Mood at the Denver Art Museum Is a Mile High

With travel and tourism down sharply since the September 11 terrorist

attacks, many museums are seeing declines in income from admission fees, museum-shop sales, and even hotel and other tourism-related taxes collected by local governments. But not the Denver Art Museum.

Attendance at the museum has remained strong. A “European Masters” exhibit in September helped draw more than double the number of visitors during the same month a year ago. Even after that exhibit ended, attendance in October and November remained fairly strong, keeping the museum on track to easily top the 414,752 visitors logged in 2000.

Fund raising has also been going well. Lewis Sharp, the museum’s director, is especially pleased that the museum recently met its target for a $50-million campaign. The money will go into the museum’s endowment to support a new building that is being financed by a $62.5-million bond from the city of Denver. The building will quadruple the museum’s space and will include a restaurant, theater, and rooftop sculpture garden with mountain views.

“The thing we all feel pretty good about is that that $50-million was raised entirely within our 30-person board of trustees,” Mr. Sharp says. The museum’s board includes several corporate presidents and chairmen, including the chief executive officer of Titanium Metals Corporation and the chairman of US West.

Mr. Sharp feels reasonably confident that the museum can still tap other wealthy individuals in the Denver area, as well as foundations and corporations, to help raise an additional $20-million for the endowment.

The giving demonstrated by the board helps the museum make its pitches to other sources. “We have already had meetings with a number of foundations that are impressed with what the trustees have done, and they are committed to seeing the project move forward,” Mr. Sharp adds.

Mr. Sharp says he feels optimistic about other sources of revenue as well, such as the $5.6-million the museum receives from a local sales tax, a little more than a third of its $15.4-million budget. Since 1988, six Denver counties have collected a one-tenth-of-one-percent sales tax to support local arts and scientific organizations. The tax generates about $30-million a year for 300 local institutions, and to date, forecasts for the sales-tax revenue look fairly strong, Mr. Sharp says.

Nevertheless, he is concerned about what will happen if consumer spending declines in coming months, particularly if, for example, auto sales — which have had high volume in recent months due, in part, to offers of zero-percent financing — drop off.

“You get some people that are pretty optimistic about the Colorado economy and others just say it is gloom and doom,” he says. “Right now it is hard to guess exactly where we are going to come out with this thing.”

While the picture at the moment seems bright, the museum’s board of trustees has still asked Mr. Sharp and his staff to prepare two contingency budgets: One would reflect a 5-percent cut — or $750,000 — in the museum’s $15-million budget; the other would reflect changes needed if income from the sales tax declined 10 percent, or about $500,000.

Even if those contingency budgets become reality, Mr. Sharp says, he hopes to avoid layoffs.

“It’s pretty hard to take the money out of personnel because we are lean to begin with,” Mr. Sharp says. The museum is also trying to avoid cuts in its core art programs. Among the changes it is considering: eliminating special discount rates for group tours, as well as ending the extra hours on Wednesday nights for museum members.

While Mr. Sharp believes the planning will ensure a strong financial footing for his museum in the future, he says the events of recent months make it hard for nonprofit leaders to be certain about anything.

“If this is the ballgame that we have right now, I am cautiously optimistic,” he says. Still, he worries about the possibility of another terrorist attack, or another major corporate failure like Enron’s recent high-profile collapse. Observes Mr. Sharp: “As soon as you have some sense of the playing field, someone else comes at you, which complicates all of our lives.”