National Arts Index Reveals Lower Health and Vitality of Arts Industries in 2008

Due to losses in charitable giving and declining attendance at larger cultural institutions, the health and vitality of the arts in the United States was lower in 2008 than it was in 2003, a new report from Americans for the Arts finds.

According to the National Arts Index (146 pages, PDF), attendance at art museums decreased by 13 percent over that period, while audiences at popular music events were down by 6 percent. At the same time, the report found that between 1998 and 2008 there was a steady increase in the number of artists and arts organizations and in arts-related employment. Indeed, while attendance at arts events is shrinking, advances in technology are changing how Americans experience the arts.

Conducted over four and a half years, the first study of the health and vitality of the arts industry in the United States looked at seventy-six indicators in nine categories to arrive at a decade-long view of trends in arts philanthropy, participation, and creativity as well as the relationship of the arts to other areas of American life, including employment and education. The measures include capacity and infrastructure, participation, contributed support, employment, nonprofit, creativity, demand for arts education, arts business, and competitiveness.

Measured against a base acore of 100 (in 2003), the overall index score fell to 98.4 in 2008 and achieved its ten-year high, 105.5, in 1999. "The current economic crisis offers a unique and important opportunity to begin a national conversation about the value of the arts — to us as individuals, communities, and a nation," said Arthur C. Brooks, president of the American Enterprise Institute and one of the project's advisors. "We need to rethink a nonprofit arts sector that in many ways remains tethered to support models that have remained unchanged for a half century. Arts organizations need to find creative ways to engage their audiences, build on the public's growing interest in personal creation, and stimulate audience demand."

Although the national study was funded in part by the Rockefeller and Henry Luce foundations, the Michi-gan-based Kresge Foundation has awarded $1.2 million to Americans for the Arts to create a companion Local Arts Index and provide workshops and materials necessary to assist communities in the effective application of the local data. "Our work in all parts of the country suggests that the National Arts Index will have a valuable impact on local communities of every kind," said Kresge Foundation president Rip Rapson "The Local Arts Index — the local application of this national tool — will help local leaders in one hundred communities make better-informed decisions about arts and culture investments. It will also contribute to heightened community understanding of the importance that arts and cultural activities play in a community's economic health and social vitality."

“First-Ever National Arts Index Measures Health and Vitality of Arts in the United States.” Americans for the Arts Press Release 1/20/10.

Trescott, Jacqueline. “The Nationals Arts Index, a New Survey by Americans for the Arts, Paints a Troubling Picture for Arts Organization.” Washington Post 1/21/10.

 

Already Struggling, Artists Hit Hard by Recession, Survey Finds

A new survey of American artists — two-thirds of whom say they earned less than $40,000 and a third less than $20,000 last year — found that slightly more than half experienced a drop in income in 2009, the New York Times reports.

Commissioned by nonprofit artist-support organization Leveraging Investments in Creativity and funded in part by the Ford Foundation and the National Endowment for the Arts, the survey found that 51 percent of the more than fifty-three hundred respondents saw their incomes fall in the past year, while 18 percent reported a drop of at least 50 percent.

The report, The Artists and the Economic Recession Survey: Selected Findings (8 pages, PDF), found that the most commonly reported impact of the recession was a decline in sales, followed by lower rates or fees. In addition, more than a third of the surveyed artists reported fewer and smaller grants, fewer grant opportunities, and fewer scheduled bookings and chances to exhibit, perform, or present their work.

The survey also provided statistical support for long-held beliefs about artists, such as they tend to work day jobs to support themselves, musicians and architects tend to do better financially than writers and painters, and more than a third of working artists lack adequate health insurance.

According to Judilee Reed, executive director of Leveraging Investments in Creativity, "A lot of the artists who were reporting were telling us, 'I live in a recession all the time, so this downturn has really not been so different for me.'"

Kennedy, Randy. “A Survey Shows Pain of Recession for Artists.” New York Times 11/24/09.

Bill Proposed to Revive 'Fractional Gift' Donations of Art

Reacting to museums' complaints of sharp declines in donations of art, a bill recently proposed by Sen. Charles Schumer (D-NY) could revive the practice of so-called fractional gifts by making the process easier and more tax-advantageous, the Wall Street Journal reports.

Prior to passage of the Pension Protection Act of 2006, collectors were allowed to claim a tax deduction when they donated a work of art "incrementally" — that is, donating a certain percentage of rights to the work each year. However, restrictions in the 2006 legislation prevented donors from realizing tax benefits when a donated piece of art appreciated in value and limited the time allotted to complete a fractional donation to ten years. As a result, wealth advisers and estate lawyers soon stopped recommending the practice and such gifts "virtually dried up," said Association of Art Museum Directors president Michael Conforti.

