Museum Misery: Illinois Institutions Dealt Dwindling Endowments

Dec 1, 2009

The Art Institute of Chicago. North View of Michigan Avenue Facade, courtesy of the Art Institute of Chicago.
Credit WUIS/Illinois Issues
Hours cut. Salaries trimmed. Pay frozen. Staff reduced. An exhibition canceled in part because of budget woes. Sharply reduced endowments have forced Illinois museums into distasteful decisions over the past year.

“I’m not trying to put any icing on this. It’s been a difficult time. The most difficult time in my 30-year career in museums,’’ says Jim Richerson, president and CEO of the Lakeview Museum of Arts & Sciences in Peoria.

Illinois is home to hundreds of museums that range from the small and highly specific — such as a Decatur establishment that honors the inventor of the water tap — to the major institutions on Chicago’s lakefront that host millions of visitors each year. Most of those that Illinois Issues contacted have suffered the consequences of the sharp decline in their endowment funds and/or dwindling government support at a time when attendance has remained steady or even increased. 

“A lot of museums have been affected by the economic downturn, from institutions as big as the Field Museum down to the small, local historical society. Those of us who have investments and endowments, and who rely on that to help us with the day-to-day operations, are facing some pretty steep challenges right now,” says David Oberg, immediate past president of the Illinois Association of Museums. 

For instance, Chicago’s Field Museum had an endowment of $320 million at the end of 2007. By the end of 2008, it had dropped about 35 percent to about $210 million, says executive vice president Jim Croft. That meant less money to support the museum’s $68 million operating budget.

Jim Nutt, Sally Slips Bye-Bye, 1972. Acrylic on canvas. The Art Institute of Chicago, gift of the Robert A. Lewis Fund in memory of William and Polly Levey.
Credit Jim Nutt / The Art Institute of Chicago

  This year, the Field — in part because of budget concerns — canceled its planned fall exhibit of Lucy, the 3.2 million-year-old fossilized remains of a hominid. The museum also reduced its staff by 100 through attrition or the end of a grant. Salaries were frozen for employees earning less than $75,000. Those paid more than $75,000 took a 3 percent pay cut, and the highest earners, members of the executive staff, had a 5 percent salary reduction. Field president James McCarter decreased his $450,000 salary by 20 percent “to show his commitment to the institution,” Croft says.

The Art Institute of Chicago saw its endowment drop 23 percent in the fiscal year that ended June 30. Salaries were frozen. Employees were told to take a week’s leave of absence by March 2010. The museum’s president, James Cuno, took a 10 percent cut to his salary, which was reported in a 2008 tax form as $500,000.

“If you look at this statewide, a lot of institutions are having to tighten their belts right now. They’ve looked at their interest earned from their endowments as a way to augment their operating budgets, and now they’re finding there isn’t as much to go to,’’ says Oberg, who is president of the Geneva History Center. “They’re having to cut back on staff, cut back on hours. At the end the day, most nonprofits basically just get by year to year. Then you add this in, you’ve got to cut back. You’ve got no choice.”

The Lakeview museum in Peoria lost 25 percent of its endowment— or $543,000 — last fiscal year, which ended June 30. In response, the facility was forced to reduce its hours for eight months of the year.

“Last year, as we saw things coming undone, we saw a $90,000 gap in our budget,” says Richerson, the museum’s president. The museum also cut back on supplies, staff development and began charging for some programs. “None of the these things I like to do, but at the end of the day we are a business and need to operate responsibly.’’

Oberg notes that many institutions are delaying maintenance and new projects. “They’re just trying to do more with less, looking for every way they can save a couple of pennies.”

The ailing economy hurt museum budgets in Illinois in more ways than one.

“When the market tanked, a lot of [museums] saw their investments just evaporate overnight. And then you add to the fact that a lot of them, including ourselves, rely upon donations, and a lot of their donors had that happen in their personal lives, too. It’s sort of a double whammy if then you add the fact a lot of us apply to foundations. They also have their own endowments and investments that have been affected. That’s one more way we’re facing some challenges right now.” The loss of donor dollars is even more difficult for small to medium-sized museums that lack endowment funds, Oberg says.

Frank Lloyd Wright, Avery Coonley Playhouse: Triptych Window, 1912. Clear and colored leaded glass in oak frames. The Art Institute of Chicago, Restricted gift of Dr. and Mrs. Edwin J. DeCosta and the Walter E. Heller Foundation.
Credit Frank Lloyd Wright / The Art Institute of Chicago

  Museums that rely on public funding for the entirety of their operating budgets were pinched as well. In late 2008, then-Gov. Rod Blagojevich closed half of the state’s historic sites. Although Gov. Pat Quinn reopened the sites in the spring, the Abraham Lincoln Presidential Library and Museum in Springfield and the 60 historic sites are working with reduced budgets. The Jubilee College State Historic site in Peoria County is closed, the Carl Sandburg Home in Galesburg is open only on weekends and the Washburne House in Galena operates only on Fridays. “This is all because of staffing issues tied directly to the budget situation,’’ says Dave Blanchette, spokesman for the Lincoln library and museum and the state’s Historic Preservation Agency.

This year, the Lincoln museum had an operating budget of $14.2 million, but its administrators were told to hold a share of that money in reserve because of the state’s fiscal problems, Blanchette says. Just $11.6 million is available. Meanwhile, $7.3 million is expected to be spent at historic sites, as compared with the $9.2 million initially budgeted.

“We’ve been having fewer special events, fewer artifacts are being brought in and we’re not filling a number of vacancies,’’ Blanchette says.

Other museums have seen public funds dwindle as well, notes current Illinois Association of Museums president David Becker. “All our organizations really rely very heavily on individual and public support,’’ he says, noting that most Illinois museums get some type of public funding, such as from park districts, municipalities and the state and federal governments. 

For those entities that rely on the state for the majority their funding, the future is murky at best.

Dona Bachman, director of the state-funded University Museum and the Museum Studies Program at Southern Illinois University Carbondale, says:“I think we’re going to have serious cuts university wide, and as a part of the university, we could experience cuts, too. I don’t know. Things are certainly up in the air. Everyone is trying to figure out the best way to deal with that situation.”

Meanwhile, museums are seeing steady interest from the public, notes Gary Johnson, president of the Chicago History Museum and president of Museums in the Park, a consortium of 10 museums on Chicago Park District property. “Interest in the public remains strong. It’s a sign of the troubled economy that people look to education and culture to restore their souls.’’

Becker concurs. “Most of the people I’ve talked to say their visitorship is just as high as it ever was, maybe even higher. It’s an inexpensive way to spend quality time with your family.’’

And while the stock market has seen growth in recent months, museum officials say that the effects of the recession will have an impact for some time to come because many plan finances in multiple-year scenarios.

“The markets have made a spectacular recovery,” which has helped endowments, Johnson notes, “but the economy as we know it remains weak.”

Oberg says, “Until we see the unemployment picture brighten a little bit, you’re still going to see a lot of those organizations facing some steep challenges. It’s just a tough environment to fundraise in now.’’

However, “I do think there is hope. Just because times are tough doesn’t mean we stop doing what we do. It’s more important than it ever was before.”


Museum links

Abraham Lincoln Presidential 
Library and Museum 

The Art Institute of Chicago

Chicago History Museum

The Field Museum

Illinois Association of Museums

Lakeview Museum of Arts & Sciences

Museums in the Park

Southern Illinois University Museum


Illinois Issues, December 2009