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OPINION: The DIA Responds to Anti-Millage Discussion

Some items in July 28 opinion piece are incorrect and others are either taken out of context or do not give a complete picture of the facts about the Aug. 7 ballot proposal, DIA official says.

 

Editor's Note: The following was written in response to a July 28 . The italicized portions below are the points as they appeared in that letter to Bloomfield Patch.

 

2. DIA administration, not the city of Detroit, is asking for the millage for 10 years while the contract with them will end in 5 years. The raised levy from the Tri County may end, all or some, in Detroit treasury.

Response: Totally false. The Art Institute Service Agreement with each of the county arts authorities specifies that if the current operating agreement with the City of Detroit is terminated or amended that the Authority will have no obligation to levy a tax unless a new agreement is approved by the art authority. The money can only be spent in compliance with the contract between the art authority and the DIA and none of it can go into the city treasury.

3. The DIA is doing financially well. Between 2009 and 2011 the assets increased by 50 million dollars to 185 million from 135 million increase by 37%!

Response: Most of that increase is based on an increase in the value of investments in the museum’s endowment following the cratering of the stock market in 2009. In addition, it includes $10 million from the State of Michigan specifically for capital projects, not operating expenses and a $5.5 million reduction in long term liabilities due to the change in the retiree health care plan, an example of the DIA’s prudent fiscal management as it copes with reduced resources.

4. $100 million is available in the bank as unrestricted cash and can be used by DIA at any time.

Response: The $100 million is not unrestricted cash. It includes $57.4 million in board-designated endowment funds and $33.6 million in board-designated funds for non-operational projects. Endowments are designed to generate investment income from their principal, not to have the principal spent down for operating expenses. No responsible funding plan calls for spending endowment principal for operating expenses.

5. Graham Beal, president of DIA compensation was $426.000 plus perks, more than the salary of US president. Governor Snyder compensation is $159,300 annually. Beal partner in the DIA conspiracy is Annmarie Erickson whose compensation is $236,867 plus perks.

Response: While the compensation numbers are accurate, it should be noted that this is not just base salary. The total includes other reportable compensation, bonuses, retirement or deferred compensation, and non-taxable benefits, such as health care. There are no “perks” beyond the compensation.

6. The millage will raise 23 million dollars (Oakland 10, Wayne 8 and Macomb 5 million dollars). This money will be paid by home owners who may have other priorities being elderly, unemployed or having health problems. It is estimated that about 19% of the Tri County residents visit the DIA. Thus these 19% are subsidized by 81% of the population which prefers other entertainments. Moreover, yes, it is free admission to the DIA for the Tri County residents, but admissions are only 3% of DIA revenue. The "free admission" does not include special events, concerts etc. There will be a special charge for it. On top of it there is travel to the DIA and parking.

Response: 79% of DIA visitors were from the tri-county area (Wayne, Oakland and Macomb) – from July 1, 2011-May 31, 2012.

7. In return for giving DIA at least 230 million dollars Tri County residents will get practically nothing. They will get 2 spots on the DIA 44 member forum, but no supervision or control or assets. GM got money from US government and surrendered stocks and other assets, but why does DIA gets a freebie? DIA levy must be rewarded by surrendering DIA assets. What is wrong in creating a DIA branch in Birmingham?

Response: Residents of counties that pass the millage will receive unlimited FREE museum admission, free school field trips, expanded programs for seniors and additional community outreach programs.

11. A troubling question is the fact that governor Granholm eliminated a 10 million annual Michigan contribution. Either the DIA belongs to the city of Detroit or that this gem belongs to our whole state. It is unfair to single out the Tri County because they are thought to have deeper pockets than the rest of the state. 

Response:The only $10 million contribution the DIA received during the Granholm administration was a one-time $10 million grant for capital projects. Cultural organizations across Michigan often receive single grants for capital projects.

12. Rating of DIA per Charity Navigator gives DIA a 2/4 rating or 48% while most museums have a rating that is higher than 60%. This reflects not so good use of available money.

Response: Charity Navigator ranks charities in two separate components, one of which is financial health. The DIA’s two star rating is due to its current financial condition – small endowment and lack of public funding.  Voter approval of the millage will provide operating funds and allow the museum to concentrate its fund raising efforts for the next 10 years on building up its endowment. Both the guaranteed funding of the millage and the opportunity to build its endowment fund will move the DIA much higher on the charity Navigator chart.

