The great Barnes shell game

When you're in a hole, stop digging, or:
The great Barnes shell game

ROBERT ZALLER

The plan presented to the Orphans Court of Montgomery County in September 2004 and subsequently approved by Judge Stanley R. Ott called for the Barnes Foundation to be restructured on a three-campus model: The permanent gallery collection would be moved to a new site on the Ben Franklin Parkway; the Merion mansion in which it is currently housed would be used as an administrative center and for the display of artifacts and memorabilia; and the 137-acre farm estate of Ker Feal in Chester County would be developed into a visitors’ center for the display of the Barnes’ collection of 18th-century art and artifacts. The Barnes Foundation’s five-person board of trustees was authorized to add ten new members.

The estimated cost of these changes and renovations, not all of them accounted for in the plan, was $150 million, including a $50 million endowment that, it was hoped, would throw off $2.5 million per year in revenue. Despite this calculation, and despite a goal of 200,000 visitors per year for the new downtown facility, an annual shortfall of $4.5 million was projected on an estimated budget of $12 million per year. This was nearly twice the amount of the operating deficit of $2.5 million claimed by the petitioners, and four times the size of the actual deficit ($1.0 to 1.2 million) disclosed by audit.

So let’s have that slow and easy: To “solve” a deficit problem of $2.5 million (or less than half that, in reality), you create a permanent, continuing deficit of $4.5 million, with no plan beyond a hazy goal of “fund-raising”—after exhausting the $150 million you’ve already raised for starters—to meet it? That would seem to violate a few principles of business management and accounting, starting with a very fundamental one: When you’re in a hole, stop digging.

Weak assumptions about attendance

It gets better, though. The Barnes trustees presented no studies or other evidence to indicate they could meet their goal of 200,000 visitors per year, even by the expedient of opening the projected downtown facility to the public ten hours a day, seven days a week. The institutions most comparable to the Barnes— the Rodin Museum and the Pennsylvania Academy of Fine Arts— average 60,000 to 65,000 visitors, or about the current attendance ceiling on the Barnes (62,400). Even assuming that the Barnes would prove a significantly better draw than either of these other institutions, what makes 200,000 a more realistic figure than, say, 100,000? And what led the trustees to assume, contrary to the evidence of all comparable institutions (i.e., private, specialized, and without rotating exhibits), that the figure of the first year or two could be sustained over a long period of time, once the novelty of the move had worn off? Once again, no evidence or analysis was presented: as far as one could tell, the number had simply been plucked out of a hat.

A further unexamined assumption of the trustees’ petition is worth considering. The grand scheme of which the new Barnes is supposedly a part envisions a so-called Museum Mile, anchored by the Philadelphia Museum of Art, which will draw tourists in sufficient numbers to improve attendance at all the institutions along the way. But is it true that tourists visiting the Barnes will also visit the Art Museum, and vice versa? Why may one not assume rather that such visitors, or a significant proportion of them, will choose one instead of the other, given finite time, resources and, perhaps, interest in art? In that equally plausible case, the Art Museum and the Barnes would not be net gainers from each other’s proximity (even if tourist numbers as a whole were higher), but net losers.

What if the Barnes not only failed to make a go of it on the Parkway, but dragged down the Art Museum, whose attendance revenues already lag? What if you simply generated two bankruptcies for the price of one?

What does Gerry Lenfest know?

If I were the chairman of the Art Museum’s trustees, I would worry very much about the potential negative effect of having a trove of Renoirs, Matisses, and Cézannes in a rival institution a few blocks away that kept Christmas shopping hours 365 days a year. But Gerry Lenfest, who does chair the Art Museum’s board, seems not to be worried at all. In fact, his Lenfest Foundation is, with the Pew Charitable Trusts and the Annenberg Foundation, one of the three principal supporters of the Barnes move. Does Gerry know something that the rest of us don’t?

I’m betting that he does. I’m betting there’s a reason he is unfazed by the slow pace of the Barnes fund-raising, or by the failure to hire a project architect, to appoint a new director to succeed the departed Kimberly Camp, or even to fill out the Barnes’s expanded board of trustees. I’m betting there’s no frown on his brow now that the projected costs of building the new Barnes facility have risen to $200 million and more, and increase with each day’s delay. And I’m betting there’s a reason why the three sisters of our play— Anne d’Harnoncourt of the Art Museum, Rebecca Rimel of the Pew Charitable Trusts, and Leonore Annenberg of the Annenberg Foundation— are equally unconcerned.

The Art Museum’s stake

That reason is simply this: There is not, and has never been, any serious intention to build a new, independent facility for the Barnes Foundation in downtown Philadelphia; the three-campus model was a plan devised not to rescue the Barnes from bankruptcy but, as all the numbers indicate, to deepen and perpetuate it; and the Barnes’s fund-raising campaign itself is a shell game created to mask the real intent of the players: to capture the permanent gallery collection for the Art Museum itself.

