Three of Baltimore's largest and most prominent arts organizations -- the Baltimore Museum of Art, Center Stage and the Walters Art Gallery -- will receive grants of $1 million each as part of a far-reaching program to insure the health of major arts institutions nationwide.
The grants will be announced today by the New York-based National Arts Stabilization Fund (NASF), a 10-year-old organization that has so far awarded $20.9 million to arts institutions from Seattle to New York City.
In Baltimore, the $3 million represents a sizable contribution to the three arts organizations, which have annual budgets of $4 million to $8 million. The money will provide capital reserves to help the institutions plan for the future and to bolster them during periods of tight money.
"This is tremendously important to all of the institutions who qualified for the grants," said Kate Sellers, acting director of the Walters. "NASF support offers in some ways the most difficult type of money to raise, that which bolsters the infrastructure of the organization."
The grants are one step in a decade-long process by which the NASF rewards arts institutions for refining their finances.
In Baltimore, the process has involved a $4 million local fund-raising effort (including $1.75 million from the Abell Foundation) and an additional $2 million from the NASF. Although two thirds of the $6 million total is raised locally, the NASF board must approve all grants.
Aside from the grants announced today, three other local arts institutions are targeted for future funding from that $6 million -- the Baltimore Opera Company, the Baltimore Symphony Orchestra and the Maryland Institute, College of Art, according to the NASF.
As of now, the symphony and the institute have budgets large enough to make them eligible for $1 million grants. The opera probably would be eligible for a grant of about $600,000.
Today's grants, to be announced at a World Trade Center reception at 5 p.m., are the largest amounts the NASF awards.
The money, to be distributed over five years, can only be used to help pay off a deficit and establish a reserve fund. Historically, the financing has been awarded to well-established organizations in relatively strong financial health, said Leonard Vignola, NASF's president and chief executive officer.
"In Baltimore you have solid organizations [whose] attitudes about management and planning to improve and grow soundly are excellent," said Mr. Vignola, who will make today's announcement. "We work as a catalyst and on a real partnership basis in an attempt to help them strengthen themselves from a fiscal management standpoint. This is not a quick fix, and our grant is not an operating grant."
Baltimore grant recipients admit the NASF process is long and difficult but worthwhile.
"You hate it at the beginning, but it pays off tremendous dividends," said Ms. Sellers of the Walters, which has an annual budget of $6.9 million.
Arnold Lehman, director of the Baltimore Museum of Art (BMA), said, "There certainly have been frustrations . . . [but] I feel better about where we are than where we were." The museum's annual budget is $8 million.
Even though Center Stage went through a similar process with the Ford Foundation years ago, the theater's managing director, Peter W. Culman, said qualifying for an NASF grant "represents the toughest and deepest refining we've ever been through. . . .
"It takes an immense amount of time, and it's burdensome in one sense, and yet the reason for the burden is to keep you healthy. It's like, are you willing to do your exercises every day and watch your diet because you'll be healthier."
Center Stage's budget is just over $4 million.
The Baltimore project is the latest launched by the NASF, which was founded in 1983 with funds from the Ford Foundation, the Andrew W. Mellon Foundation and the Rockefeller Foundation.
31 arts institutions
Including today's grants, the NASF has so far awarded $20.9 million to 31 arts institutions in Boston, Kansas City, Arizona, Seattle, New York and Baltimore. It has pledged a total of $36.4 million for the six project sites.
Grant recipients can use the NASF money for two purposes. Part of it can be used to match funds they raise to eliminate current deficits. Although neither the Baltimore Museum of Art nor the Walters has a current deficit, Center Stage will use $145,000 of its grant to retire half of its working capital deficit.
The rest goes into a capital reserve, granted over five years. This fund can be tapped for projects, such as planning a season, but it must be repaid each year. It makes the institution its own lender, rather than borrowing money and paying interest.
To be nominated, institutions must meet rigorous NASF guidelines. Each must have an annual operating budget of at least $500,000, nonprofit status, a diversified base of support, audited financial statements, and a current deficit of no more than 25 percent of operating expenses for the preceding fiscal year.
By NASF standards, the six Baltimore nominations were the only ones here that qualified, according to Joseph M. Langmead of KPMG Peat Marwick, who chaired the local committee to nominate arts organizations and raise funds.
"One of the things . . . you look at is whether the organization is truly autonomous," he said. That disqualified such organizations as the Mechanic Theater, because of its connection with the city, and the Peabody Institute, which is part of the Johns Hopkins University. A group such as the Theatre Project is too small.
On financial brink
NASF beneficiaries elsewhere give the organization high praise.
"Two years ago they came to take the phones out of our walls," said Michael Kaiser, executive director of the Alvin Ailey American Dance Theater, which has headquarters in New York and is also active in Baltimore and Kansas City. At that time, the company had a debt of $1.2 million.
Today, the debt is gone and the organization is on sound financial footing after receiving a $1 million NASF grant last year, Mr. Kaiser said.
The three Baltimore grants to be announced today are a step in a 10-year process that the NASF goes through at each site.
Sita Culman, the vice president of the 40-year-old Baltimore-based Abell Foundation and wife of the Center Stage director, started that process in 1987 when she initiated contact with the NASF.
She was inspired by the group's success in other cities and by its continuation of work begun by the Ford Foundation in the 1970s.
Local committee established
After the Abell Foundation expressed willingness to contribute significantly, an 11-member committee of local business and foundation leaders was formed to nominate arts organizations and raise funds.
Mr. Langmead of KPMG Peat Marwick chaired the committee, which includes Edwin A. Daniels of the Rouse Co. Foundation, Timothy D. Armbruster of the Baltimore Community Foundation, and George L. Bunting Jr. of the Noxell Foundation and the Abell Foundation.
The NASF and the local committee agreed on the $6 million total. And, according to NASF rules, 85 percent of the local money must be in place before it will sign an agreement with the local committee to go forward. In Baltimore, 90 percent was raised by 1991 and $3.8 million has been raised to date.
Next came the long nomination procedure.
The NASF sends personnel to work with each nominee on financial reporting and long-range planning. Financial reporting is put on a balance sheet basis similar to that used by successful businesses, to make predicting for the future clearer and more accurate; long-range artistic plans must be integrated with long-range financial plans.
The overall project, said Stephen Seymour, of Rockland Investments and a member of the local committee, is "an insurance policy [for] the Baltimore community -- [insuring] that the major arts institutions [are] doing the necessary financial and long-range strategic planning to allow them to go into the 21st century."