Larger Museums Now Feeling a Financial Impact

The Philadelphia Inquirer is reporting the Philadelphia Museum of ARt plans on cutting staff, reduce the number of future exhibitions, cut salaries and may also raise rates. The reduction in the museum's endowment appears to be the main culprit.

I dont want to get too political here on the AW Blog, but with President Obama recently announced tax increases on earnings above $250,000.00, I can only wonder if some of the charitable donations of the wealthy and upper income levels will soon be scaled back. We have already seen some of that happen with suffering corporations curtailing their charitable activities and support for the cultural arts. According to the portion of the tax plan/budget I have seen, earners in the top brackets (above $250,000.00) will encounter higher progressive rates and stricter limits on itemized reductions by reducing the effects of itemized deductions, including charitable donations, and thus increasing the tax liability. This could also impact the appraisal profession, if less individuals are donating and gifting personal property, there will be fewer appraisals.

According to Philly.com the article states Facing a dramatic downturn in its endowment and waning city support, the Philadelphia Museum of Art is cutting staff, delaying exhibitions, curtailing programs, trimming salaries and — subject to city approval — increasing admission fees.

The cuts will bring the museum’s operating budget down by about $1.7 million to $52 million for the current fiscal year, which ends June 30, and, the museum hopes, will stave off a deficit the following year forecast as high as $5 million.

The museum will eliminate 30 positions — about seven percent of the staff — in all areas, though no curators are being let go. Of those 30 jobs, 16 are layoffs of current personnel, with the remaining positions lost by not filling vacancies.

Senior staff will take salary cuts of between five and 10 percent, said interim CEO Gail M. Harrity yesterday.

Painful as the reductions are, they might not be the last. “If endowment keeps being reduced in value there are going to be further steps taken. We would anticipate further reductions in personnel and operating,” said chairman H.F. “Gerry” Lenfest.

Along those same lines the Atlanta Journal Constitution is reporting that Atlanta's High Museum will cut staff and initiate pay cuts and the Baltimore Sun is reporting the Walters Museum is cutting staff and seeking ways to reduce spending.

To read the article on the Philadelphia Museum click HERE, to read on Atlanta's High Museum click HERE, for more on the Walters in Baltimore, click HERE.