The National Endowment: preparing for the future.

During the past twenty-seven years, I have been responsible for the financial strength of six arts organizations and the raising of more than $100 million for them. My career in fund-raising for the most part occurred during "the good times." In this period, the National Endowment for the Arts, first funded by Congress in 1966, has made available grants amounting to $3,188,533,618. I either assisted or provided community leadership on such projects as reorganizing Cincinnati Ballet; saving the Ocean State Theater in Providence, Rhode Island; turning around a financially faltering Joffrey Ballet in the late 1970s; reigniting Pennsylvania Ballet in late 1981 after a major layoff of the company; raising more than $44 million in Minneapolis for the Guthrie Theatre in the late 1980s and early 1990s; and, since November 1995, conceiving and directing an artistic mission and long-range plan for the DanceAspen Summer Festival.

Now, while considering my response to Dance Magazine's question, "What will happen to dance if the NEA were simply to go away?," I have begun to feel that I may have come from a different civilization -- perhaps a bygone era -- when the problems and prospects for the performing arts were the subject of thoughtful dinner conversations, informative books, and constructive public debate.

A LOOK BACK

In 1953, when I first saw New York City Ballet, my middle school, St. Bernard's in New York City, provided a comfortable, safe, productive, ambitious environment for my interest in music. I sang in Gilbert and Sullivan operettas. We had a choir and a recorder ensemble doing Elizabethan songs. To graduate from eighth grade, you had to perform in a Shakespeare play. There were also ballroom dance classes and the study of Latin. And there was a complete consensus: a respect for the law, truthfulness, tradition, civility, and virtue; and a curiosity for the wisdom of centuries past. Reasoned discourse was the means for addressing opposing views.

In those days only New York City and San Francisco could be described as having established resident dance companies. (I am omitting short-lived groups from the mid-thirties onward, like Philadelphia Ballet.) By the time I had graduated from high school in 1964, paid attendance for professional dance performances was estimated at about one million -- 70 percent of it from residents of the greater metropolitan area of New York City. Today the total paid attendance is estimated to be in excess of twelve million, and 75 percent of this audience resides outside the New York City area. In the United States, there are now more than forty dance companies with operating budgets that are greater than $2 million.

THE TURNING POINT

There is little disagreement among arts professionals that the decentralization of dance happened during the 1970s, thanks to funding provided by NEA's National Dance Touring Program. The number of professional dancers leaving New York City for nationwide tours grew incrementally every year, and by the 1980s regional dance was in the ascendancy. Dancers also began leaving New York City to set up companies from Ram Island, Maine, to San Diego, California. The arts moved from the periphery of our lives to where they belong -- where, in fact, they always were before the Industrial Revolution: at the heart of civilization, imparting meaning, quality, and pleasure to shared experiences. No matter where we travel, we can all see the impact NEA dollars have made.

The impact that dance and other performing arts can have on a community is also considerable. Here in Aspen, a 1996 University of Colorado economic impact study found that the arts brought more than $59 million a year to our valley's local economy and created 93 full-time and 174 part-time jobs.

Increased -- or at least sustained -- federal support through NEA would appear to make good business sense for a community. The faction opposed to public support for the arts has been effective, however, far out of proportion to its numbers. (Since the NEA was founded, only 40 of its 112,000 grants have been controversial; people who say they don't want "their tax dollar" spent on such frills should be told their individual contribution is now closer to thirty-two cents.) Last year Congress slashed $69 million in NEA funding -- a cut that came after a sixteen-year period when federal support was barely increased while exposed to the erosion of inflation.

Not to worry, Congress says; other funders will take up the slack. However, among the informed, who know that the number of nonprofit organizations has grown by more than 900,000 since 1980, there is considerable doubt that private philanthropy can even begin to meet the soaring need for support. If you redesign an airplane without regard for the principles of aerodynamics, the plane is going to crash because such principles are unforgiving. Congress seems to have forgotten that there are also principles governing institutions and society that should be remembered if we are to avoid similar catastrophes.

FACING THE FUTURE

I believe that there are now core questions to be answered by all arts administrators, presenters, funders, and audience members in light of the probable collapse or drastic reduction in federal funding. I say "probable" not merely in relation to fiscal 1998 but because, over time, the will to fight the political opposition could wane, and in the not-too-distant future there may not be sufficient public support to maintain pressure on Congress.

Considering a collapse of federal funding, we should begin learning from other financial upheavals and crises: the deregulation of the savings and loan and airline industries, the Great Depression, and the auto industry's retooling for competition from Japan. The point is that since the 1980s we have been redesigning corporate America with breathtaking speed and changing the functions of government; as a result, the support systems for nonprofit institutions are gradually being dismantled.

