Detroit Skyline, by Flickr user Wigwag Jones (via Creative Commons)

The picture of Detroit painted by the media often conveys a city in peril. Its dramatic story – the decline of the auto industry, population loss, high crime and drug-infested neighborhoods – has made the Motor City an easy target for sensational journalism and “ruin porn.” But the flip side of the tale is Detroit’s ongoing re-emergence from its 2014 Chapter 9 bankruptcy, the largest municipal bankruptcy case in U.S. history. Against this backdrop, mayor Mike Duggan has appointed journalist Aaron Foley as Detroit’s “chief storyteller,” the first position of its kind in the United States. Foley and other local journalists have noted that those who aren’t wallowing in Detroit’s past woes have made the mistake of overcompensating, painting the city as a beacon – a burgeoning, tech-savvy, foodie town saved by hipsters. The chief storyteller’s job is to redirect the media to stories that more fully capture the city’s complex soul, often with a tinge of self-deprecation and a focus on its more than 200 local neighborhoods in which some 80 percent of residents are African American. Getting in on the storytelling act, local museums are marking the 50-year anniversary of Detroit’s 1967 race riots with widely divergent exhibits, reflecting the complexities of a rebellion that erupted after three black men were beaten, shot, and killed by white police officers. On the silver screen, director Kathryn Bigelow’s Detroit has been accused of taking undue creative license for political and marketing reasons in depicting the riots. Foley’s appointment comes at an auspicious time for Mayor Duggan, who is up for re-election in November and opposed by, among others, arts advocate Ingrid LaFleur, who announced her bid in February.

Murdoch Wins Some, Loses Some. New legislation introduced by Australia’s Liberal party would make it easier for the country’s big media conglomerates to get even bigger. The bill, expected before parliament this month and widely anticipated to pass, would likely most benefit media mogul Rupert Murdoch, owner of broadcasting giant 21st Century Fox as well as News Corporation, which accounts for nearly two-thirds of Australia’s newspaper circulation. If passed, the law would lift current restrictions on a single owner controlling both broadcast and print media outlets in a given market. Proponents see the bill as a way for Australian traditional media to compete with Internet titans like Google and Facebook; opponents point to the potential consolidation of power as a political move that favors the conservative, Murdoch-backed Liberal party. Meanwhile in the UK, Murdoch’s attempt to buy up the remaining 61% of Sky plc seems to have hit a wall, with Secretary of State for Culture, Media and Sport Karen Bradley launching an investigation into whether Fox meets the country’s broadcasting standards.

Whose Art Is It, Anyway? Outcry from animal rights’ activists resulted in the Guggenheim pulling three works using live animals from an exhibition highlighting modern Chinese art. The museum cited safety as the primary reason for pulling the provocative artwork, which includes video depictions of pigs fornicating to an audience and dogs strapped on treadmills charging each other, citing “explicit and repeated threats of violence,” while artists and free speech advocates are blasting the museum’s choice to relent to the pressure. The Guggenheim episode comes just months after Minnesota’s Walker Art Center came under fire for displaying Sam Durant’s “Scaffold,” which depicted the site of a mass hanging of Native American warriors on land formerly held by the Dakota Indians. The pieces of the sculpture are set to be buried in a secret location determined by Dakota elders, but the museum is still dealing with the fallout. Museums are not the only institutions facing challenges from activists; in Berlin, a group of left-wing protesters occupied the Volksbühne Theater with the goal of converting it into a community-driven public theater.

New Museum Aims for Increased Representation of Africa – by Africa. The long-awaited Zeitz Museum of Contemporary Art Africa opened this month in Cape Town, South Africa. Housed in a 102,000-square-foot converted grain silo dating from 1912, the museum highlights contemporary art from Africa, and its diasporas, in an effort to reclaim the legacies of African countries and of Africans living in other countries throughout the world. It’s an approach that contrasts with another massive museum set to open in November: the Louvre Abu Dhabi – created through bilateral deals between France and United Arab Emirates – will feature 620 works from the national collection of Abu Dhabi; the other half will be works on loan from the Louvre in Paris. The international museum will host an eclectic blend of artifacts including Roman columns, Egyptian statues, nymphs commissioned for the Palace of Versailles, African figures, and Byzantine coins.

Declining Lottery Fund is Bad News for British Museums. Since 1994, the Heritage Lottery Fund (HLF) has played a key role in supporting capital campaigns that create new museums in the United Kingdom or maintain and refurbish existing ones. But the fund relies on sales of lottery tickets, which have steadily declined. The HLF has predicted a lottery contribution of £300 million for the 2016-17 fiscal year, down £85 million from 2015-16. The slump in sales is thought to be a result of a 25% increase to the cost of tickets combined with a change to the odds which sharply impacts players’ chances of winning. And it’s not just museums that rely on the lottery; funds also support artists, Olympic athletes, education, and other charitable causes. On the upside, Camelot, the company that operates the National Lottery, has pledged an in-depth review to explore ways to “re-engage players” after an 8.8% decline in sales from last year. The probe will be led by Nigel Railton, the CEO of Camelot Global and acting chief executive at Camelot UK after Andy Duncan stepped down in April.

MUSICAL CHAIRS / COOL JOBS:

• Johnnetta Betsch Cole, recently retired director of the Smithsonian’s National Museum of African Art, was named a senior consulting fellow at the Andrew W. Mellon Foundation, from which president Earl Lewis announced he will step down in March 2018.
• Helen Gayle has been appointed president and CEO of the Chicago Community Trust.
• After a national search, Santa Cruz local Susan True has been named CEO of Community Foundation Santa Cruz County.
• Kathy Halbreich, associate director of MoMA, has taken a new position as executive director at the Robert Rauschenberg Foundation.
• Philip Horn, executive director of the Pennsylvania Council on the Arts, has announced his retirement.
• Houston Arts Alliance has named John Abodeely, who was acting executive director for the President’s Committee on the Arts and the Humanities prior to the committee’s disbanding, as its new CEO.
• Peter Herrndorf will step down after nearly 20 years as the head of Canada’s National Arts Centre.
• Former U.S. ambassador to South Africa and current VP Patrick Gaspard will take over as acting president of Open Society Foundations.
• Judilee Reed, former director of Surdna Foundation in New York City, has been appointed to lead the Creative Communities Program at the William Penn Foundation.
• The Cincinnati Enquirer has laid off its sole arts critic, Janelle Gelfand.

NEW RESEARCH OF NOTE:

• Visual Capitalist used data from the University of Oxford to create a chart outlining how many jobs will eventually give way to automation. Fields requiring social skills and creativity at at the least risk, while entry-level jobs face a great probability of automation.
• Spektrix used data from its pool of more than 300 arts organizations to look for trends in marketing, sales and fundraising in the UK and Ireland.
• The Commission on Evidence-Based Policymaking has released the Commission’s final report and recommendations in a free download on “how to increase the availability and use of data in order to build evidence about government programs, while protecting privacy and confidentiality.”
• Philanthropy is on the rise among Chinese and Chinese-American donors, according to a report by the Global Chinese Philanthropy Initiative.
• A report from GuideStar indicates that nonprofit CEO compensation has nearly recovered from the recession, but a gender gap remains.
• The transportation sector takes a look at challenges in creative placemaking, and identifies ways to participate in a new report called Arts, Culture and Transportation: A Creative Placemaking Field Scan.
• While conducting research for her a book, on tax incentives, Sigrid Hemels uncovered information about free ports, where art can be stored – sometimes indefinitely – tax-free.
• A new paper outlines potential consequences resulting from reductions to arts education.
• Belgian researchers say blindness creates “empty real estate” in the brain’s visual areas, which could be taken up for use by language.
• Different cultures have varied numbers of words for colors. Scientists say that people developed words for the things they most wanted to talk about, using colors as descriptive terms.
• A report from the National Endowment for the Arts supports the large body of evidence suggesting arts participation (making and doing) among older adults leads to better health outcomes.
• The first of a series of reports connecting heritage and cultural practice to well-being is a case-study on issues affecting the Boyle Heights neighborhood of Los Angeles.
• A report ranking European countries on cultural engagement and creativity gives Edinburgh the top spot for cities of a similar size.
• The first installment of the “Inquiry into the Civic Role of Arts Organisations” has been released, investigating barriers and opportunities for arts groups in civic engagement.
• A report commissioned by the Wallace Foundation indicates that forming partnerships is a successful strategy for nonprofits to increase their impact and effectiveness.
• Data analysis by IMPACTS shows that time is more valuable than money when it comes to visiting cultural organizations.
• A Nesta literature review yields four key findings on the integration of digital technology in the arts.
• The U.K.-based Creative People and Places has published a comprehensive report on the approaches, methods and models aimed at evaluating the agencies programs and developed over a three-year period.
• An article published by Journal of Cultural Economics reveals that cultural heritage can play a role in determining where highly skilled individuals live.
• An Ofcom report warns British TV broadcasters they are “failing to represent society” through lack of representation from women, ethnic minorities, and differently abled people.
• A report commissioned by the E.U couldn’t establish a link between piracy and displaced sales of copyrighted film, literature, or video game content, with the exception of recently released top films.
• A recent study argues that foundation-funded nonprofit publications are not the answer to the decline of commercial journalism.
• Publishers are claiming that the Trump era has shifted Americans’ reading habits, but a new HuffPost/YouGov poll suggests otherwise.
• New data from publishers suggests audiobooks are here to stay.
• American Theatre selected the top 10 most-produced plays and top 20 most-produced playwrights for the 2017-18 Season.
• According to a TripAdvisor survey of museums, the Metropolitan Museum of Art is the world’s favorite, capping the site’s top 25.
• Some new research suggests the public still favors artwork created by humans over robot-generated works, ranking those they perceived as computer-generated to be less visually appealing.
• Medical students at the University of Philadelphia who interacted with visual art improved their observational skills.
• An RBC survey confirms substantial losses in paid cable TV, and indicates that the trend is likely to accelerate.
• Pianist and scientist Elaine Chew is creating music made from ECG data, hoping to understanding to patients with arrhythmia diagnoses.
• Austrian researchers are testing technology that facilitates direct brain-to-page music composition.
• Music lessons assist with cognition and decision making, but a new study suggests the effects are greater for those who started training after age 8.
• Classical music is believed to stimulate creativity; a new study points specifically to the baroque era.
• A research study headed by the University of Vienna unveiled “the Bach effect,” which claims that playing classical music in the background can result in women finding men more attractive. BBC Music Magazine recommends Mozart’s Marriage of Figaro, voted the greatest opera of all time by a pool of 172 opera singers.
• New York University discovered some unique musical preferences that are common among individuals with high psychopath scores. So, it’s good news for you if you like “My Sharona” and Sia’s “Titanium,” which were least likely to be favored by psychopaths.

