ArtsFund finished the 2008 funding cycle by distributing the largest dollar amount of general operating grants in its history to 70 different arts groups in King and Pierce Counties.  The distributions for 2008 increased by 22.7% above the 2005 level.  At the same time ArtsFund has become more efficient, reducing the size of its staff by 20%.

We have been extremely fortunate during the last three years to have enjoyed a strong and growing economy.  However, the world has changed enormously during the last six months, and the prospects for the immediate future are sobering.

The sources of funding for our annual distributions are four:  (1) contributions to our annual campaign from companies and individuals, including Arts Benefactor Circle donors and workplace giving; (2) distributions of earnings from the endowments held by The ArtsFund Foundation; (3) dividends received from our one-third beneficial ownership of Classical KING FM 98.1; and (4) net income from our ownership of the Century Building. Three of these sources will be impacted by the current economic conditions.  The one most directly and significantly affected will be the earnings from The ArtsFund Foundation.  Those earnings have been approximately $450,000 in each of the last two years.  Unfortunately, we may not be able to obtain any earnings from the Foundation in 2009.  This will create a big hole.

As a result of the economic conditions, we have been advising arts groups to reduce expenses during the remainder of this year and to budget carefully for the next fiscal year.  Those who deal with the problems early are most likely to succeed.

We are not pessimists—not in our genes.  We will start our campaign earlier, spread the net wider and work harder.  The marvelous leadership campaign kick-off gift by the Safeco Foundation of $500,000 over five years gives us hope.  We believe our business and individual donors know that it is not the answer to permit our arts groups to atrophy on the hope that they can be revived after a recovery.  We must protect the vitality of our cultural life.

Borrowing from the Obama campaign, Yes We Can.  As the President-elect said in his historic election night speech, “…let us summon a new spirit of patriotism, responsibility, where each of us resolves to pitch in and work harder and look after not only ourselves, but each other.”