Are They Museums - Or Businesses?

MUSEUMS seem to do everything for visitors these days except give them a bed for the night. They provide parking, food, and opportunities for singles to meet. They offer a myriad of gift ideas, arrange vacations (domestic and foreign), and host parties in the galleries. Entrepreneurship is alive and well at America's museums. The Metropolitan Museum of Art in New York City, for instance, earns 9 percent of its income from what are called "auxiliary services," that is, activities that are not specifically

related to the purpose of the institution.

Everyone notices what is going on. Critics complain that the efforts made to market museums to the widest possible audience dilute, or perhaps interfere with, the educational objectives of the institutions, while many people like the opportunity to buy exhibit posters and get a bit to eat without leaving the building. Still others contend that the search for new sources of revenue provides only minor distractions, and these are simply ways of keeping the museums open and available to the public.

Whatever one's feelings about these developments, the restaurants, mail order catalogues and other offerings are but symptoms of a larger problem: Where is the money to come from in order to run these institutions?

The problem has become increasingly acute as museums have seen declining financial assistance from foundations since the late 1970s, the federal government since 1980, corporations since the mid-1980s and state governments since 1989. Changes in the federal tax code have also decreased incentives for charitable giving by private individuals.

Museums have also found themselves boxed in by strong guidelines established last year by the American Association of Museums in Washington. These prohibit member institutions from using any money raised through deaccessioning works in their collections - renting them out - for any other use than making new acquisitions. The association threatens to withhold or withdraw accreditation to museums that don't comply.

There are valid reasons for the association's stand. Museums are public trusts whose collections should not be seen as quick cash for bonuses, perks, and other relatively frivolous activities.

Using a collection as a regular source of money also detracts from the more legitimate need on the part of the museum's directors and trustees to develop an adequate fund-raising strategy. However, many smaller institutions, such as historic houses and less well-endowed museums, have found this regulation onerous. For these museums, there are often more objects than money to properly care for them. Insuring collections and providing up-to-date security measures - not to mention salaries, heat, light and power, and sundry other vital expenses - are all more expensive. All of these costs are rising at a time when traditional sources of revenue are offering less.

The result is that museums have skewed their operations and practices in the search for money. Among the more recent examples is the Boston Museum of Fine Arts, which rented - or, as the museum prefers, made a "loan" of - more than 60 of its finest Impressionist paintings to a Japanese electronics company in exchange for about $2 million in cash. The New York Historical Society is using part of its collection (150 items, appraised at $3 million) as collateral for a $1.5 million loan from Sotheby's, the a uction house. Such foolish short-term solutions open the door to greater folly but, at least, accreditation isn't jeopardized.

There is a need to reevaluate the deaccessioning rule in the light of each institution's particular problems. Most museums deaccession objects that are never on display, stored in the basement but still requiring ongoing maintenance and periodic conservation. In fact, the overwhelming majority of most museums' collections are in storage and never on view to the public.

Who is served by a rule requiring a museum to only use the money it raises from selling an object it never displays to buy something it hasn't the exhibition space to show or the funds to take care of properly? Why is the possibility that art and other objects may be purchased by private collectors so loathsome to the American Association of Museums that it created a rule that makes deaccessioning so onerous to museums in need?

Inflexibility, however, is not solely the domain of the museum association. Governments on the local, state, and federal levels have been cracking down on what it calls "unrelated business income" by nonprofit institutions, such as museums. Those gallery rentals for corporate parties, book stores, restaurants, and other fund-raising efforts compete with convention halls, book stores, and restaurants outside the institution's walls (which do not enjoy tax-exempt status), providing governmental agencies wi th ammunition to claim the right to collect taxes.

Tennessee currently has an "entertainment tax," which museums are required to collect in lieu of a sales tax, on admissions. Many other educational institutions - such as the San Diego Zoo and Yale University - have been hit by their local governments with a "head tax" that does much the same thing.

One is likely to see more rather than fewer instances of peculiar museum fund-raising methods in the style of the Boston Museum of Fine Arts and the New York Historical Society.

Renting artworks for ready money, or going to Sotheby's the way one might go to a pawnbroker, are troubling solutions to money shortages. But what is most disturbing is that these approaches fit within - and, in fact, are a response to - the museum association's guidelines on the one hand and governmental miserliness toward museums on the other. In this context, they make perfect sense.

It is only from the viewpoint of the public - which, in the case of the Boston Museum of Fine Arts, is denied access to the valued art for a period of time and, as with the New-York Historical Society, may never see part of the collection - that the solutions make no sense.

There is a need for everyone who cares about museums to think harder about what problems these institutions face and how they must face them.