The Diego Rivera Mural at the Detroit Institute of Arts – photo by Quick fix

Each year, Createquity offers a list of the top ten arts policy stories of the past twelve months. You can read the previous editions here: 2013, 2012, 2011, 2010, and 2009. The list, like Createquity itself, is focused on the United States, but is not oblivious to news from other parts of the world. This year, we distributed creation of this list amongst our editorial team more widely than we ever have before, and this is truly a group effort. Authorship of individual items is noted at the end of each paragraph.

In our annual top 10 list of arts policy stories, we often like to point out the implications that non-arts world events have for the arts. In an unusual twist this year, we had a couple of stories in which the art itself was at the center of significant world events. We always knew that art has the power to inspire wonder, hope, greed, fear and anger; 2014 taught us that we can add bankruptcy negotiations and terrorist threats to the list. –Ian David Moss

10. Trey McIntyre Project disbands

In a move that shocked fans and fellow arts administrators alike, Trey McIntyre announced this January that his celebrated eponymous dance company, known as the Trey McIntyre Project, would disband this season, letting him shift focus to new artistic pursuits involving film production, photography, and less frequently, freelance choreography. Begun as a summer touring company in 2005, TMP launched a full-time dance troupe in 2008-09. TMP had been recognized for its innovative choreography and as a model for audience engagement, but most of all for its unusual relationship to the city of Boise, Idaho, which was selected as the new company’s unlikely home after a nationwide search. This arrangement provided TMP with an affordable and livable community, while Boise in turn embraced the company wholeheartedly, treating the dancers like local celebrities and naming the company as its official ambassador. Drawing national attention and funding from creative placemaking initiatives including the NEA’s Our Town and ArtPlace America, TMP had been hailed by many as a model of engagement for the future. Yet McIntyre has said that ending the company was always part of the plan, which is why he decided to call it a “project.” Speaking to Dance|USA, McIntyre said that “the dance company actually went on longer than I had intended. But things were going on really well and I felt it was important to see it through to its fruition and explore every possibility.” From the outside it might look like plenty of possibility was left on the table, but perhaps even in its demise TMP is still a model for the future – that is to say, a model of an organization that knows how to quit while it’s ahead. –Carlyn Madden

9. Transition and renewal for cultural agencies in New York, LA and Boston

In 2014, three major US cities saw a shift in local government leadership, in each case bringing promise and questions for the arts. New York City’s election of Bill de Blasio as its first Democratic mayor in twenty years coincides with a push by the City Council to undertake the Big Apple’s first ever cultural plan. The proposed law charges the city’s Department of Cultural Affairs, led by newly appointed Commissioner Tom Finkelpearl, with developing recommendations for increasing participation in cultural activities throughout the city. NYC is the only one of the country’s top ten municipalities to not have some sort of cultural plan; this bill will hopefully change that when it comes up for a vote in 2015. In Los Angeles, Mayor Eric Garcetti – the city’s first Jewish mayor, and its youngest in a century – opened the year by reshaping the arts conversation, putting emphasis on the fact that the arts are “a value for the entire city government.” In June, he appointed Danielle Brazell, who had previously headed up the city’s arts advocacy organization Arts for LA, to lead the city’s Cultural Affairs Department. But the greatest excitement belongs to Boston, which elected its first mayor last year following the 21-year reign of Tom Menino. The statewide arts advocacy coalition MassCreative took the transition as an opportunity to put culture at the center of the electoral conversation, and its efforts paid off this year in dramatic fashion. In September, newly elected mayor Marty Walsh appointed Julie Burros as Boston’s first Chief of Arts and Culture in more than 20 years, and tasked her with stewarding the creation of the city’s cultural plan. Adding to the sense of momentum, Boston’s Barr Foundation has taken on a newly assertive role in guiding the future of the arts in Beantown, bringing in former Irvine Foundation president James E. Canales and joining the ArtPlace America coalition. –Clara Inés Schuhmacher

8. State arts councils come back with a vengeance

State arts councils had their best year since the turn of the millennium with a nearly 20% increase in funding for FY2015. Total appropriations for arts agencies reached $367.4 million, the highest total (in nominal terms, don’t get too excited) since 2002. The biggest winner was the Florida Division of Cultural Affairs, which had suffered a crippling 94% budgetary cut over a three-year period ending in 2009. The Sunshine State’s arts council roared back this year with a 433% increase, unseating the New York State Council on the Arts as the most formidable state arts council in the country – and with a conservative governor at the helm, no less. California and Michigan also received significant increases in funding, and South Carolina governor Nikki Haley apparently got tired of trying unsuccessfully to veto funding for the state’s Arts Commission as she had done in each of her previous years in office.  With the improving economy, unplanned midyear cuts to state arts agency budgets saw a marked decrease, down to eight states in 2014 from 41 in FY2009. –Louise Geraghty

7. The landscape for film tax credits gets reshaped

After years of what resembled a high-stakes poker game in the competitive environment for film and TV tax incentives, 2014 saw several significant shifts that involved some states upping the ante and others folding their hand. California led the way, more than tripling its tax credit program to $330 million annually in a bid to reassert dominance and keep Hollywood productions in Hollywood. New Jersey’s state Senate decided to play along too, passing a bill that would raise the annual cap for film tax credits from $10 million to $50 million. States weren’t the only ones in the mix: Austin’s City Council approved reimbursement of up to 0.75% of production companies’ wages. Not everyone is drinking the Kool-Aid, however; as John Carnwath writes in “The Bottom Line on Film Tax Credits,” the benefits of film & TV tax incentives to the state and its citizens are not always clear. This year saw North Carolina, Michigan and New Mexico scaling down their programs, citing “concerns [that] the cost to taxpayers outweighed the economic benefits.” Meanwhile, skeptical lawmakers tried to derail Maryland’s tax credit program, prompting a high-stakes standoff with Media Rights Capital and its Netflix show House of Cards that brought out a lobbying appearance from Kevin Spacey himself. An eventual agreement kept House of Cards filming in the Old Line State, but only at the expense of $2.5 million that was transferred away from the state arts fund (and thus many deserving nonprofits!) in a troubling precedent. And even after all that, a nonpartisan analysis from the state’s legislative staff concluded that every dollar invested in the tax credits brought back only 10 cents in revenue. –CIS

6. Bring on the era of Jane Chu!

With the NEA chairmanship open since Rocco Landesman’s retirement in November 2012, the confirmation of Jane Chu to the post was welcome news this June. Chu established her arts career in Kansas City, where she led a $414 million campaign for the establishment of the Kauffman Center and was a key player in the city’s transformation into an arts leader. With a midwestern background, a track record with the business community as a board member for the Greater Kansas City Chamber of Commerce, and previous fundraising success, Chu seems well-chosen for the task of establishing bipartisan support for the arts and countering the impression that the NEA serves a coastal cultural elite. Nevertheless, some wonder if her limited tenure as result of the administration’s long delay in appointing a new leader will give her much opportunity to drive policy at the agency. Chu has not yet announced any new initiatives in her first six months on the job. Meanwhile, the National Endowment for the Humanities also saw a new chairman confirmed this year. William “Bro” Adams comes from a career in academia, most recently as the president of Colby College in Maine, but he may find himself taking on a similar agenda of garnering broad based support and bolstering funding for the humanities. Adams has already announced a new initiative entitled “The Common Good, Humanities in the Public Square.”  –Katherine Ingersoll

5. The IRS haltingly embraces the 21st century

In July the IRS announced major changes to the process of applying for 501(c)(3) charitable status, including a streamlined three-page 1023EZ form for most organizations with gross receipts under $50,000. This bodes well for the backlog of nearly 60,000 organizations waiting for their applications to be processed who will see a dramatic decrease in wait time. The move is in line with a larger trend towards more streamlined processes for the exempt organizations division at the IRS – and, quite possibly, more relaxed enforcement of the rules. The changes come at a time when budget cuts, staff reductions, and political scandals, have stoked concerns about the agency’s regulatory oversight. Government transparency advocates have noted that the dilemma of providing effective regulation with fewer resources could be solved by offering 990 data in an open, searchable format online, distributing some of the IRS’s watchdog responsibilities to donor advocates and the public. (Currently the forms are only available on CDs; GuideStar offers the documents on its website with a 1-2 year delay.) Will the IRS be able to modernize its operations while protecting the public interest? Will your tax forms become shorter, and will there be any staff left to process them? Only time will tell. –KI

4. Russia and Turkey crack down on free expression

Although Russia’s aggression toward the Ukraine has occupied many a news cycle this year, the oppressive measures that Vladimir Putin’s government has taken to reaffirm authority at home, many of which affect artists, have not been as widely reported. Among the more troubling developments is what appears to be a return to the witch-hunt tactics of the Soviet era, publicly naming (and ostensibly shaming) “subversive” artists in print and on television. In July, Putin signed a law prohibiting swearing in public performances (these are the four main offenders), leaving presenters struggling with how best to present planned repertoire. International tensions have affected programming in the US as well – most notably, in April, Washington DC’s Woolly Mammoth Theatre canceled a months-in-the-making festival of Russian theatre, citing loss of previously committed tour funding from the Moscow Cultural Ministry for the 90 artists slated to appear. Putin is not the only national leader to attempt to bend public expression to his will, of course, and he seemingly is inspiring some copycat behavior by Turkish president Recep Tayyip Erdoğan. Coinciding with a sweeping consolidation of power this year, Erdogan’s government proposed a bill in April that would establish an arts council to centralize the disbursement of state funds for artistic activities, effectively giving the government absolute artistic control. The proposed bill has drawn outrage from both the arts community and Turkish citizens, and though still in draft form, the effects of its line of thinking are already being felt, with world-renowned pianists blocked from national performances, and mysteriously cancelled productions at the State Theater. –CIS

3. Net neutrality hangs in the balance

It’s been yet another rough year for net neutrality. In January, Verizon challenged the Federal Communications Commission (FCC)’s 2011 “Open Internet Order” and its authority to promulgate such rules. Verizon won, effectively overturning regulations that require internet service providers to treat all content equally, and setting off a maelstrom of concern around innovation, democracy, and the idea of America itself. Under fire, the FCC proposed new net neutrality rules in March, then again in April (these critics claimed were unworthy of the name), with yet a third draft presented on May 15th. The May proposal, which garnered a whopping 3.7 million public comments over a five month period (680k of which the FCC recently “lost,”) would allow broadband companies to provide a “fast lane” for content providers willing to pay a “commercially reasonable” fee, similar to those that already exist with tech companies like Netflix, Google, Amazon, and Facebook. In December, President Obama and The White House released a plan recommending that the FCC reclassify Internet broadband as a public utility under Title II of the Telecommunications Act, which proponents argue would give the FCC the increased regulatory power necessary to protect net neutrality. Looming large over the debate is the proposed merger of Time Warner Cable and Comcast – the country’s two largest cable companies – and the access implications if approved (the merger would give the new company a stake in 60% of US broadband households.) For now, it’s wait-and-see. The FCC has said it will implement net neutrality rules as early as February 2015, though that likely won’t bring an end to the debate. Whatever happens, someone is likely to sue. –CIS

