Funding an art renaissance in the US
- 8 April 2015
- From the section Business
US art museums took a knock in the wake of the 2008 financial crisis and attendances continue to fall.
But some major investments and new approaches to fundraising have helped them rebound.
On an unseasonably warm day in January, as the price of oil dropped by 50%, a group of Texans gathered at a swanky New York restaurant to present a multi-million dollar plan for the redevelopment of the Museum of Fine Arts, Houston.
There were a number of jokes about the impact of oil prices on the portion sizes offered by the restaurant - two salad leaves and a pea, however artfully placed on a teaspoon of green mousse and a coin sized piece of fish, do not make a meal in Texas.
But there was no joking about the importance of art to Houston's economy, which is fuelled by oil and energy and has been rocked by the plunge in prices.
The city hopes the new campus, with its world class collections, international art school and conservation centre, will help attract the type of workers it needs to diversify and sustain future growth.
"Building a green park of two acres in a downtown city - that's meaningless today," says Texan pipeline tycoon Rich Kinder, one of the richest men in America with a personal net worth estimated at $11.9bn (£8bn).
"This is a massive extension of the south west's largest museum of fine arts, but it's also much more than that. It's transformational for Houston."
US Art Funding
- Individual philanthropy remains the strongest source of support for art museums in the US.
- In 2013 museums were given six times as many works of art as they purchased.
- Endowments, trusts and foundations provide 28% of art museum funding.
- The government funds 6% and corporate giving accounts for just 4%.
- Visitors spend an average of $8 when they go to a museum.
- Each visitor costs the museum an average of $53 in terms of investment.
Figures from the Association of Art Museum Directors
Almost all the $350m cost of the project has been met by wealthy individuals, including Mr Kinder, who is chairman of the museum's board of trustees. He donated $50m.
Due to be completed by 2019, the museum campus is expected to generate $334m in economic activity over 20 years.
That's in line with a new report from the National Endowment for the Arts (NEA), a government grant-making agency, which says arts and culture contribute almost $700bn to the US economy, outperforming the construction industry.
The sector also employs some 4.7 million workers, and for every 100 jobs created by demand for the arts, 62 jobs are created in other areas.
On the downside, the report also shows that museum, gallery and theatre attendances are continuing to fall. According to the NEA, the vast majority of Americans "consume" the arts online and only 21% actually visit art museums.
"But we do ourselves a disservice when we look at only one measure of engagement with the arts," says NEA chairman Jane Chu.
"Our reports show that the arts are a formidable presence in America and the ways in which people participate are expanding."
She says technology provides an early entry point to the arts which may peak interest in live performances and trips to museums.
But institutions need to find new ways to engage with audiences and become more relevant to their communities, she adds.
"Museums were founded years ago on the idea that they were treasure troves or libraries of objects. Today they have to be destinations for people to have experiences that they can create and be a part of," says Doreen Bolger, director of the Baltimore Museum of Art in Maryland.
The museum has an international reputation and holds the largest collection of works by Henri Matisse.
It is supported by a $100m endowment that enables it to offer art making days for local families, outreach programs for city schools, and interactive mobile phone tours for visitors.
In 2006 it introduced free admission.
"We were of course affected by the 2008 downturn because all of our diverse [revenue] sources were affected. But our trustees and donors have been truly astounding.
"Our funding from them was sustained throughout the downturn and many people increased their giving when the museum went free. They felt it was important to provide that for the community," says Ms Bolger.
Endowments remain the most significant source of museum revenue, but new figures from the Association of Art Museum Directors (AAMD) show that funding has become more diversified.
Admission fees play a relatively small part, but memberships, foundations and trusts, store purchases and local government funding make important contributions. Corporate donations have fallen.
"Museum attendance dropped off in 2008 and some museums underwent some staffing cuts, cut back a little on programming. They did what they needed to do to weather the storm," says AAMD director Christine Anagnos.
"But they're [now] financially stable because they receive their money from a variety of sources," she says.
"They're not just relying on one source, whether it's endowment income or earned revenue or corporate memberships. They are really diversified in their revenue streams."
Ironically, Houston was sheltered from the worst effects of the financial crisis because of its dependence of oil. But today that dependence is making it vulnerable.
"People will tell you that Houston is not nearly as wedded to energy as it was a generation ago," says Rich Kinder.
"We have the largest medical centre in the world, a tremendous port and a number of universities. But [the falling price of oil] still has a definite impact and will have an impact on philanthropic giving."
But Gary Tinterow, the director of Houston's Museum of Fine Arts, says he doesn't expect any dramatic decline in donations, and philanthropy remains a better bet than public funding.
"There is something very satisfying and secure when you have government support. You know what your budget is each year and you move forward. But as we've seen with the recent downturn, sometimes massive cuts are necessary in order to fill the mandates from the government."
The Obama administration has proposed a $2m increase to funding for the NEA next year, bringing the total to $148m.
The advocacy group Americans for the Arts says that won't meet the needs of the 95,000 non-profit arts organisations and local agencies the NEA helps support.
But the good news is that donations to the arts were up by almost 8% in 2013, according to the latest figures from Indiana University, which tracks charitable giving. The total, $16.66bn, is now touching pre-recession levels.
Even if Americans don't go to museums as much as they used to, they clearly think the arts are important enough to support.