When you're really, really nice to your board, they'll return the favor in amazing ways.  See:  the half-million dollar Varis-Leichtman prime seats to the Met's hot-ticket "Doctor Atomic" this fall... for $30 each.  Yes, $175+ seats for $30 for every performance. That, my friends, is extraordinary board commitment.  Starving artists everywhere thank you, Ms. Varis and Mr. Leichtman.

-Dana Horst