2. “The Interview” provokes an international incident

Few arts stories in recent memory have involved as much bizarre spectacle as the recent Sony Pictures hack and subsequent fallout. Hollywood is no stranger to poking fun at North Korea (whose leaders are known film buffs); when Team America: World Police lampooned Kim Jong-il in 2004, life went on without much incident. Ten years later, it’s a different story with Seth Rogen and James Franco’s The Interview, which depicts the assassination of Kim’s son Jong-un. After hackers who may or may not have been aligned with North Korea exposed embarrassing emails and data from Sony Pictures, the producer of the movie, the studio and major movie theaters distanced themselves from the film. When the group claiming responsibility for the cyberattack threatened violence, Sony went further, deciding to delay The Interview’s theatrical release and provoking stern words from President Obama himself in response. Subsequently, Sony reversed its decision and released the film online and in select theaters on schedule. Buoyed by the controversy, it is now the most downloaded Sony Pictures film of all time and earned $15 million in its first three days of digital release (along with $3 million through its limited theatrical run) – and no one has yet been injured in a terrorist attack. Now, some people are even speculating that Sony and other major studios might forego a traditional theatrical release in the future in favor of going directly to online outlets. One thing we’re pretty sure about: never before has a story engaged computer geeks, homeland security experts, celebrity gossip hounds, and arts marketers with such equal intensity. –LG

1. Detroit’s art leads the Motor City out of bankruptcy

News about the Detroit Institute of Arts (DIA) made our “Top Ten” list in 2012 and in 2013. Let’s hope 2014 – as it reaches the dubious honor of No. 1 – marks its last appearance for a while. After two years, Detroit’s long and painful bankruptcy battle finally came to a close in November with a federal ruling in favor of the city’s bankruptcy plan. For this Detroit has, in many ways, the DIA to thank. Under the so-called “Grand Bargain,” an $816 million deal developed by the Ford, Kresge and Knight Foundations, among others, the foundations will provide funding for Detroit’s public pensions – a key component of the negotiations. The only catch? Control of the DIA must be transferred from the City of Detroit (which has owned the museum since 1919) to an independent charitable trust, thus protecting the art from being auctioned off to the highest bidder. Previously, Detroit’s state-appointed emergency manager Kevyn Orr had included the museum’s art collection among city assets available for liquidation, and contracted Christie’s to appraise portions of the 60k+ piece collection. Detroit city creditor Financial Guaranty Insurance Co. even went as far as to solicit bids for the DIA’s entire collection, receiving four separate offers to buy the art outright for as much as $2 billion. That a museum and its art could become the linchpin of a federal bankruptcy negotiation, soliciting intense interest from creditors and rallying outside philanthropic interests to its rescue, is truly remarkable. Would a “Grand Bargain” — and a Detroit with its dignity left intact — have even been possible without the DIA? Luckily, we won’t have to find out. –CIS

Honorable mentions:

• Drama at the Metropolitan Opera, Atlanta Symphony, and San Diego Opera
• The Cultural Data Project’s strategic reboot
• August Wilson Center sold to Pittsburgh foundations
• US Department of Arts and Culture gets up and running

Happy 2015 to all!

The Detroit Institute of Arts’s Woodward entrance. (Image courtesy the Detroit Institute of Arts)

After a two-year battle, a federal ruling to approve Detroit’s bankruptcy plan brought to an end the threat to auction off the Detroit Institute of Arts’s collection. The plan includes the “grand bargain,” an $800 million deal that partly consists of a $366 million investment from the Ford Foundation, Kresge Foundation, Knight Foundation, and other heavy-hitters. In the bargain, DIA supporters are providing funding to save Detroit’s public pensions, with the caveat that DIA be administered by an independent charitable trust, and not by the City of Detroit, which has owned the museum since 1919. While all hail these developments as positive, DIA still has a tough road to financial stability ahead. As it looks to shore up its finances and secure its future by raising its endowment to $400 million, DIA faces hefty legal bills incurred during the bankruptcy battle, and the daunting task of fundraising from donors whose pockets may have been emptied into the grand bargain. Regardless of what the future holds, the foundations will be keeping a close eye on their investment–the Knight Foundation’s Dennis Scholl has been appointed as an observer of DIA’s board.

Publisher Hachette Wins the Right to Set E-Book Prices from Amazon: In a multi-year agreement, “Big Five” publisher Hachette won the right to set prices for e-books from Amazon, which had attempted to pressure the company to price all e-books at $9.99. The retail giant suffered in the court of public opinion for its strongarm negotiation tactics, including long shipping delays of Hachette books, disallowing advance sales, and steering customers to similar books by other publishers. Some authors are calling for Amazon to be investigated on anti-trust grounds; at the same time, Amazon has questioned the need for traditional publishing houses in the digital era. While all sides seem to be breathing a sigh of relief over the deal, it seems clear that the fight isn’t over–publishers have long had a difficult relationship with digital retailers, and observers are think the next negotiation may be just as acrimonious.

Mid-Term Elections Offer Mixed Results for the Arts: In case you were living under a rock last month, we had some elections and the Democrats lost their shirts. So what does that mean for the arts? With the Republican-majority Congress, Americans for the Arts forecasts the passage of a comprehensive tax reform bill, which will likely impact charitable giving rules. The chairship of the subcommittee that oversees funding for the Arts in Education will change, while Representative Ken Calvert (R-CA) will continue to govern the subcommittee that controls the National Endowment for the Arts budget. Barry Hessenius predicts a possible attack on the NEA’s budget, given its symbolic weight for some in Congress, and recommends that arts leaders work to build stronger relationships with our elected officials. Meanwhile, at the state level, arts-friendly candidates suffered losses in Illinois, Massachusetts, and Maryland. In better news, Rhode Island passed a ballot referendum providing $35 million in bonds to renovate arts facilities in the state, and pro-arts measures passed in Palm Beach County, Salt Lake City, Scottsdale (AZ), and Middlesex County (NJ).

Three Foundations Purchase Pittsburgh’s August Wilson Center: The embattled August Wilson Center for African American Culture now rests in the hands of three foundations, which purchased it for $7.9 million from Dollar Bank, its mortgage holder. The Pittsburgh Foundation, Heinz Endowments, and Richard King Mellon Foundation had attempted to close on an $8.49 million deal by October 31, but the sale was torpedoed when a creditor appealed an earlier $200,000 judgment in the Pennsylvania Superior Court, and the foundations refused to proceed until the debt was settled. Dollar Bank was forced to move ahead with a foreclosure auction on November 3, which cleared the Center of its debt and allowed the foundations to complete their purchase.The Center plans to re-open in 2015 under new nonprofit leadership and will continue its mission as a focal point for African American arts and culture.

Obama Says the Internet Should Be Treated as a Public Utility: Net neutrality supporters got an unexpected boost from President Obama this November. The White House released a plan recommending that the Federal Communications Commission reclassify Internet broadband as a public utility under Title II of the Telecommunications Act, which proponents argue would give the FCC the increased regulatory power necessary to protect net neutrality. The president seems to agree with this line of thinking — his administration’s plan also rejects the FCC’s proposed rules to allow for paid prioritization of Internet traffic. Just after the President’s announcement, though, FCC Chairman (and Obama appointee) Tom Wheeler stated that he favored a different approach, one friendlier to the concerns of large Internet service providers like Comcast, AT&T, and Time Warner. The Washington Post speculates that Obama’s announcement may merely represent shrewd political positioning, since if the FCC enacts strong rules, and the Republican Congress votes to overturn them, a presidential veto would put Obama and the Democrats squarely in the camp of millions of voters who have asked the FCC for powerful net neutrality protections.

MUSICAL CHAIRS/COOL JOBS

• Indonesia has named the U.S.-educated Anies Baswedan as the new Minister of Culture and Elementary and Secondary Education.
• The NEA’s Director of Folk and Traditional Arts Barry Bergey will retire after 29 years of service.
• Chorus America is seeking a new President and CEO. Posted November 22, closing date December 19.
• Kansas City’s Charlotte Street Foundation is looking for a new Director of Artists’ Programs. Posted October 29, no closing date.
• The Foundation Center is hiring for a Director of Community Foundation Services position. Posted November 4, no closing date.
• The Barr Foundation seeks an Arts and Culture Program Assistant. Posted November 20, no closing date.

NEW RESEARCH OF NOTE

• A study by the U.S. Trust finds a big bump in charitable giving among wealthy donors in 2014, and projects further growth.
• New research from the Bureau of Labor Statistics shows that nonprofit employment rose during the recession.
• The BFAMFAPhD collective published Artists Report Back: A National Study on the Lives of Arts Graduates and Working Artists, which asserts that “the fantasy of future earnings in the arts cannot justify the high cost of degrees.”
• The researchers behind the Crystal Bridges field trip experiment that we reported on back in October have released another study, this time focused on high-quality theater productions.
• A report by the U.S. Department of Agriculture looks at how well rural areas with a higher proportion of “creative class” workers fared during the recession.
• Suby Raman takes a deep dive into gender representation in America’s top orchestras.
• New research from Italy indicates that those with a need for “cognitive closure” are less likely to appreciate abstract art.

A group of onlookers tours the plant in a detail of Diego Rivera’s Detroit Industry, the centerpiece of the Detroit Institute of Arts. The mural was completed during the city’s heyday as auto capital of the world. Photo credit: grifray

Since last May, the Detroit Institute of Arts (DIA) has been at the center of bankruptcy negotiations between the beleaguered City of Detroit and a myriad of creditors and pensioners to whom a staggering $18 billion is owed. When Kevyn Orr, Detroit’s state-appointed emergency manager, included the museum’s art collection among city assets available for possible liquidation, the suggestion that the artwork might be sold to satisfy creditors sent shudders through the art community. Could a world-class art museum, part of America’s cultural foundation, be raided, its cultural treasures sold off to pay the debts of its city? And what would that mean for other art institutions around the country?

The story has captured the attention of the powerful and common alike, with many weighing in on the whether the collection should or would be sold. But even before Emergency Manager Orr brought in Christie’s auction house in August to evaluate the art, a group of influential and deep-pocketed DIA supporters had begun to assemble. Federal bankruptcy mediator U.S. Chief District Judge Gerald Rosen gathered a group of national and local charitable foundations in November to brainstorm and discuss “out of the box” ways to prevent the DIA from being gutted, while still protecting city pensions. The result of Judge Rosen’s roundtable has been nothing short of extraordinary and could have long-term implications for the role of charitable foundations in the future.

Last month, a group of ten foundations with close ties to the city joined ranks to develop an unprecedented rescue plan. Led largely by the Ford Foundation, the consortium has pledged to give $370 million to the city pensioners’ fund under the condition that ownership of the DIA’s collection is transferred to a separate nonprofit organization, thus protecting it from the city’s creditors. With the foundations’ commitment in place, the State of Michigan has also stepped in with its own pledge of $350 million, pending approval by the Legislature. Governor Rick Snyder described the offer as a “settlement” rather than a city bailout and it comes with another caveat: pensioners must drop all lawsuits against the city.

