Saturday, January 10, 2009

Deaccessioning Wars: To Be or Not To Be...

Although there's been quite a bit of sparring in the deaccessioning colosseum lately, we've lagged behind a bit. Here's our attempt at playing catch-up.

The most recent action on the subject is revolving around the New York's National Academy Museum's decision to deaccession two paintings from its collection for $15 million in order to continue with its general operations. Quite a few voices have risen in response to the Academy's decision, with most attacking the Academy's decision to deaccession. The main maginot line of defense comes from The Art Law Blog's Donn Zaretsky, and to some extent from the Time's Richard Lacayo, UCLA's Mark Kleiman, and portfolio.com's Felix Salmon. The attacks against deaccessioning-as-fundraising come primarily from Tyler Green (the power of his comments, however, are unfortunately tainted by some childish comments and personal attacks) and CultureGrrl's Lee Rosenbaum.

The New York Times had a lengthy article on this mess this past December, and NPR threw in its two pesos here.

For solid pro-deaccessioning reasons, a must-read is Donn's Art Law Blog. In fact, the Art Market Monitor applauds Zaretsky's position, giving Zaretsky an easy 10-run lead with two outs in the bottom of the ninth (and with Carlos Beltran batting!):

Donn Zaretsky, author of the ArtLawBlog, is the unsung hero of the deaccessioning wars–the ongoing debate launched by the National Academy’s sale of two paintings recently. Zaretsky is consistently the most interesting voice in this debate because he applies unrelenting logic to a lot of emotional positions.

In all honesty, we've been converted to Donn's side ("DZ position"), but we would like to try and reconcile it (somewhat) with Tyler Green's position (sans personal attacks). A few thoughts are in order that surprisingly (at least to our understanding) have been, to this date, omitted.

1. Sanctity of Art Museums & Institutions: Tyler Green makes a valid argument regarding the necessary self-destruction and demise of an art institution if it fails to establish, adhere to and enforce its own rules, regulations and budgets. In brief, what I question here is the sanctity of art museums and art institutions. What makes them so valuable and precious that they should be immune from dissolution or bankruptcy proceedings? From a strictly artistic perspective, I wonder why art and its institutions should be privileged over other institutions, be they for-profit or non-profit. Why should donors or the tax-paying public be responsible for the maintenance and upkeep of an institution that for some reason has failed to exist on its own two feet? If this sounds like a non-profit version of a bailout, it probably is. Is there anything (really) wrong with allowing a tax-exempt art institution to close, and thus channeling its assets (ex: artworks) to other 501(c)(3) institutions or to the state under which it is incorporated. Are we really saying that access to a Pollock, Miro or Warhol is more valuable than production of Hummers or Chrysler LeBarons? I really don't think so, and I don't really see why a donor or the general public should have to allow for one or two deaccessions simply to allow an already failing and flailing institution to survive and thus continue to waste more private and public monies. In a nutshell, I would rather experience a Warhol in Iowa than in a mismanaged Los Angeles museum, whatever the cost to the California public (see #4 below).

2. Fiduciary and Legal Duties: Reason #1 leads to Reason #2. Nonprofit corporations are not privately owned, rather they are public entities controlled by a board of directors. These board members have fiduciary and legal duties to act in the best interest of the art institution. If the the board fails to live up to its fiduciary and legal duties , I believe the correct result should be that this institution is penalized, dissolved, or have its tax-exempt status revoked. I have indentified at least three tests (which i refer to as the three policing variables) to police and measure the board and the nonprofit institution's perfomance and "right" to continue as originally constituted--as a publically subsidied, tax-exempt organization.

When the fiduciary and legal duties are not met (see LA MoCA), there should (in a perfect world) be at least three policing variables which should (a) penalize the institution for its malfeasence, (b) initiate legal action against the board of directors, (c) revoke that institution's tax-exempt status, and/or (d) cease to provide that institution with donations, gifts, in-kind donations, or grants. The three policing variables are: (1) governmental (state and federal); (2) board of directors; (3) the general public.

In effect, any of the four "penalties" placed on the institution would be warranted, primarily because any board in charge of a million-dollar budget should be well-advised of any and all legal and ethical repercussions should it breach any of its fiduciary or legal duties. Selling a Warhol or Pollock would make sense if there was no foreseeable business risk, but tanking millions of dollars in a seemingly ignorant and careless manner does not warrant the deaccessioning of art for the sake of keeping a life-line on a dying institution. (Note: This is also called the band-aid on a bullet-hole theory.)

3. Conditions & Restrictions: So as to not seem heartless, there could be a "one-time exception" to Rules #1 and #2 above, so long as certain strict conditions and restrictions are met as a pre-condition. These could range from public disclosure on a bi-monthly basis of all insitutional expenditures, to a complete firing and replacement of that institution's board of directors. The revamping of that institution's staff, employees and volunteers would also be a welcome condition (with salaries and benefits comensurate with that institution's financial ability to meet them), as well as restrictions on the amount of money that could be spent by the museum on art installations, shipping & handling, insurance, as well as artist and guest lecturer honorariums and stipends. Of course, these restrictions and conditions could be limited to a number of years, so long as the museum passes muster each and every year with flying colors!

4. Public Oversight: Nonprofit tax-exempt institutions have a duty to disclose their certificates of incorporation, by-laws, tax-exempt ruling, and tax forms to the public. There's no reason why the general public should not take obtain this information and educate itself on the operations of a failing institution. This would facilitate notification by the general public of any perceived wrongdoing by the institution to the state attorney general, the charities bureau, as well as the IRS. The "right" of the citizenry to view and experience a Warhol, Miro or Pollock is not without a certain duty to review and inspect a nonprofit tax-exempt art institution's internal operations. Make the public responsible for its museums and institutions and I can gurantee that the board of directors will pay a bit more attention to its operations and decisions.


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1 comment:

richard said...

Firstly The National Academy Museum did not sell any paintings. These paintings were given to the National Academy of Design in 1865. There no tax exempt organizations at that time. It was the Academy members who had to vote to sell the paintings and they did so 181 to 1.
Artists realize a work of art has a life of its own. Artwork finds its place. The Metropolitan Museum was founded in 1870. It now has millions of works of art from all over the world. Without the life and movement of art American museum would be largely empty.