13. DIA was compared to Toledo institute of Art which is larger and has no admission fee and is not a burden to Toledo residents.

Response: The majority of Toledo’s $14 million operating budget comes from revenue from its operating endowment of $138 million. The DIA currently receives only 14 percent of its budget of $25 million from interest generated by its $98 million operating endowment.  The millage will allow the DIA to refocus its fundraising efforts to build the operating endowment and move much closer to the Toledo funding model.

Pamela Marcil,

Public Relations Director, Detroit Institute of Arts

About this column: Sound off on your favorite causes and complaints. Tell your neighbors about something they may not have considered before. Letters to the Editor might be edited for grammar, style, brevity and obvious factual accuracy. (We can't check every fact asserted, but if we realize something isn't true, we'll edit it or possibly not run the letter). Please keep submissions to about 300 words or less. Guest columns, for longer pieces that would be featured separately, are also welcome. Submit letters or questions to Bloomfield Patch Editor Art Aisner at Art.Aisner@Patch.com.

NO Dia Tax August 04, 2012 at 07:55 PM
8, 9, 10 - stipulated? 11. The response does not address the question of a "regional" asset only being taxed in 3 counties. The Ohio line is just as far as the northern border of Oakland county - why not MONROE COUNTY? Probably because it wouldn't pass. 12. Talk about deflecting - the REASON the endowment is low is because of the decisions made by Director Beal and the board to KEEP IT LOW and spend the money on other things - like expansions and acquisitions. This same criticism was raised by the AMA (American Museum Assoc.) over 20 years ago. Nothing has changed. 13. The response glosses over the fact that the TMA NEVER took public funds to build its endowment - why should the DIA? 14, 15 - ?? We don't want to nit pick - I think its good that the DIA actually saw fit to respond, but their answers just show the same tired rhetoric with no solutions other than GIVE US YOUR TAX DOLLARS. The troubling questions remain. WHY does a MUSEUM own a FOR PROFIT B & B that loses $80,000 a year? Why do their volunteers COST THEM $12.50 and hours, taking a $786,000 HIT on their 2011 990 page 43? I thought volunteers were FREE? It never ends.
Daniel August 06, 2012 at 01:27 PM
2.) Notice how they down-play and can't give any assurance the City of Detroit won't take the museum back. The taxpayers are supposed to rely on an unelected, unaccountable "Art Authority" to keep tabs on the DIA?? Please 3.) How is this our problem? 4.) FALSE. It clearly states in their audit the $100M is unrestricted & the board can use it as they please. It's "not responsible"? ...okay, so which excuse is it? 5.) Okay, it's still almost 4x the average salary of any municipal/gov't leader. 6.) The Henry Ford & TMA have the same local visitation ratio. I don't see them asking for a millage. Perhaps because they are are well managed. 7.) What about the 2.3 million tri-county area residents that never go to the DIA? How do they benefit from free admission? Where's the fair logic in that? 11.) What about the $16M/year prior? We've been paying for the DIA forever! 12.) That's brilliant! It's like someone with a bad credit score promising the bank their credit will improve AFTER they get a loan. 13.) Their either on drugs or taking everyone for a fool. How about they move closer to the Toledo model NOW? How about slashing their expenses so they won't have to spend TWICE the amount Toledo does for the same size facility? And did they just say $98M "Operation Endowment"? I though they just said they can't use endowments for operating expenses? What an ironic title: "Operating Endowment". I hope everyone sees the nonsense, red herring, circular BS logic they're peddling.
NO Dia Tax August 06, 2012 at 05:56 PM
But the DIA and the city are SEPARATE - you're not bailing out the city with your tax millage dollars ! YA RIGHT ! 2011 990 form Schedule D Page 4 - "Schedule D, Part III, Line 1 - In conformity with allowable museum financial statement presentation practice, the value of the art collection is excluded from the statement of financial position. Title to art objects purchased by or donated to the DIA is offered to the City of Detroit's Arts Department and title is transferred when accession to the permanent collection has been approved by the Board of Directors of the DIA and the Arts Commission of the City of Detroit."
Neal Charness August 06, 2012 at 07:35 PM
Who is NO Dia Tax? The heavy use of all caps (essentially yelling at readers) is very reminiscent of Isaac Baar. If people are not willing to use their name should anyone pay their words attention? Clearly they seem unwilling to connect their name with these statements. Hmmm.
mike smith August 08, 2012 at 01:49 AM
no new taxes period, teach DIA to budget like the rest of us

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