The amount of money flowing in to save the DIA, largely from sources outside of Detroit, is breathtaking in its grandeur. The Ford Foundation’s pledge of $125 million is more than a quarter of its entire grantmaking budget in fiscal year 2012. In second and third place are the Kresge Foundation with $100 million (a whopping 70% of its 2012 giving) and the Kellogg Foundation at $40 million. These developments make for quite a story and may provide comfort to those who feel the 139-year old art museum should be left intact. And yet this sudden infusion of cash raises a number of important questions for the arts field and for the institution of private philanthropy alike.

For example, is the foundations’ commitment to the DIA a distraction from other, possibly better giving opportunities, whether in Detroit or elsewhere? Mariam Noland, president of the Community Foundation for Southeast Michigan (CFSEM), reported receiving concerned calls from cultural organizations worried their usual grant funds would be diminished as a result of the foundation’s pledge. However, CFSEM and the other foundations claim they are working to ensure this does not happen, either by stretching their contribution payments out over 10-20 years or tapping into their own endowments – another questionable move. Several of the foundation leaders involved – Noland, the Kresge Foundation’s Rip Rapson, the Knight Foundation’s Alberto Ibargüen, and the Ford Foundation’s Darren Walker – wrote an op-ed for the Chronicle of Philanthropy defending their decision, writing, ”our support…aims to accomplish something even larger: helping a great city get back on its feet quickly and on course toward a better future.”

So just how far will the coalition go to protect the DIA from any long-term financial burden Orr tries to impose on it? Historically, charitable foundations like to avoid quick-fix approaches when it comes to supporting public institutions, favoring innovative policy reforms that promote social change instead. However, here, they are bargaining with Detroit’s pensioners, taking a risk, and potentially opening themselves up to a future of wheel-and-deal funding schemes. Indeed, some in the grantmaking world are already voicing concerns about the precedence of conditional giving being set and whether it “amounts to philanthropic coercion rather than generosity.”

Between the foundations and the state, the total amount put forward now surpasses the $500 million contribution requirement Emergency Manager Orr had originally placed on the DIA. And the museum just recently agreed to raise an additional $100 million itself over the next 20 years, bringing the grand total to $820 million – all of which would be disbursed to the pensioners’ fund. If all parties accept this amount and Orr’s plan, then the City of Detroit would immediately transfer ownership of the entire art collection and building to the DIA, the private non-profit that has actively managed it for decades, thereby bringing a swift end to an at times harrowing situation.

But how much danger was the DIA ever in, really? All of the drama of the past year notwithstanding, the DIA hasn’t had any ultimatums placed upon its collection by Judge Steven W. Rhodes, who is presiding over Detroit’s case in federal bankruptcy court. In December, Christie’s auction house completed its appraisal of roughly 2,800 artworks – comprised solely of pieces purchased with city funds so as to avoid any legal action by donors and their heirs. Christie’s estimated the art to be worth between $452-866 million, with a couple of standout pieces valued at nearly $150 million apiece. The assessment was not music to the ears of creditors, who—their hopes no doubt bolstered by multi-billion dollar speculations made in the media early on—accused the city and auction house of purposefully undervaluing the artwork. The consortium of European banks, bond insurers, Detroit retirees, and labor unions requested that an independent committee conduct a separate review of the museum’s full collection – approximately 66,000 pieces, 95% of which were donated or purchased with private funds. Judge Rhodes has since refused the creditors’ request, ruling that he doesn’t have the authority to permit an independent evaluation of the DIA’s entire holdings.

Rhodes has furthermore said he is seriously considering the formal opinion issued by Attorney General Schuette back in June, which declared that the DIA’s collection, though technically owned by the city, is held in a “public trust” and therefore off limits to creditors. If he does agree that the collection is held in a public trust, it would mean the artwork is legally off the negotiation table.

A couple poses in front of the south wall of Detroit Industry. To the left, images of fertility preside over the larger frescos depicting the auto assembly line. Photo credit: Lars K. Christensen

In the final days of 2013, I took a quick trip to Detroit to visit the museum in question, a reconnaissance mission to experience the day-to-day reality of the institution under threat. It was heartening to see that the DIA was absolutely packed with people on the Friday after Christmas. The clerk at the ticket desk informed me that there would be a live concert that evening in Rivera Court, the large atrium home to Diego Rivera’s masterful work Detroit Industry. Executed from 1932-33, the mural was gifted to the DIA by Edsel B. Ford himself. Unanticipated by Ford, however, was the artwork’s socialist overtones, which caused quite a stir at the time it was created. Sited right at the core of the sprawling museum, the mural depicts the auto industry and its workers as the “indigenous culture of Detroit,” using the literal representation of manufacturing to achieve metaphors of power and growth. From floor to ceiling, assembly line workers dominate the scene in numbers and fortitude, while images of fertility—fruits, grain, mothers, and infants—preside overhead. Standing there dwarfed and surrounded by its twenty-seven boldly painted fresco panels, Detroit Industry makes palpable the heart and soul of the once-thriving metropolis whose influence has extended far beyond its city limits.

Despite the very real concerns that have arisen over the philanthropic “rescue mission” to save the DIA, private donations, both large and small, continue to come in from around the world. It seems that, through its ordeal, the DIA has unexpectedly become the public face of the city of Detroit. Its recent plight is a symbol of the gradual destruction of a cultural and economic legacy rooted in the early years of the 20th century, the so-called American century. As the city painfully negotiates the resolution of the narrative at play in Rivera’s masterpiece, the rest of us are provided with an opportunity to reflect on that legacy – not just the art collection, but how an important American city came to be. It seems that by preserving one, the hope is we save the other.

The Thinker at the Detroit Institute of Arts – photo by Quick fix

Each year, Createquity offers a list of the top ten arts policy stories of the past twelve months. You can read the previous editions here: 2012, 2011, 2010, and 2009. The list, like the blog, is focused on the United States, but is not oblivious to news from other parts of the world. I am grateful to Createquity editorial consultant Daniel Reid for contributing the entry on the arts and the GDP.

This year provided us with a mix of hope and stress. While boasting its share of concrete triumphs and failures, such as the launch of several field-building initiatives and the very high-profile flaming out of the venerable New York City Opera, 2013 was most notable for providing us with markers along the path of longer-term trends. With the struggles of the Great Recession largely behind us, arts stakeholders increasingly turned their attention to non-financial matters, planning for the future and seeking to invest wisely. Yet the specter of fear and dysfunction in Washington, DC hung over the arts field to a degree not seen since at least the Bush years, sapping enthusiasm from even the most passionate of government idealists.

10. Changing of the guard at ArtPlace

As noted in last year’s top stories roundup, creative placemaking was cruising for a bruising in 2012. While a number of factors contributed to the backlash against the signature arts policy push of Rocco Landesman’s tenure as NEA Chairman, by many accounts, the brusque style of ArtPlace’s founding director Carol Coletta didn’t help. Under her leadership, ArtPlace – a private-sector collaboration between 13 of the nation’s largest arts funders initiated by Landesman and the Ford Foundation’s Darren Walker – came under fire for failing to disclose its funders’ geographic restrictions, missing opportunities to thoughtfully measure creative placemaking’s impact, being cavalier about gentrification and other social justice considerations, and supporting a project that alienated the people it was trying to help. In the midst of all this, Coletta decamped for a VP position at the Knight Foundation in March. Her eventual replacement announced in December, following an interim stint by former William Penn Foundation president Jeremy Nowak, was the NEA’s Chief of Staff Jamie Bennett, who had ingratiated himself with arts stakeholders across the country in his now-former position and earned widespread admiration in the process. Change is in the air at ArtPlace (the organization is moving with Bennett to New York, for one), and many eyes are watching the fledgling creative placemaking standard-bearer as we head into 2014.

9. City Opera bids farewell

Amidst near-death experiences far and wide, New York City Opera is the biggest and most famous U.S. arts institution yet to actually fail as a result of the Great Recession. The once-mighty company, which had visions of a $60 million annual budget as recently as 2008, had drastically scaled down its ambitions following a disastrous season during which it presented no full productions, lost its (brand new) general director, and managed to draw down or lose the majority of its endowment. By the time George Steel took over in 2009, most of the damage had been done, and City Opera could no longer afford its just-renovated home at Lincoln Center. A last-ditch effort to raise $7 million (including a first-of-its-kind-at-this-scale “save the opera” $1 million Kickstarter campaign) fell short, and the organization announced it was beginning bankruptcy proceedings in October.

8. Arts’ impact on GDP gets counted

Advocates at Americans for the Arts, the NEA, and elsewhere have spent years touting the arts’ economic impact, on the theory that legislators and executives will find this argument singularly compelling and respond by taking their fingers off the “defund” button. This year, their case got official recognition from the Bureau of Economic Analysis (BEA), which calculates GDP. First, in July, the BEA revised its methodology for calculating GDP to include the money businesses spend to develop intellectual property, including artistic work like music and film; this added 3% to our nation’s economy overnight and underlined the economic importance of investment in creative work. Then, in December, the BEA and the NEA jointly released the first-ever official tally of the value the arts add to the U.S. economy, which they will continue to track annually (note that this does not yet take into account the methodological changes announced in July). The total – $500 billion a year, more than the entire tourism sector – impressed some mainstream news outlets and was promptly put through the spin cycle by a few creative-industry advocates, especially in Hollywood. But the bigger surprise was how little excitement the story seemed to generate in arts circles – perhaps because of the report’s bad news about the arts’ post-recession recovery, the fact that commercial fields accounted for the bulk of the value, or the omission of ancillary spending (such as on dinner before the theater) that often figures prominently in more localized economic impact studies.

7. The arts (start to) get serious about diversity

Yeah, yeah, I know. Talk is cheap, and our field has been dithering about multiculturalism, demographic change, and the need to diversify boards, staffs, and audiences for decades. Looking beneath the surface of the blogosphere debates, however, one does get the sense that momentum for action is growing. 2013 was the year of the inaugural SphinxCon, a convening on (racial) diversity in the performing arts spearheaded by a man who was almost the next Chairman of the NEA (more on that below), and the leaders of numerous relevant service organizations showed up to put their views on the record. One of those service organizations, Theatre Communications Group, is now a year into an extensive and very public “diversity and inclusion” initiative and the conversation is bubbling up at other service organizations as well now that financial survival is no longer everyone’s first priority. Meanwhile, Grantmakers in the Arts had its entire board undergo training by the People’s Institute of Survival and Beyond, a leading purveyor of anti-racist thought. These are small steps in the grand scheme of things, and diversity is not the same as justice, but one can’t help but be encouraged watching the organizations charged with leading the field begin to walk and not just talk.

