NEXT YEAR COULD BE A WHOLE LOT WORSE
Hello everybody.
“And the beat goes on............”
THE CALM BEFORE THE REAL STORM?:
In conversations with foundation program officers, local and state arts agency directors, and elected officials, I am hearing the same draconian predictions – that arts organizations (in many, if not all, places) haven’t yet really begun to feel the economic crisis that is looming in the near future. We’ve been hit hard already, but we’re really still living on last year’s budgets and spending patterns – last year’s city and municipal budgets, last year’s foundation budgets, last year’s philanthropic giving, and last year’s audience attendance. And it is going to get a lot worse.
I am hearing that some major foundations may be cutting their funding pool budgets for next year by 20% or more, and that some smaller arts funding foundations are contemplating even deeper cuts. Local cities and counties, hard hit by the economic downturn and desperate for revenue, are likewise contemplating huge reductions for arts funding. And the competition for those scarcer dollars is heating up as many government funded areas seek to appropriate arts money for their needs, and are making the argument that what they do is more critical and necessary than arts funding and that arts funding must, during these hard times, take a back seat to other, more pressing needs. There are many cities and counties where the local arts agency funding pool is threatened with elimination or drastic cuts. Similarly, hotel tax funds – used to fund the arts in many jurisdictions, are down because tourism is down, and thus their pool of arts money is shrinking.
The response by many arts organizations to these possible reduced funding pools is to (perhaps erroneously) assume that if there is a 20% cut in some funding pool (hypothetically a foundation let’s say), that their grant will be cut by 20% next year. But what I am hearing is that (at least some) funders are trying to reassess what they fund and to what extent as they struggle to make hard choices in these desperate times, and that may mean that any number of organizations that have for a long time gotten an annual grant, may this year not get a cut in that grant, but rather may not get any grant at all. If the average arts organization’s funding includes a number of grants from a variety of sources, all of these cuts, in the aggregate, may add up to be a quite substantial portion of their total budget. For any number of organizations that could be an overall cut to their budget much larger than what they are anticipating.
Add to our problems that the number of those donating to the arts may not be falling, but the amount of their individual gifts apparently is. Corporate giving is way down across the entire nonprofit sector. And we have all seen the impact of audiences staying home resulting in cancelled or shortened performance schedules and the like. The NEA economic stimulus money (though not very much) nonetheless has helped some organizations cope with the (so far) relatively modest downturn (compared to what might lie ahead this coming year), and that has, itself, created somewhat of a false sense of security. That extra money won’t be available next year.
The long and short of all this is that a lot of inside people are talking about the next year as one that will really hit the arts hard. Some organizations are in denial over what may be coming, others may just not see it coming and are going to be in for a shock. Still others see the writing on the wall and are trying to plan for survival, but aren’t sure to what extent all of this will hit them. It will be prudent for arts organizations of all types and sizes to do some very serious worst case scenario planning this year in anticipation for next year.
One can only hope the above scenario doesn't happen.
NEA CHAIR NOMINEE:
The New York Times broke the story last week that Rocco Landesman, a broadway producer, is President Obama’s choice to head the NEA (www.nytimes.com/2009/05/13/theater/13nea.html?_r=&scp=1&sq=endowment%20for%20the%20arts&st=cse ) For many in the arts this was a very surprising nomination, and some will be disappointed that Obama didn’t pick someone of color, a woman and / or someone with nonprofit arts experience. I don’t know Mr. Landesman, but like him I was an outsider and came from the "for profit" entertainment sector when I first started in the non profit arts 13 years ago, so I would hope everyone would give him a chance. I think it incumbent on the whole of the arts field to open an immediate dialogue as to what the NEA should be, what its’ priorities ought to be, how it’s money should be allocated and what role it should play in supporting arts & culture in America. I think every national arts service provider group – from every discipline, along with the foundations and funders, and & every state and city agency, should all begin to ask their colleagues to chime in on what kind of NEA we all want to see and then begin to organize those thoughts and reflections and share them with Mr. Landesman. Along that line, I intend to gather a half dozen or so leaders for discussion on this blog of exactly those questions -- with the hope that such an exercise might motivate others to do the same. The NEA ostensibly belongs to all of us. We need to discuss what the agency should be.
AMERICANS FOR THE ARTS IN SEATTLE:
With budget cuts, shrinking funding pools, and looming challenges, it is hard to argue that people should spend money and time travelling to attend a conference, but I would argue that this is precisely the time when arts leaders should get together --- to talk about those challenges, share ideas as to how to survive and cope and to network with their peers. For me, the Americans for the Arts conference has always been one of my personal preferred meetings. I can think of three really good reasons why arts leaders here in California in particular should attend the meeting in Seattle June 18-20th.
1. The networking possibilities. The conference provides one the better opportunities to intersect and interact with some very well positioned and powerful leaders in the field -- including those from three key groups: a) a large segment of the foundation / funding community -- (and I like to intersect with the people who have the money because sharing information with them tells you a lot about the health of our sector and let’s you know what kinds of projects may and may not fly in the future), b) a very large segment of the national service provider organizations(half of which it seems are now part of Americans for the Arts under the expansion umbrella of the past few years), and interaction with those people gives me a good idea as to what the various sectors of our field are facing and what they are doing to cope, and let's me get a handle on how others are successfully dealing with major challenges (it also let's me brainstorm with people from different corners of our field about possible collaboration, and (c) an excellent cross section of the sector's best and brightest independent consultants - and as a consultant now I like to touch base with others to see where there might be some possibilities for collaboration or for work.
I have found that I invariably come home from these gatherings with a new project in the development stage, and a very high percentage of those embryonic projects conceived at this conference end up being realized. Something seems to happen here and there are always surprising outcomes.
2. AFTA always allows attendees the opportunity to really see and experience the arts & culture of a city up close and in detail. I have been to probably a dozen AFTA conferences, and but for those conferences I would never have had the chance to really experience those cities and their arts communties in anywhere near the depth I do because of AFTA's sponsorship. Seattle is a fantastic and cool city, and it's so close to California that it's possible to come to this meeting Thursday and go home Friday night if you want to. Airline flights have never been more reasonable and there are multiple hotel options. As the conference rotates to different locations around the country, (and was in Vegas two years ago), it isn't likely to be back on the west coast for some time.
3. The chance for renewal. I have come away from each of these conferences both renewed and re-energized, and it is important for arts leaders during these times to get reconnected again to the pool of positive energy that will allow them to survive and weather these tough times.
Click here for AFTA convention information & registration www.americansforthearts.org/Events/2009/convention/default.asp
Have a great week.
Don't Quit.
Barry