Category: issues

The Ordway Center for the Performing Arts is a prominent jewel in the Twin Cities’ cultural crown. It hosts touring Broadway shows, and is home to the renowned St. Paul Chamber Orchestra. But the Ordway, which has never been on firm financial footing, is now at crisis level, with its endowment depleted and sponsors pulling out of events they have long funded. Further complicating the fiscal situation is the fact that the Ordway receives a portion of its budget from the State Arts Board, which is now targeted for a funding cut of 40%.

Bucking the recommendation of its own director, the Minneapolis Library Board has voted not to close four of its branches for the rest of the year. The closings had been proposed as a cost-saving move for the city in the face of a staggering state budget deficit. The Library Board will make a series of one-time cuts in services rather than go through with the closures.

Israel’s arts groups plan to shut down the country’s cultural life June 1 “if the government does not restore funding for artistic productions. Israel, like governments around the world, is facing a budget crisis, and has made deep cuts in cultural funding.

A year ago, Minneapolis was planning an impressive new downtown library, and trumpeting the value of the project to the city and the entire metro area. Now, the new library may be on hold, and city officials are planning to shutter four branch libraries for the remainder of 2003 in an effort to deal with the severe budget cuts being handed down by the legislature. Minnesota has a budget deficit of nearly $5 billion for the next biennium, and the state’s largest city is facing massive cuts in services as a result. Closing the branch libraries is expected to save the city $2 million.

When former Sotheby’s chairman Alfred Taubman was convicted of price-fixing in 2001, a flood of lawsuits were filed by collectors who had paid the inflated prices created by the collusion between the auction house and its main rival, Christie’s. The auction houses have already paid more than $512 million to resolve such claims in the U.S., and now, a settlement has been reached for each house to pay an additional $20 million for claims from overseas buyers. $20 million is a drop in the revenue bucket for the world’s two largest auction houses, and observers say that the settlement is great news for Christie’s and Sotheby’s.

If it seems like performing arts groups are forever begging their subscribers and benefactors for money, it’s only because they are. Ticket revenue doesn’t begin to cover the cost of operations for orchestras, theatres, and dance companies, and the rest of the budget must be made up from endowment revenue (if the organization is lucky enough to have an endowment) and annual contributions. Most patrons don’t really understand how the funding mechanism works, but in an era of budget cuts and fiscal crisis in the arts, it is increasingly important for the fund-raising machine to function smoothly and efficiently.

States across America are cutting arts funding. “To be sure, it is an extraordinarily difficult time for state budgets. In the mid- to late ’90s, the states enjoyed healthy revenue streams and almost universally cut taxes and increased spending, including on programs mandated by the federal government (like Medicaid and standardized testing). Now, as the economy enters a second year of doldrums, the states — 49 of which are constitutionally required to keep a balanced budget, unlike the federal government—are paying the price for their earlier optimism. Nor does the horizon look particularly rosy, thanks to the federal budget policy being pursued by the Bush administration. With the president calling not only for elimination of the dividend tax, but an acceleration of the 2001 tax cuts, states are not likely to see more revenue any time soon.”

New York artists and arts spaces are on the move again, looking for less expensive space. This year’s target area – Hell’s Kitchen in the West 30s. “It isn’t news that artists get used like detergent—cleaning up a neighborhood, then flushed away. What does seem like a huge shift is that some artists spaces are trying to buck this trend by buying buildings.”

New York’s attorney general has proposed accounting reforms for non-profits. The legislation “would require many New York-based nonprofits to certify financial statements, create audit committees to scrutinize accounting practices, and ensure a sufficient number of independent board members.” Some arts people are wary. Depending on how the legislation is written, arts groups – particularly mid-size arts groups – could have difficulty complying.

Dutch government spending on the arts is impressive. “The Ministry of Education, Culture and Science’s staggering $21 billion budget is the largest of any Dutch government agency. Adjusted to population size, it’s roughly equivalent to the military budget of the United States. The culture ministry spends $400 million a year directly on the arts — about $25 for every Dutch citizen. But the free ride may be ending. Recent policy dictates that “artists must be supported, equipped and stimulated to stir up their spirit of enterprise,” and institutions must now meet minimum targets for raising private revenues, or risk losing subsidies.”