BALTIMORE, MD.- The Baltimore Museum of Art
today announced the implementation of short- and long-term measures designed to balance the Museums budget for the coming years and ensure the institutions financial health. Initiatives include a reduction in personnel, restructuring staff in key areas, increasing contributed and earned revenue, and reducing the draw on the Museums endowment. Taken together, these steps will lead to a stronger and more financially sustainable Museum to serve visitors from Baltimore, Maryland, and around the world.
The gap between expenses and revenues in the BMAs operating budget is largely the result of the lingering impact of the economic downturn. During the past five years, the BMA has seen government grants for operating support decrease by 43%, from $3 million in fiscal year 2009 to nearly $1.7 million in fiscal year 2014, a decrease of $1.3 million. The fiscal year 2013 operating budget is $12.9 million.
The staff restructuring includes the addition of four new positions in strategic areas that will build the Museums capacity in technology, earned revenue, volunteer support, and fundraising. It also eliminates five open unfilled positions, as well as 11 full-time and three part-time positions from a staff of 154. This will reduce the Museums personnel expenses annually by more than $500,000. Cost-cutting measures taken by the BMA in 2009 and 2010 included scaling back exhibitions and programs, reducing marketing expenses, and implementing temporary salary reductions.
For the past five years, we have managed to reduce expenses in every other area of the Museum. Now, in order to sustain the Museum for the future, we must reduce personnel costs. Like many other museums, we could no longer avoid this difficult and painful decision, said BMA Director Doreen Bolger. It is our responsibility to realign staff resources to the current fiscal realities while continuing to serve this community and fulfill our mission.
Other sustainability initiatives include expanding the BMAs facility rental program to increase earned revenue and reducing the draw on the Museums endowment, which had been temporarily increased to 5.5% during the past seven years. From December 2007 through February 2009, the value of the BMAs endowment decreased 39%, and the impact of this reduction has not been fully recovered. Partially as a result of contributions to In a New Light: The Campaign for The Baltimore Museum of Art, the current value of the endowment is $81.3 million, with $71.5 million eligible for the operating budget. The draw on the endowment is anticipated to be 5.25% in fiscal year 2014 if approved by the Board of Trustees in May.
As a Board and staff, we are committed to this great institution and to ensuring its future for our members, patrons and the community at large through the adoption of a sustainable business model for the 21stcentury. Our management team is taking difficult, but necessary steps to ensure the Museums financial stability so that the citizens of Baltimore and the State of Maryland can continue to enjoy and benefit from this wonderful cultural resource, said Frederick Singley Koontz, Chairman of the BMAs Board of Trustees.
The Board of Trustees approved the budget reductions that will affect areas across the Museum, while minimizing the impact on the BMAs public services and ensuring it remains a vibrant, vital, and fully programmed museum. General admission to the BMA will continue to be free.
Since the 2007 launch of the In a New Light fundraising campaign, the BMA has raised $68.6 million for the endowment and capital renovations. The Museums $24.5 million renovation is in the Museums capital budget and will continue despite this reduction to the annual operating budget. The Museum has currently raised $20 million toward the renovation, including $10 million in capital funding from the State of Maryland and another $2.95 million committed from the City of Baltimore. The Museum is continuing to raise funds for the endowment and renovation, as well as the annual operating budget.