In February 1991, the Cincinnati Institute of Fine Arts (CIFA) established an Arts Funding Review Committee to examine the financial status of the community's major arts organizations and recommend a program of private and/or public financing to meet their needs during the 1990s. Establishment of the Committee was in response to concern about mounting financial problems at a number of art institutions. The Committee's work parallels a similar study made in 1985. The Committee established a number of task forces to examine each of the eight Fine Arts Fund organizations, the Institute and other issues as well.

The Committee found that, with a few exceptions, these organizations are in one kind of financial trouble or another, with combined deficits in 1991 of nearly $3 million. The major reason for these problems is the fact that the organization's costs increased by 23% during a period in which revenues increased at about half this rate. In order to correct this and help assure financially responsible organizations in the future, the Committee made a number of recommendations relating to both fiscal discipline and fund raising.

To help assure control over costs, the Committee recommends: Strong and active leadership by the voluntary boards of the major arts organizations to avoid an accumulation of financial problems similar to those developed in the past. Major additions to the responsibilities of the CIFA. The recommendations would give the Institute a new oversight role for assuring the financial integrity of its member organizations without interfering with their artistic independence. The recommendations would also add another dimension to the allocation process and have the Institute regularly and routinely monitor the financial status of its member organizations.

The quick development by the organizations as a group of a strategic plan for long-term cooperation and collaboration. Substantial cost-saving opportunities exist from cooperative and collaborative efforts in procurement, marketing and administration among the organizations, but these opportunities are unlikely to be realized without direction from the organizations' boards of trustees and incentives from CIFA. Besides the need to assure a firm control over costs, the Committee found a need for a higher level of financial support for the organizations. To provide this, the Committee recommends: That the Fine Arts Fund remain the community's major focus for arts fund raising and that a program to increase the base level of support for the FAF by $2 million beginning with the 1993 campaign be implemented.

The program calls for increased corporate support, much bigger employee campaigns and more and larger individual gifts. Additionally, the Committee found: While most major Cincinnati businesses are responsible supporters of local arts and cultural organizations, their good efforts disguise the facts that many do little to support the arts today and that extra efforts will be needed in the future to keep the arts in Cincinnati viable.

Visits to seven comparable cities indicate that most are actually dissimilar to Cincinnati because of the extensive participation in fine arts funding by major foundations or substantial public support. Of the cities visited, only Milwaukee raises more money from sources similar to those available to Cincinnati institutions. The smaller arts organizations are important to the cultural life of the community and appear to be experiencing financial difficulties similar to those of the larger groups.

A detailed study to develop solutions is proposed. Pressures on political institutions for additional funding of essential services means that little if any additional tax support can be expected without going directly to the voters with a levy proposal. While the Committee does not believe this should be done at this time, if it is tried in the future the Committee believes it would have to be preceded by a substantial public education effort to be successful.

Cincinnati ranks high in studies that determine communities' quality of life. The major arts organizations are a critical factor in this and are among the most important reasons for attracting businesses and professional people to the area. The organizations have a substantial economic impact on the area as well. This impact was about $102 million in 1990, placing the eight institutions just behind the Cincinnati Reds and ahead of the Bengals, the Zoo and the ATP Championship matches in this respect. The Committee believes that implementation of its recommendations will lessen the threat to Cincinnati's cultural heritage and will secure a stronger financial base for the city's arts institutions. Urgent steps are needed to safeguard this priceless community resource, and action must be taken now.

CONTENTS
Executive Summary.

     I. Introduction.
    II. Sources of financial support.
   III. Economic and cultural impact of Fine Arts organizations.  
  IV. Current status of fine arts fund organizations. 
   V. Impact of escalating cost is key issue. 
  VI. Funding methods of similar cultural institutions in Comparable cities.
 VII. Additional studies.
VIII. Conclusions and recommendations.
  IX. Appendices.

Review of business operations.
Operating results of fine arts fund organizations.

In February 1991, the Cincinnati Institute of Fine Arts (CIFA) established an Arts Funding Review Committee to examine the financial status of the community's major arts organizations and recommend a program of private and/or public financing to meet their needs during the 1990s. Establishment of the Committee was in response to concern about mounting financial problems at a number of art institutions. The Committee's work parallels a similar study made in 1985. The Committee established a number of task forces to examine each of the eight Fine Arts Fund organizations, the Institute and other issues as well.