6. The arts research field makes halting progress toward field-building

Last year, I got so frustrated with the state of arts research that I blathered on for more than an hour to the University of Chicago Cultural Policy Center about all of its problems and how to fix them. Fortunately, it turns out that I’m not alone in seeing the need and opportunity for reform of our field’s research infrastructure. The first and easiest step toward a better future was always going to be a way for people working in this area to communicate more effectively with each other, and May’s launch of the Cultural Research Network goes a long way toward checking that box. This was also the year that the arts began to flirt in a big way with Big Data. We saw the launch of two immense arts data aggregation initiatives, Philadelphia’s CultureBlocks (building off of the work of Social Impact of the Arts Project researchers Mark Stern and Susan Seifert) and Southern Methodist University’s National Center for Arts Research (aggregating data from the Cultural Data Project, TRG Arts, and elsewhere). A third project, the Harvard-led Initiative for Sustainable Arts in America, is set to launch in Detroit and the Bay Area in 2014. Meanwhile, the aforementioned Cultural Data Project is taking a look in the mirror with a gigantic, year-long strategic planning process that looks like it will result in major changes for the organization and the field. We’ve got a long, long way to go, but the progress we saw in 2013 toward a smarter, more tech-savvy, and more collaborative knowledge management infrastructure in the arts is highly encouraging.

5. The NEA remains Chairless

When Rocco Landesman left his post as chairman of the National Endowment for the Arts in December 2012, there was no reason to think that the leadership transition would be anything but smooth. Senior deputy Joan Shigekawa, who had long been rumored to be the one running the agency behind the scenes anyway, became the acting head, and a search for a new director began immediately. Yet as the year dragged on, the process became murkier, and at this point no one seems to be sure when the Obama administration (which is in charge of the search) might get around to formally nominating a new leader. Sphinx Organization founder and National Council on the Arts member Aaron Dworkin is the only individual to have publicly confirmed being a candidate for the gig and was widely seen as the frontrunner for the post until he pulled his name from consideration over the summer; he would have been the Endowment’s first black chairman. NEA fans can take heart at least in the fact that they are not alone; the National Endowment for the Humanities has likewise been without an official leader since May.

4. A roller coaster year for the DIA

My goodness, where to begin? The Detroit Institute of Arts has had more ink spilled on it in the last two years, it seems, than Brad Pitt and Angelina Jolie. It was just last August that the DIA was triumphantly celebrating the passage of a millage, or property tax, in three counties providing the institution with ten years of guaranteed operating support, allowing it to build its endowment and place itself on secure footing for the future. But then in July the City of Detroit announced that it was filing for bankruptcy, placing the DIA’s art collection – much of which is owned by the city – in jeopardy. The city’s state-appointed emergency manager, Kevyn Orr, has reportedly asked the DIA to come up with $500 million to help appease creditors and lead Detroit out of the doldrums, which is about how much the auction house Christie’s has assigned to the value of artworks purchased with city funds. The most interesting potential outcome has the city and the DIA entering into a “grand bargain” involving an effort to raise the $500 million from a consortium of local and national funders, including the Kresge and Ford Foundations, and turn the DIA into a private entity, free from city control. Regardless of how this one turns out, it’s an object lesson in the potential pitfalls of direct government involvement in arts institutions.

3. Edward Snowden shows us we’re not as free as we thought

A 30-year-old former government contractor running off with four laptops and goodness knows how many hard drives’ worth of secret intelligence documents made for a compelling news story, but its connection to the arts wasn’t immediately clear. After all, the initial disclosure – that the United States National Security Agency was working with phone companies to collect metadata (information about calls, though not the calls themselves) en masse – seemed like it might be No Big Deal. It’s helpful for our national security apparatus not to have to wait for days to know who’s called whom, they still have to get a warrant to figure out what was actually said, and it’s all cleared by the Congress and our courts. Right? But as more and more revelations from Snowden’s treasure trove have come to light, the creepier this whole thing has gotten, and the more it’s become apparent that virtually nothing we do online is secret from the government. The NSA has intercepted the fiber-optic cables that carry Internet traffic to collect information on activities without the Internet companies even knowing; the agency “repeatedly broke surveillance rules,” and there have already been cases of “willful misconduct” like stalking love interests. Here’s what’s important to keep in mind from an arts perspective: the United States has always prided itself as a country of free expression. One of the most important ways in which that freedom of expression has been possible is that the government has intentionally held back from giving itself the means to control it, letting social norms and the marketplace have influence instead. There may be little reason to think that Uncle Sam would be interested in some random artist’s work today, but imagine a change in administration, another war, and a widespread movement for social change in which artists play a big role, and all of the sudden 2013 might start to look a lot like 1983.

2. Obamacare gets off to a rocky start

For years, advocating for health care reform was a major priority of a number of arts organizations. Once the Patient Protection and Affordable Care Act was passed, several of those organizations (including the one that I work for) took the opportunity to declare victory and go home. Pretty much no one considers Obamacare to be perfect, but the legislation had been widely praised and its rollout highly anticipated in arts circles because of its promise to better serve freelancers, particularly those with modest incomes (due to the subsidy provided). However, when healthcare.gov couldn’t process enrollments to save its life upon its October launch, it all started to look very, very fragile – particularly the already popularity-challenged individual mandate that is, according to economists, the linchpin to the entire system. It looks like the worst fears about Obamacare’s shaky launch have passed, but not before a small business exchange and the employer mandate were delayed for a year and other concessions were made to mollify angry citizens, many of which are arguably bad policy. Make no mistake, the Affordable Care Act is here to stay – but how much it’ll actually end up improving things is perhaps a bit more in question than it seemed a few months ago.

1. Wait, who elected these guys?

When the dust from the 2012 election cleared and Barack Obama was still president, the Senate was still Democratic, and the House was still Republican, we knew we were in for another two years (and most likely four) of divided government. But I don’t think too many people expected it would get this bad. The hyper-partisan environment, political infighting between conservative and establishment Republicans, petty power struggles between branches of government, and the determination to treat even the smallest difference of opinion as a virtual fight to the death all contributed to one of the least productive Congressional years in recorded history and a 16-day government shutdown that earned the ridicule of the world. As much as this sucked for all of us as citizens, it all but put the kibosh on any dreams of transformative arts policy coming from the Obama administration. With so many urgent national priorities getting in line to be ignored or gamed by a Congress that is far more adept at drafting press releases than passing legislation, maintaining the status quo is about the best that arts advocates can hope for in 2014.

Honorable mention:

• Scandal at the IRS
• Darren Walker lands Ford Foundation’s top gig
• The sequester hits federal arts agencies

Happy 2014 to all!

ART AND THE GOVERNMENT

• The value of the creative sector to the U.S. economy? Half a trillion dollars. The value of the Bureau of Economic Analysis’s official inclusion of our sector in its GDP analysis? Priceless. Responses from the field have been mixed. Some are celebrating how full the glass is: the creative sector, led by Hollywood, advertising, and television, accounted for 3.2% of the economy – more than tourism (2.8%) – and employed 2 million workers. Others have focused on the top half of the glass: the recession hit our sector especially hard and to lasting effect, and the bulk of the economic value is from advertising, with relatively little from “independent artists and performing arts.” Still others question the value of glasses entirely: embracing economic measurements of the arts could undermine aesthetic arguments for their necessity – though Createquity’s Jena Lee recently suggested otherwise.
• In the latest installment of the Detroit Institute of Arts saga, museum leaders have joined closed-door negotiations with several of the nation’s largest private foundations, both local and national, to protect the beleaguered institution by raising a whopping $500 million for the city’s underwater municipal pensions. Sources say they could be close to a deal. Meanwhile, efforts to raise private funds to spin the museum off from the city got a boost from biotech millionaire Paul Schaap, who has pledged $5m.
• The Marion Ewing Kauffman Foundation has released a policy paper detailing several strategies for mayors and local government to support cultural entrepreneurship.
• A new report published by old friend Shannon Litzenberger intends to “ignite a conversation about addressing the existing logjam in arts funding in [Canada].”
• Arts Council England wants the the field to “transform itself into a low-carbon, sustainable and resilient sector” — so much so that it requires environmental reporting of its grantees, and is out with a summary of the first year of that effort.
• The Seattle Department of Cultural Affairs is offering $10,000 for an action plan on a Cultural Development Certification — intended to be the arts’ parallel to the LEED designation. Proposals are due January 22.

MUSICAL CHAIRS

• Deborah Rutter, President of the Chicago Symphony Orchestra, will succeed Michael Kaiser as President of the Kennedy Center in DC, with potential implications for classical music programming.  This leaves a number of important vacancies at the capital’s cultural institutions, including the Smithsonian, the Hirshhorn, the Corcoran, the board of the Kennedy Center itself – oh, right, and both the NEH and NEA.
• Detroit’s Michigan Opera Theatre has found its first President and CEO: Wayne S. Brown, current director of music and opera at the National Endowment for the Arts. David DiChiera, the Theatre’s founder and general manager, will transition to serving as artistic director beginning January 1. Brown’s departure continues a recent exodus of top NEA officials, including the directors of Theatre & Musical Theatre, Literature, and Public Affairs/Chief of Staff.
• John Maeda, president of the Rhode Island School of Design and prominent advocate of “STEAM” education, is leaving his post at the end of the semester to join a venture capitol firm and consult for eBay – right as eBay announces plans to follow Amazon’s footsteps and launch an online art marketplace.

ALL ABOUT THE BENJAMINS

• Debate over effective altruism is raging on, and not just in the arts. Charity Navigator President and CEO Ken Berger slams it as “defective altruism” in a blog post for Stanford Social Innovation Review, and 80,000 Hours co-founder William MacAskill counters. Lest the bickering ruin your holiday spirit, GiveWell released its top charities of 2013 (no, the arts are not included) along with a thoughtful set of notes from staff members on where (and why) they each plan on giving this year.
• The Hewlett Foundation has announced a new grantmaking priority to promote an American governing process that is more productive, more civil, and less polarized.
• A new Center for Effective Philanthropy survey suggests that most foundation CEOs are skeptical that real progress has been made against the major problems they are tackling, but that their own organizations have made substantial contributions. Lucy Bernholz points out that they also lack confidence in their own measures of success and wonders whether boards can effectively hold them accountable.
• Speaking of Bernholz, her annual list of philanthropy’s top buzzwords is out for 2013 and might just be the perfect gift for the “makers” and “solutionists” on your list this holiday season.