The bill proposed by Schumer would give donors twenty years to complete the donation of a gift and allow them to take a deduction on a portion of any subsequent appreciation in its value. In addition, the bill would require museums to report fractional donations on their yearly tax forms and exhibit the artwork in proportion to its ownership interest over every five-year period, which would keep it from remaining permanently in the donor's private collection during the gifting period. Gifts also would be subject to a binding written contract to protect against challenges by heirs after a donor's death, with donations valued at more than $1 million requiring a review by the IRS's art advisory panel.

Critics of the proposed bill argue that if donated art declines in value, a donor's tax break could shrink. Indeed, the bill comes at a time when prices for art have dropped 30 percent and are on track to return to 2004 levels, according to Mei Moses Art Indexes, which tracks repeat-auction sales.

Sen. Charles Grassley (R-IA), who as chairman of the Senate Finance Committee spearheaded the initial changes in the original Pension Protection Act, said the proposed bill is a compromise. "Some museum officials thought Congress went too far to shut down abuse," he said. "I still think partial donations of art are of questionable value to taxpayers, but museum officials and their champions feel strongly otherwise, so I'm willing to continue to listen."

Banjo, Shelly. “Restoration Work on Gifts of Art.” Wall Street Journal 8/08/09.

 

Art Museum Attendance Down Nationwide, Reports Find (6/20/09)

According to two recent reports on youth and adult participation in the arts, visits to art museums have declined across the country, the Washington Post reports.

Based on a survey of nearly four thousand eighth-grade students, Arts 2008 found that the number of students who reported they visited an art museum or gallery with their classes dropped from 22 percent in 1997 to 16 percent in 2008. Published by the Nation- al Center for Education Statistics, the report was generated by the National Assessment of Educational Progress, which releases reports periodically on different sectors of achievement and engagement; this year the assessment examined visual arts and music.

The second report, Arts Participation 2008: Highlights from a National Survey, found that fewer adults are choosing art museums or visual arts festivals as leisure-time destinations. Although the decline in attendance has been relatively small -- from 26 percent of adults between 1992 and 2001 to 23 percent in 2008 -- the National Endowment for the Arts report warned that, as the most loyal section of the museum audience ages, the shift may be indicative of future declines. The report also noted sizable declines in almost every performing arts field between 1982, when the organization first started documenting arts participation, and 2008.

The NEA report "shows that audiences for the arts are changing," said NEA acting chair Patrice Walker Powell. "While many now participate in arts activities available through electronic media, the number of American adults who are participating in live performing and visual arts events is declining. The find- ings underscore the need for more arts education to foster the next generation of both artists and arts enthusiasts."

Trescott, Jacqueline. "Studies Show Art Audience Decline." Washington Post 6/16/09.

Becerra Calls for Examination of Waste, Abuse in the Nonprofit Sector

Speaking to a group of nonprofit leaders, Rep. Xavier Becerra (D-CA), a member of the powerful House Ways and Means committee, said that there is a pressing need "to look at the issues of waste, abuse, and corruption in the nonprofit world," the Chronicle of Philanthropy reports.

During the meeting sponsored by Independent Sector and the Internal Revenue Service, Becerra did not outline any concrete steps he would take on such issues but emphasized that the challenges presented by the recession make it even more important to "find out who the bad apples are in the nonprofit world."

While he acknowledged that some have accused him of trying to "run the nonprofit sector into the ground," Becerra called such characterizations unfair and said that philanthropy is indispensible to American society. Rather, he said, his motivation for examining philanthropic activity stems from the needs and concerns of his congressional district, a largely working-class section of Los Angeles that is home to many immigrant families.

"When I see a nonprofit organization paying its executives more money than the president of the United States, I don't know if the folks in my district who are paying taxes on the $30,000 they make a year appreciate that," said Becerra. "When I find that most of the money in the nonprofit world doesn't even end up helping the Latino, the African-American, the Asian-American families in my district who are trying to make their way up, but ends up mostly in the backyard of the folks who gave the money...then I wonder if we are getting the most out of those dollars by allowing tax-preferred treatment in the nonprofit world."

Jensen, Brennen. “Congressman Urges Charities to Stomp Out Waste and Fraud.” Chronicle of Philanthropy 6/23/09.