[intro]Koons’s Train Waiting for Donor Support Too[/intro]
The $254.7-million pile of cash and investments shrank to $196 million, a 23% drop, according to figures in the audited financial statements that LACMA recently posted on its website.
The most worrisome development for LACMA — as for many nonprofits — has been the recession’s effect on fundraising. In 2007-08, it raked in gifts and pledges totaling $129.7 million, most of it for the museum’s expansion and renovation campaign, which was in high gear amid strong markets. In 2008-09, donations fell to $29 million. The capital campaign stands at $316 million — $134 million shy of its $450-million goal.
The portion of its holdings that the museum sets aside as an endowment shrank from $148 million to $99.6 million, a 32.7% decline. (That includes a $7.3-million reduction that was not due to investment losses but was withdrawn to pay operating expenses, in keeping with the museum’s policy of annually spending about 5% of the endowment’s value.)
With the markets brightening lately, the endowment had grown to $109 million on Sept. 30, said Ann Rowland, LACMA’s chief financial officer.
Bloomberg’s Katya Kazakina illustrates the effects of the endowment fall (see updated below) by pointing out the Jeff Koons train installation–designed to hang ominously over the museum’s entrance–is being put on hold until a donor can be found to support the $25 million work’s cost:
Scheduled to arrive at the Los Angeles County Museum of Art in 2011-2012, the “Train” project got pushed to 2014-2015 when the stock market plunged last year, erasing 23 percent of Lacma’s endowment and forcing it to rethink budget priorities, the museum said. It could be canceled altogether if the museum doesn’t come up with necessary funding.
“We wouldn’t do it unless someone funds it; someone has to write us a check,” said Barbara Pflaumer, Lacma’s associate vice president for communications and marketing. “This is a very tough economy. Everyone has revised timetables.”
Update: Barbara Pflaumer from LACMA called today to clarify the Bloomberg report. The Koons train was always meant to be funded by patrons. The recession has made it difficult to find one or more supporters willing to foot the bill. But the delay, according to Pflaumer, is unconnected to the change in the endowment.