IN THE FIELD

• Louisiana ArtWorks, a lavish $25 million art studio construction-project-turned-fiasco that has stood nearly empty since its completion, is up for auction. On top of the $600,000 yearly mortgage left to New Orleans taxpayers, more than $15 million state and federal funds had been sunk into the project.
• A new 300-student charter school for the arts is set to open on the site of a former department store in Fayetteville, North Carolina.
• In the rare positive story from Motown, the Detroit Symphony Orchestra is back in the black after a lengthy and debilitating musicians’ strike three years ago. Meanwhile, musicians from the Minnesota Orchestra, having spent the last year locked out in a labor dispute, are going rogue by applying for a 501(c)(3) and organizing their own concert series.
• Philadelphia has been adjusting to the shifting priorities of three major local arts funders, and Peter Dobrin details the ramifications and changes in a three-part series.
• The History Colorado Center takes “visitor tracking” to a new level with a “business intelligence” system that integrates and mines data from all areas of the museum, including “who is visiting, whether they’re members or donors, whether they’re coming as families or in adult pairs or alone, and from where… Whether those visitors eat in the café or shop in the store, what they ate and what they bought.” Not creepy at all…

BIG IDEAS

• With the National Endowment for the Arts gearing up to announce new collective impact funding for arts education next month, now’s a great time to brush up on what collective impact is – and while you’re at it, dig into this new series on measuring backbone organizations’ success.
• Beth Kanter unpacks the developmental evaluation strand of last month’s Next Generation Evaluation conference and offers some insight on its relationship to social change initiative and nonprofit practice.
• The Los Angeles County Museum of Art is partnering with Google, Accenture and other for-profit companies to launch an art and technology lab that will “will award grants and make museum facilities available to help artists explore new boundaries in art and science.” Elsewhere in LA, though, the public school system’s efforts to equip classrooms with iPads seem to be suffering from One-Laptop-Per-Child-like problems, which one pundit blames on “innovation fatigue.”
• Real-estate developers are increasingly cultivating artists and designers as tenants in low-rent neighborhoods who will help transform the area, raise the rents, and eventually move out. One developer calls the process “gentlefication.”
• Now this is a different kind of conference report: Arts & Ideas has created a gorgeous interactive document of The Art of Placemaking conference hosted last month in Providence, RI by the folks at WaterFire.

RESEARCH CORNER

• Dallas’s National Center for Arts Research has released its inaugural report on the health of America’s arts and cultural organizations. The report includes the average performance of organizations in eight indices and an examination of what drives organizations, and introduces the concept of high performance and intangible performance indicators (KIPIs). NCAR is working with IBM to create a online dashboard for organizations to access their own KIPIs.
• Roland Kushner, co-author of Americans for the Arts’ National Arts Index, looks at the relationship between private sector giving and arts index scores between 2000 and 2011. He finds a correlation beyond charitable contributions to the arts increasing the vitality of the sector, arguing that “charitable giving and engagement in the arts may emanate from the same instincts, values, and attitudes.”
• Americans love libraries! Nearly half of adults have visited a library in the past year, and fully 90% believe their community would be adversely affected if the local branch closed, according to a Pew study.
• A new study from Germany suggests that the relationship between studying music and improved academic performance may be causal: when researchers controlled for differences such as parental background, student musicians still out-performed their peers on cognitive tests – especially verbal ones.
• Some interesting findings have been reported by psychologists studying the effects of first-person shooter games. They surmise that players who enjoy these immersive and violent games are satisfying an innate desire for control and split-second decision making that is rarely achievable in today’s society. Video games also got some support from a new study out of Israel’s Center for Educational Technology.
• Korea-Finland Connection, a collaboration between Korean Arts Management and Dance Info Finland, has published an evaluation of its three-year program intended to create long-term  relationships between Finnish and Korean artists and organizations in the performing arts.
• Half of Equity members in Britain earned less than $8,200 in the last year, according to the union’s latest survey.  Additionally, “95.8% said they had never been pressurised to appear nude at a casting.”

Edvard Munch’s The Scream (1893) was stolen along with his Madonna (1894) from Oslo’s Munch Museum in 2004. After the theft, the combined value of the artworks was assigned retroactively at $121 million.

Christie’s auction house is wrapping up four months of appraising artworks at the Detroit Institute of Arts (DIA), which has become an unfortunate hostage in negotiations between the bankrupt City of Detroit and its creditors. When the city’s Emergency Manager, Kevyn Orr, brought in Christie’s in August, there was an outcry of disapproval from the public and museums across the country. Marion Maneker of Art Market Monitor described the general sentiment this way:

If you allow Detroit to appraise its art… you’re simultaneously devaluing the importance of art and culture and opening the door to further kleptocratic appropriations from the “public trust.”

Orr has said that he expects the DIA to find a way to raise money from its collection, which may mean a sale of some works at auction. However, the objections are not just to potential deaccessioning (the controversial practice of selling of a work in a museum’s collection), but even to the very notion of assigning an estimate of market value to works of visual art. Maxwell Anderson, Director of the Dallas Museum of Art, compared Christie’s process to “the weighing of souls” and expressed concern that it would “alter…the public’s perception of artworks from being ciphers of public heritage of transcendent value, to objects for sale to pay other people’s debts.”

Protests against the valuation of art in public institutions are not new. Once an artwork has made it behind the pearly gates of a major museum, it is generally considered to be off limits to market forces forever, preserved and protected for the benefit of all. The arguments for this view usually echo the opinion that art’s intrinsic and cultural importance render it priceless, so assigning a price would profane this sacred value.

But are these fears of assigning dollar amounts to artworks warranted? As an associate in the field of fine art appraisal, I take issue with the notion that art could be kept separate from economic value and market forces, even if we would like it to be – and I question the underlying belief that assigning price and respecting “transcendent” cultural value are mutually exclusive. As one municipal bankruptcy expert asserted, “You can’t pretend the art doesn’t have monetary value.” I would go further and say that we should be glad it does.

How Much Is It Worth?

The systematic valuation of artworks in a major museum’s collection is unusual. Even in the DIA’s case, Christie’s is only appraising a select group – less than 5% of the collection – comprised of works purchased directly by the City of Detroit. However, art museums, their collections, and exhibitions have always been intertwined with the art economy. Deaccessioning is one obvious point of intersection, but even setting the sale of art to the side, museums actually assign market value to works all the time, particularly when they acquire or loan them out.

A museum typically acquires work either through a direct purchase made with a combination of its own money and donor funds or via a donation from a private owner. In both instances, the artwork enters the collection with a price attached. In the case of a purchase, curators will examine the historical and aesthetic importance of the artist and her past market activity to justify to their director and board the need to spend a certain amount on a new acquisition. In fact, rising market prices for a less established artist’s work can actually be a signal that she is worth considering for acquisition in the first place. Pop over to the website for Boston’s Museum of Fine Art for an interesting peek at one museum’s acquisition policy (and visit it again for more insights on provenance, which we’ll get to in a bit).

In the case of a charitable donation to a nonprofit institution, the Internal Revenue Service requires that the artwork be professionally appraised upon acceptance to determine its fair market value, defined as:

The price that property would sell for on the open market. It is the price that would be agreed on between a willing buyer and a willing seller, with neither being required to act, and both having reasonable knowledge of the relevant facts.

This valuation provides the basis for the tax break the donor will receive. To ensure he doesn’t scam the system with an inflated value, this type of appraisal uses a market data approach that includes prices of “comparable examples” or sales of the artist’s work in recent years. The appraisal also incorporates any pertinent information on the state of the art market at the time of the gift with regard to the artist, as well as a biography and testament to her relevance in relation to a particular art movement or period. In other words, the appraiser must prove the fair market economic value of the work as it relates to its cultural value in order for the IRS to accept the designated price.

These values are not static; they change with inflation, the ebb and flow of the market, and trends in the art world, which is why private collections are reassessed on a regular basis for insurance purposes – another moment at which monetary value is assigned to art. Perhaps surprisingly, most art museums do not insure their full collections, which would be prohibitively expensive. Instead, individual artworks are insured only when they leave their permanent homes, usually as part of an exhibition or occasionally for conservation. At that time, the works are re-appraised, their value once again determined to guarantee full coverage in the case of damage or loss, such as theft. If either occurs at home where the work is uninsured, the piece will be appraised retroactively for what it would have been worth at the time of the incident.

In 2004, Edvard Munch’s The Scream (1893) and Madonna (1894) were stolen from the Munch Museum in Oslo. After the heist, their combined value was set at $121 million. The works were later recovered, but without an art appraisal, insurers would have been unable to determine how much to compensate the museum. By establishing the market value of an artwork, an organization can give itself options should the unforeseen occur. The money recovered from insurers will generally be put towards repairing any damages incurred, or if that’s not possible, acquiring another art piece. Both measures clearly benefit the collection and the public trust.

Exhibition History and Provenance

Museums don’t just establish the price of the art in their collections, they also help determine the value of works they never even consider buying. An artwork’s economic value is affected by its exhibition history and provenance—where it was shown, where it was written about, and by whom it was owned—so it’s in a collector’s best interest that it be seen in the right company.

When it comes to exhibitions, it is standard practice for museum curators to approach collectors about lending artworks for inclusion in upcoming shows featuring the artist’s work or area of influence. The wall text adjacent to an art piece in an exhibition can be a useful tool for illuminating the subtle presence of the art market in the room. Next time you attend a museum show, pay close attention to the last line of this catalogue description. If the provenance states, “From the collection of…” you can smile and nod with the knowledge that the lender has just added a feather to the artwork’s proverbial cap, an advantageous qualifier should he ever wish to sell it.

The cultural seal of approval that an art institution can issue extends beyond the objects within its own collection and those lent for exhibitions. It can affect an artist’s entire oeuvre, increasing the value of un-exhibited privately owned works as well as new ones offered for sale. One gallerist promoted the work of Israeli artist Leora Laor to a client by informing him in a letter that the The Jewish Museum was considering the purchase of Laor’s photograph Borderland #1006. In this case, the gallerist felt that even interest on the part of a museum would be a factor in the collector’s decision. Similarly, a well-received exhibition about a particular period or style can cause a flurry of buyer activity in the retail sector, as happened with a 2006 traveling showcase of 19^th-century Biedermeier fine art and furniture that was hailed in the New York Times as a “a harbinger of many things modern.”

An installation view of “Biedermeier: The Invention of Simplicity” at the Milwaukee Art Museum in 2006. Photo credit: Chris and/or Kevin

On occasion a museum may mount a show comprised solely of works owned or donated by one collector – a practice sometimes referred to as a “vanity exhibition.” If the collector is still living, the museum may enter into the preliminary stages of acquiring his collection or first right of refusal, wherein they show the work in exchange for donations of art or a cash gift. The collector/donor benefits by adding exhibition history and provenance to his artworks and glory to his legacy, while the museum in theory benefits by expanding its collection – although the artwork may or may not eventually end up there. The Los Angeles County Museum of Art came under fire for agreeing to a 2001 exhibition of works from trustee Eli Broad’s collection without procuring a contract ensuring that some pieces would be donated to the institution. LACMA never received any of the work—Broad decided to open his own museum—but prior to that he made a $60 million contribution for a contemporary art wing bearing his name.

The incident with Broad points to the complex relationship nearly all art museums have with deep-pocketed benefactors positioned behind the scenes as trustees, committee members, and influential donors. It’s difficult for their personal and financial interests not to get entangled with the institution and their collections, which is why museums must walk an ethical tightrope when it comes to public-private partnerships. While their presence ensures that the museum will always be indirectly tied to the marketplace, it also allows institutions a certain amount of autonomy from the limitations of government funding and it can even offer protection for works of art under threat. In the case of the DIA, for example, Emergency Manager Orr and the city’s creditors have largely shied away from the majority of the collection that was donated or acquired with private funds, lest donors and their heirs unleash a slew of lawsuits similar to the one recently filed (and later retracted) by two founders of the Dia Art Foundation in New York.