The scenario might play out like this: While plans for construction on the Parkway languish, costs escalate, and the artificially sustained deficit at Merion drags on, the Barnes trustees (to whom Judge Ott has already extended an open-ended invitation) return to court to apply for permission to generate revenues by bringing the “best” of the permanent collection back, as during their 1995 world tour, for exhibit at the Art Museum, to remain until such time as the new facility is ready for operation. Once the collection is downtown, some civic booster suggests that it would be cheaper and far more efficient if it were housed permanently in the Art Museum, or in the new Perelman Building, or in a special wing. That way (it will be discovered) tourists will not have to go to two separate destinations to see both the Art Museum and the Barnes; and the wonderful real estate possibilities opened up by the demolition of the Youth Study Center, where the Barnes was to have been built, can be dedicated to other and more commercially lucrative purposes—say, a high-end shopping center, or another Barnes Tower apartment complex.

A dividend for Annenberg, too

It’s the perfect solution: Leonore Annenberg makes amends for her husband’s bequest of his own collection to the Metropolitan Museum of Art by securing an even richer haul for the Art Museum; the Art Museum gets physical, and in time perhaps legal possession of the finest collection of post-Impressionist and early modern art in the world, along with a share and eventually the whole of the revenues it generates; Philadelphia glows with its new trophy; developers salivate; politicians beam; donors get to keep their cash. What could be a happier ending?

All that would be lost would be (a) the integrity of the collection, wrenched from the jewel for which it was designed; (b) the Barnes art program, which depends crucially on that setting; and, of course, (c) the will and intent of that dead white male, Albert C. Barnes himself.

A small price to pay for the greater good, wouldn’t you say? Or, if you wouldn’t, rest assured that others will.

I can’t prove that this state of affairs is what the move’s promoters have in mind. But it would be very strange if these smart and worldly-wise people hadn’t considered such a scenario, as a fallback position if not the primary one. I see no other credible explanation for the reckless, irresponsible, and wholly unsupported plan they presented in court, one that Judge Ott felt obliged to distance himself from even as he gave it his imprimatur.

The failure to appoint a new Barnes director

I don't see, either, any other good explanation for the failure to appoint a new director for the Barnes in a year, to fill out its board, and to select an architect for the Youth Study Center site. These steps may be taken—calling the promoters' bluff may actually hasten them—but the longer the project can be delayed and the more its costs climb, the more attractive and ultimately inevitable it will seem to turn to the Art Museum as the only existing facility that can "rescue" the Barnes from its supposed financial straits and give it a final Philadelphia home.

People who have never experienced the Barnes in Merion, or who have been frustrated by the obstacles set up to seeing it by the current Barnes management, may shrug off my objections: If the collection winds up more accessible and more centrally located, why quibble about the means employed to bring about a worthy end?

To such people I can only say: Take the trouble to see the Barnes in situ and to acquaint yourself with its extraordinary history, and--if you have the slightest aesthetic or cultural sensitivity--you will understand why the collection is no more to be moved from the place lovingly designed for it than, say, Giotto's frescoes should be moved from Assisi or Jefferson's writing desk from Monticello.

The Pew Trusts' code of ethics

But there is another and more practical reason to look askance at the shenanigans of Pew, Annenberg, Lenfest et al. That is the vexed question of donor intent, with all it implies for charitable bequests, philanthropic giving and property rights in general. Albert C. Barnes was as specific as he could be in setting up the Indenture of Trust for the Barnes Foundation (Article V): "It is . . . stipulated that the identity of the Donee as an educational institution is to be preserved for all time and Donee is not to be merged in or absorbed by any other institution" (Italics mine). Article X stipulates that Article V is "unamendable and shall never be amended in any manner whatsoever."

Now, look at the Pew Charitable Trusts' own Code of Ethics, which states that "Any conflict of interest or the appearance thereof are avoided or appropriately managed through disclosure, recusal or other means pursuant to PCT's bylaws and board conflict of interest policy." It also states that, with regard to donor intent, the Pew works "to ensure that all spending practices are fair, reasonable and appropriate"; that "financial reports are accurate and complete in all respects" and are annually audited by independent and certified public accounting firms; that all donor funds are "expended . . . consistent with donor intent"; and that donors are "assured their gifts will be used for the purposes for which they were given."

Ain't that a hoot? The Pew, as all the world knows, has been paying the Barnes's bills and calling its shots for years. When the Barnes was finally compelled to present an audit of its finances in court, its alleged deficit was found to have been overstated by a factor of between 108 and 150%. "Financial reports are accurate and complete in all respects," right?

Albert Barnes, in his own words

The Barnes Indenture states that all social functions and fund-raising on its premises are prohibited, and that the Barnes will pay the legal costs of anyone bringing evidence that this policy has been violated; Pew knows full well of such events. "PCT . . . expends funds consistent with donor intent." Check. As for conflict of interest, don't even get me started. But, of course, the coup de theatre will be when the Art Museum finally gets its hooks into the Barnes: "Donee is not to be merged in or absorbed by any other institution." Sure.

Pew Charitable Trusts, I'm told, does much good work. It has certainly bought the silence of much of the art world with its largesse as it carries on its destruction of the Barnes, with the merry complaisance of Philadelphia's political establishment and the courts. It has $4 billion at its disposal and claims to act in the public interest, yet like all foundations its board is accountable to no one— not to stockholders, customers, taxpayers or voters. To whom, then, can concerned Philadelphians turn to stop this particular caper in its tracks?