If the NEA were destroyed, I believe there would be an immediate thinning in the ranks of those dance companies with no cash reserves or endowments. Soon there would follow a slow strangulation of those companies where management's institutional strength is insufficient to survive the changes caused by the loss of millions of dollars in grants during one year. All arts organizations -- not just dance companies -- would face the same crisis at once. No arts manager or board of trustees has any training for or experience in dealing with such an upheaval.

THE SPECIAL POSITION OF DANCE

Dance, which enjoys the youngest audiences of all the performing arts, would be particularly vulnerable in this situation. Because most professional dance companies outside of New York City and San Francisco are of fairly recent origin, few have amassed the sizable endowments of symphony orchestras, opera companies, theater groups, and museums. For example, the Minnesota Orchestra, which is not ranked among the top five U.S. orchestras, has an endowment of more than $70 million. The Pittsburgh Symphony currently has $70 million and is raising another $70 million. The Metropolitan Opera is well known for its Centennial Fund completion in the mid-1980s, which generated some $100 million for a permanent endowment.

This endowment gap between dance and other art forms was highlighted as early as the mid-1970s in the Ford Foundation studies of their cash reserve grantees, which demonstrated that each art form's base audience has a different median age. Opera attracts the oldest audience, and modern dance the youngest.

What national funders failed to observe was that the average contribution is variable as well. Young people have not reached their peak earning years, and older audiences are concerned with retirement, estate planning, and asset redistribution.

With the exception of New York City's School of American Ballet, with more than $43 million in managed investments, only three ballet institutions in the United States have endowments greater than $20 million, and very few companies have endowments that can prudently produce annual income in excess of $50,000. Given that the United States has at least forty preeminent dance companies, this lack of national vision for dance points to a critical need to stabilize long-term funding and increase short-term earned income. Unfortunately, dance will get its term when all arts organizations will be reeling from the potential loss of millions in NEA funding.

WHAT TO DO NOW

If the NEA must die for political reasons, the question of what dance and other nonprofits can do to help their future remains. The first thing we should do is to ask Congress to help us help ourselves: Change the tax law to allow taxpayers to deduct their charitable contributions. Currently, if you do not file a long form (IRS 1040), you cannot deduct charitable contributions. Since we know that the national dance audience is younger than the audiences for other art forms and thus earns less than older taxpayers, one quickly concludes that many small donors are at a distinct financial disadvantage. Our interest is always to attract small donors to our organizations, and over a lifetime to cultivate those who are in a position to make major gifts.

This past year the Parsons Dance Company made its third consecutive annual engagement at the DanceAspen Summer Festival. The company completed its tenth anniversary just as the Senate took up the debate of either accepting President Clinton's recommendation for a $35 million increase or affirming the House's call for the elimination of the final $100 million of NEA support. I believe that dance historians will be particularly impressed by the fact that Parsons created this company during the decade of heated public debate over federal support for the arts. I also believe that if the NEA had ended in 1986, when the public debate for federal support heated up, the Parsons Dance Company would not exist today.

We at Danceaspen, anticipating the need for change back in November 1995, began to alter our method of presenting to give at least some companies, such as the Parsons, a sense of stability. We selected those of contemporary and historical consequence, doubled their performance fees, and guaranteed each several summers' work. We have agreed to bring the Martha Graham Dance Company back to Aspen for the next three summers, and the Paul Taylor Dance Company will be back in 1998 for its third summer. Miami City Ballet is enjoying an every-other-summer engagement. Plans now call for the establishment of a winter season for 1999 as well -- with or without the NEA.

Make no mistake, NEA funding is not just a matter of who pays for art or what is performed. It is also about what resources our children and their children will have when they seek to know the great ideas of humankind. Where will they find an unpretentious sense of self-worth and a hierarchy of values that will support them during the reversals of life? Where will young people find positive inspiration and imagination?

WHAT PRIVATE DONORS WILL LOOK FOR

Whether or not the NEA continues to fade, dance companies must do more to attract support from private donors and foundations. To make themselves look worthy of private funding, experience has taught me that artistic directors and choreographers should be considering such questions as the following:

* Is my company staffed with experienced managers and gifted performers?

* Has it earned the confidence and respect of my community and my peers?

* Does it occupy a special niche in the community and in the profession?

* Has it established efficient fund-raising procedures?

* Is it attempting to build up adequate endowment and financial reserves?

* Has it planned at least five years ahead?

Answering no to even one of the above could jeopardize your chances at private and foundation support.