The Art in Art Appraisal

We’ve examined some of the ways market value and museums intersect, but who exactly is appraising all of this artwork? Is it a group of sticker-happy thieves who will sell world-class art like your Nana’s cheap china at a yard sale? Absolutely not. Art appraisers are also art appreciators. They have a discerning eye for the energy of the brush stroke, effect of light, complexity of composition, and artist’s intent. Most hold degrees in areas of art, history, and cultural studies, as well as economics and administration. The principal appraiser at the firm I work for is a contributing member of several Los Angeles-area art museums, an owner of a diverse collection of paintings and “tramp art,” and has consulted on several art books and catalogues. If you’ve ever watched Antiques Roadshow or History Detectives, you get a pretty good idea of the level of an art appraiser’s interest and knowledge in the work he or she evaluates. Even auction catalogues feature special spreads that include artist’s biographies and attest to the cultural relevance of particular works for sale.

Contrary to fears that dollar signs will devalue art’s intrinsic qualities, those of us who are in the business of knowing the most about its market value are devoted museum patrons, members, collectors, and even artists ourselves – as in my own case. We are deeply aware of what makes an art piece valuable in a cultural context and worthy of its place in a museum.

But what about the broader public? Could highly publicized, often astronomical market prices for significant artworks lead to a general sense that art is only as valuable as the dollars it can be exchanged for? There is reason to believe that the risk is low. Even as New York Times art critic Roberta Smith bemoaned the “new high-water mark”—$142,000,000.00!—set by the recent sale of Francis Bacon’s Three Studies of Lucian Freud, she pointed to a 1980 purchase by the Whitney Museum that made headlines at the time. The prestigious art institution bought an encaustic painting by Jasper Johns called Three Flags for an era-shocking $1 million. But no one talks about that when they see the work hanging in the museum today. It has weathered the once negative press resulting from its hefty purchase price remarkably well, becoming a popular icon of American 20^th Century art.

Jasper Johns’ iconic work Three Flags (1958) was purchased by the Whitney Museum in 1980 for $1 million.

A recent survey of Detroit citizens suggests a similar public resilience to artwork valuation. Despite the high estimates that have been tossed around in the media, reportedly 78% of locals surveyed would prefer not to sell the DIA’s art to satisfy city creditors, despite the city’s dire economic straits. And in another interesting development, Detroit’s creditors have accused Christie’s of undervaluing DIA artworks, the appraised portion of which are preliminarily estimated at $452-866 million. Their disappointment in the early assessment reveals how a prudent appraisal is less about giving the “kleptocrats” what they want than determining a value that accurately reflects the arts’ cultural and historical position within a market.

So if monetary value need not displace aesthetic or cultural value, it seems to me that we want art to be prized in the marketplace – which also means being priced. Though it may seem tasteless to talk cold hard cash when it comes to our cultural heritage, monetary worth is one of the most direct ways in which our culture speaks about things it truly values. Rather than trying to avoid pricing art all together—nearly impossible in a late-capitalist society—it might be more productive to think like an art appraiser and ask why the work is worth what it is at this particular moment in time. Examining the reasons reveals a lot about our cultural interests, state of the economy, and wealth distribution. The ability of an art collection to capture the attention of an American city’s creditors is disconcerting as a sign of culture’s vulnerability when our urban centers are poorly managed, but for a field constantly beset with worries of its declining relevance and difficulty reaching a broader audience, the public’s subsequent resistance in letting that artwork go should be something for arts lovers to celebrate – a sure sign that people really do care after all. In the opinion of this art appraisal associate, a world in which the price of certain artworks is ludicrously high is far less scary than a world in which no one is willing to put a price on art at all.

• A consortium of City of Detroit creditors have made the first legal move towards pressuring the Detroit Institute of Arts to sell city-owned artworks to help pay for debts owed. Executive Vice President Annemarie Erickson defends the museum against Emergency Manager Kevyn Orr’s demand that the museum find one way or another to contribute $500 million in assistance to the bankrupt city.
• The California Arts Council will apply a $2-million funding windfall it received from Assembly member John Perez to several new initiatives in arts education and community improvement, including Creative California Communities, The Arts in Turnaround Schools, and Jump stARTS. In the face of a 7.6% budget cut handed down last year, the state arts council is taking a gamble on the success of these programs winning fresh credibility with policymakers and an increase in annual funding.

MUSICAL CHAIRS

• Jamie Bennett, chief of staff and director of public affairs at the NEA, will take over as executive director of the creative placemaking funder collaboration ArtPlace America starting in January. He succeeds ArtPlace’s founding director Carol Coletta, who joined the Knight Foundation back in March, and interim head Jeremy Nowak.
• After a decade serving Californians as president of the James Irvine Foundation, James E. Canales will step down in the spring to become the first president of another arts funder, Boston’s Barr Foundation.

• There has been some shuffling in the world of state and local arts councils. Ohio Arts Council ED Julie Henahan has retired after thirty years; Milton Rhodes, President of the Arts Council of Winston-Salem and Forsyth County in North Carolina, has retired and been succeeded by Jim Sparrow; and Glenda Toups was dismissed from her position as ED of the Houma Regional Arts Council in Louisiana in the wake of the discovery by the board that the Council was not in compliance with state reporting law.

• We’ve known for a while that Michael Kaiser is leaving his post as President of the Kennedy Center for the Performing Arts; now it turns out he’s taking the DeVos Institute of Arts Management with him. Both are moving to the University of Maryland, where Kaiser will be a professor of practice beginning in the fall, and hopes to expand the Institute to include a master’s program.
• Financial news giant Bloomberg has decided to discontinue its cultural journalism brand, Muse, in favor of focusing more on leisure and luxury. Along with the reassignment of Muse editor Manuela Hoelterhoff and a cadre of employees and contracted writers, the news outlet laid off theater critic Jeremy Gerard.

ALL ABOUT THE BENJAMINS

• The Hewlett Foundation has announced a rigorous new “Openness and Transparency” policy, which assumes from the outset that information the foundation creates should be made public to improve outcomes, spark debate, and foster collaboration. Hewlett’s President Larry Kramer offers context in a post on the foundation’s new blog; transparency watchdogs celebrate the policy.
• The D5 Coalition has released a scan of best practices and a guide to online resources for foundations wishing to advance diversity, equity, and inclusion at every stage of their work.

IN THE FIELD

• Eric Booth and Tricia Tunstall share profiles of El Sistema “encounters” in five of approximately 55 countries – Sweden, Austria, Korea, Japan, and Canada – that have borrowed from Venezuela’s seminal movement to realize youth development goals through “intensive investment in ensemble music.” The global umbrella for El Sistema has also released the first literature review of “research, evaluation, and critical debates” related to Sistema-inspired programs around the world.
• The Arts Council of Lawrence, New Jersey has shut down after 42 years, having, in the words of one member, “outlived [its] usefulness.” Originally formed by a group of female volunteers, the Council struggled to recruit younger members throughout the recession.
• The August Wilson Center for African American Culture in Pittsburgh is struggling mightily. After a struggle to find an audience and keep backers the organization has been forced to move further and further from its original intention to create a cultural home for the people portrayed in Wilson’s plays, working class African Americans. A conservator has been appointed to try to avoid liquidation.
• The Warehouse, an all-ages music venue in La Crosse, Wisconsin, has filed to become a nonprofit after 22 years as a for-profit, prompting some musicians to wax lyrical about their time there. Financial pressures were the primary impetus, but owner Steve Harm has indicated he will open the space to the local community in new ways to provide a public good.
• Fractured Atlas has added another tool to their encouraging-and-rewarding-arts-entrepreneurship tool belt. The Arts Entrepreneurs Awards will recognize artists and arts organizations who have “innovated new business practices or paradigms” or  “developed novel solutions to old problems.” Nominations will be accepted until December 22nd at 5:59pm.

BIG IDEAS

• A report from the Next Generation Evaluation Conference forecasts “game-changing” trends in impact evaluation, including shorter evaluation cycles and simpler measurement systems.
• “Is social practice gentrifying community arts out?” Arlene Goldbard parses the difference between the art world’s latest obsession and community cultural engagement.

RESEARCH CORNER

• Southern Methodist University’s National Center for Arts Research is about to release its inaugural report, drawing on what it calls the “most comprehensive set of data ever compiled” on arts organizations.  In addition to a statistical overview of the field – did you know that performance of an arts organization is lower in communities with a higher concentration of graduate degrees? – the report attempts to answer the question, “What makes one arts organization more successful than another?” The key turns out to be leadership.
• Speaking of data aggregation, Markets for Good has a progress report on the BRIDGE (Basic Registry of Identified Global Entities) project, an ambitious collaborative effort to identify and map philanthropic entities across the world.
• A new report by the Consumer Federation of America bashes “abuse of market power by a highly concentrated music sector,” argues against the need “to expand copyright holders’ rights,” and suggests that digital file-sharing (aka “piracy”) may, in some cases, actually be good for both artists and consumers. One well-circulated chart suggests that it is the proceeds of live performance, not recordings, that drives artists’ income.
• Gold standard at Crystal Bridges? In a rare, randomized, controlled (albeit “natural”) experiment on the effects of art on students, a single school-group visit to the major new museum appears to have raised students’ scores on vague but desirable traits such as critical thinking, social tolerance, historical empathy, and likelihood of future museum visits. It’s too soon to parse out the effect of contemporary art in particular.
• A study of STEM graduates from the Michigan State University’s Honors College found that graduates who went on to earn patents or start companies had more arts and crafts experiences than the average Americans – and believed their ability to innovate was influenced by that experience. (The paper itself is behind a paywall.)
• How “rampant” is gentrification? New research suggests that most urban areas experienced only “moderate” gentrification in the past decade, with significant variations across cities. Unsurprisingly, gentrification was most prevalent in large and dense metro regions with solid public transit infrastructure.

Auguste Rodin’s “The Thinker” (1904) greets visitors at the entrance to the Detroit Institute of Arts. The famous bronze was gifted to the museum in 1922. Photo credit: Quick fix via Flickr

Recent threats placed upon the Detroit Institute of Arts (DIA) have thrust the topic of deaccessioning once more into the popular spotlight. The DIA and its collection are owned by the City of Detroit, which has struggled financially for decades and was recently assigned a city emergency manager by the state’s governor Rick Snyder.  In July, upon reviewing the city’s fiscal situation, the newly appointed emergency manager Kevyn Orr declared Detroit bankrupt. The federal government subsequently decided against bailing out the once mighty auto capital. Facing an estimated $18 billion in debt, creditors and pensioners are now hungrily eyeing the city’s various cultural, natural and infrastructural assets for potential liquidity. Among them is the DIA’s art collection, which has a market value estimated at anywhere from $2 billion to “the low to mid-11 figures.”

Those dollar signs are juicy enough to make any Detroit creditor’s mouth water, but it is important to remember that many of the holdings were donated to the museum under legal contracts with donors that ensured they would never be sold. An attempt to do so would likely result in multiple lawsuits filed by donors and their heirs. With those works legally safeguarded, the pieces most desirable to creditors are those that were bought by the city directly. Unfortunately for the DIA, these purchases comprise an important part of its collection.

Indeed, emergency manager Orr has already hired Christie’s auction house to appraise approximately 3,500 of the Detroit-purchased pieces. Among the lot are significant works by Brueghel, Tintoretto, and Matisse with estimated values reaching as high as $150 million each. These astronomically priced paintings are the superstar outliers within the 60,000 plus item collection, and they are the works most often cited as part of any prospective—and controversial—sale. There is no precedent for so many masterpieces being sold simultaneously, and there are fears amid the collector and auction community that a sale of this magnitude would depress the art market.

“The Window” (1916) by Henri Matisse was purchased by the City of Detroit in 1922 and reportedly has a market value of $150 million.

For the moment, the artwork is not under any immediate threat of seizure. The DIA has claimed the collection is in a public trust, legally defined as “a trust created for promotion of public welfare and not the benefit of one or more individuals.” The state’s Attorney General Bill Schuette echoed this sentiment in a formal statement issued in June. Although an Attorney General’s opinion traditionally carries significant legal weight, it is a possible that a court could overturn it, and creditors may seek just such a ruling if push comes to shove.

Should a court rule in favor of the creditors, selling the artwork to pay off the city’s debt would quite literally betray the public’s trust—though perhaps not the way that has deaccessioning foes concerned. The DIA is the beneficiary of a homeowners’ tax, or millage, passed just last year by voters in three counties to ensure it stays open and accessible to local residents. In fact, in response to recent developments, Oakland County’s Art Institute Authority recently passed a resolution calling for the termination of its contribution to the millage if a sale or leasing of any artwork goes forth. The other two counties, Wayne and Macomb, could follow suit. Without the levy, the museum would face a reduction of hours and museum exhibitions, at the very least.

Since Orr mentioned the collection as a potential asset back in May, battles of opinion have been waged between cultural critics and commentators that have resulted in an art world panic over the disbursement of the collection. In lieu of retired city employees facing reductions in their pensions, one prominent art critic suggested the collection be sold as a preventative measure, only to be browbeaten into switching his opinion.

At the center of these debates is the code of ethics of the American Alliance of Museums (AAM), which states that a museum’s collection may be sold “solely for the advancement of the museum’s mission . . . to be used consistent with the established standards of the museum’s discipline, but in no event shall [proceeds] be used for anything other than acquisition or direct care of collections.” The Association of Art Museum Directors (AAMD) upholds a similar ethical standard. In June, the Michigan Senate voted to approve a bill stating that all art institutions must adhere to this code. The art authority bill still has to be voted on by the House of Representatives when lawmakers return from their summer break, but one wonders if writing the AAM code into law is the right course of action.

Both the bill and Oakland County’s decision to end the millage pending a sale are intended to protect the DIA’s and taxpayers’ interests. But what happens to an institution whose hands have become tied legally? How will it affect the museum’s ability to decide what is best for it in the future?

In a Createquity post this May, Tegan Kehoe suggested “making responsible efforts to keep [deaccessioned] objects in public hands” as a reasonable standard that should avoid the worst outcomes of deaccessioning. But the proposed restrictions being placed upon the DIA would forestall even this approach. Let’s say the DIA wanted to invest in the goodwill of Detroit’s citizens by prudently selling or leasing artworks to other nonprofit institutions to help the city recover. According to Elliot Bostwick of Boston’s Museum of Fine Arts, as quoted in the New York Times, most museums only exhibit between two to four percent of their collection at one time. It’s entirely possible that among the museum’s more than 60,000 works—some of which will never be exhibited—there are items that no longer support the DIA’s vision. If executed carefully, a sale of these holdings could be seen as an act of generosity on the museum’s part and actually benefit the institution over the long term, while ensuring that the deaccessioned works remained accessible to the general populace. Yet with the art authority resolution in place and counties threatening to remove taxpayer support, the DIA could be held hostage by the very laws designed to protect its interests. (Indeed, director Graham Beal is now asserting publicly that “selling any art would be tantamount to closing the museum,” in no small part because of the millage situation.) There is an upside to allowing public institutions to police themselves via trade groups like AAM and AAMD.

From Kevyn Orr’s perspective, there are surely quicker and more efficient ways to raise funds for the bankruptcy proceedings than plundering works from the DIA. Some of those options include sale of the Coleman airport, Joe Louis Arena, Detroit-Windsor Tunnel, Belle Isle Park, parking operations, city-owned land, and the water and sewer department. Each of these assets comes with its own particular set of issues, but none seems quite as legally challenging as liquidating the DIA’s art collection. With museum advocates rallying for their cause and the press hot on Orr’s heels, any sale by the DIA, small or large, is becoming less likely by the day. Deaccessioning opponents may find reason to rejoice in that outcome, but whether it’s ultimately a good thing for the City of Detroit—or the DIA for that matter—is still a question worth asking.

• The Future of Music Coalition has a great roundup of takeaways from a recent congressional hearing on copyright law and the technology sector. Big ones include the very different challenges posed by copyrights versus patents, and that for the most part, technology companies don’t see copyright restrictions as stifling their ability to innovate.
• A new arts center in New York City (and the whopping $50 million in city capital funding that’s making it possible) has Mayor Bloomberg’s fingerprints all over it.
• Reason #22 to think twice before moving into a glass house: the New York State Supreme Court has ruled that a artist was well within his First Amendment rights when he took and then exhibited photographs of his neighbors — including two small children — inside their glass-walled home from across the street. Upon recognizing their images in an advertisement for the upcoming exhibit, the neighbors had attempted to sue the artist for invasion of privacy and emotional distress.

MUSICAL CHAIRS

• Katy Locker will join the Knight Foundation as its Detroit-based program director; she is currently VP of Programs at the Detroit-based Hudson-Webber Foundation. In an interview with former ArtPlace CEO Carol Colletta, she lists the arts as one among several “levers to continuing Detroit’s turn around.”
• Lisa Hall will become VP for Programs at Houston Endowment. She comes from YES Prep Public Schools, where she was VP for Talent Support and General Counsel.
• KPAC, a classical radio station in San Antonio, has cut its five local hosts to reduce costs and will use a syndicated service from Minnesota. The station has offered the hosts part-time work; so far, only one, Dierdre Saravia, has accepted.

ALL ABOUT THE BENJAMINS

• Newly-appointed Ford Foundation President Darren Walker offers three lessons on philanthropy: collaborate broadly, as the Edna McConnell Clark Foundation did in the Harlem Chlidren’s Zone; invest in due diligence into grantees to ensure leaders are both passionate and adequately supported by their organizations; and recognize that the kinds of metrics used to measure success in business won’t apply in many philanthropic contexts.
• Grantmakers in the Arts continues to take a more activist stance regarding cultural equity. Earlier this summer, the entire GIA board of directors underwent two days of anti-racism training led by the People’s Institute for Survival and Beyond. A similar two-day workshop (though led by a different group) will be offered to grantmakers attending this year’s GIA conference in October.

BIG IDEAS

• Organized labor is declining, the nonprofit sector is expanding, and two may well meet in the middle. Employees at a homeless service nonprofit in San Francisco successfully unionized in June, signaling what might be the beginning of a broader trend.  And while unions have been getting a bad rap recently this article points out that “the mission-driven nature of nonprofits can prove to be an asset in providing an alternative model to the us-versus-them framework adopted in most private sector organizing.”
• Angie Kim shares two great examples (both arts-related) of nonprofit membership associations, typically ill-equipped to drive sector-wide change, assuming a leadership role at the risk of alienating members or compromising revenue streams.
• Half of Barry Hessenius’s “Dinner-vention Party” guests offer their thoughts on how the arts can address declining audience numbers and shifting participation in truly new ways. This first batch includes “briefing papers” by Laura Zabel, Kimberly Howard, Clayton Lord, Margy Waller, Tamara Alvarado, and Nina Simon.
• What happens when video-game designers become auteurs? In the case of Thatgamecompany’s Jenova Chen, the artists reworks his art many times before releasing it to get the “emotional impact right,” his company goes bankrupt as the project runs over schedule and over budget – and the final product becomes a critical darling, breaks sales record, and wins its creator a $5.5m venture-capital investment.

IN THE FIELD

• A new movement in the architecture and design field builds on LEED certification’s environmental standards, and calls for a triple-bottom-line approach that takes social factors into account as well.
• Amazon has launched Amazon Art, a partnership with more than 150 galleries that allows you to browse, purchase and review (or faux-review) fine art much as you would a kitchen appliance. At least one blogger isn’t impressed, noting, “Much as I admire [Amazon’s] shipping practices… why compete in a market where an awesomely speedy physical delivery network means next to nothing?” Speed might not matter here, but access to artwork—especially for people who don’t live in major urban centers – might.
• The community-supported agriculture model is being transferred to the arts in cities including Pittsburgh, St. Paul and Flint. Most of them are visual art-specific, with at least one performing arts version as well. And they never have to worry about getting too much Swiss chard…

RESEARCH CORNER

• The Strategic National Arts Alumni Project (SNAAP) has updated its annual survey of arts alumni. SnaapShot 2012 presents the results in attractive infographics, and SNAAP’s 2013 annual report interprets the data. The theme of the report is inequalities among graduates of diverse backgrounds. Findings include a lack of access to networks among black and Hispanic arts alumni, which disproportionately discourages these alumni from becoming artists; and persistent pay gaps between male and female graduates.
• The Australia Council for the Arts has released a new study of the Australian arts sector in 2012. The report is bullish: attendance at arts events is up by about 3.5%; box office across genres was up 16% (only theater box office declined); and private sector contributions held steady.
• GlobalGiving, GuideStar, the Foundation Center, and TechSoup are collaborating to create an international registry of philanthropic entities. The project, funded by the Hewlett and Gates Foundations, will develop a system of unique identifiers and establish a database for information like the nature and location of philanthropic work.
• A new paper from Yuan Ji, an attorney for Wilson Sonsini and recent Yale Law School graduate, examines the conversion of Burning Man from for-profit to nonprofit status.
• Do copyright laws “make books disappear”? A researcher examines the numbers of books available in print over the last two hundred years, and finds they tend to vanish quickly, only to reappear later when they fall into public domain.
• A new study found that undergraduates tended to like the paintings of the critically-respected 19th-century artist John Everett Millais more with repeated exposure – but they liked the work of the popular but less canonical Thomas Kinkade less the more they saw of it. This is in tension with previous research into the “mere exposure effect” that found that  familiarity just about always breeds affection, even for lesser Impressionists.