CLEVELAND, Ohio — Cuyahoga County’s nationally admired arts and cultural sector is taking a big financial hit from the coronavirus pandemic that could cause permanent damage and put some organizations out of business.
Those possibilities are suggested by data gathered by Cuyahoga Arts and Culture, (CAC), the public agency that distributes county cigarette tax money for the arts.
The data show that from March to June, the first quarter in which the pandemic took hold, the 65 recipients of CAC operating support had to lay off, furlough or reduce hours for 2,533 full- and part-time employees and contractors.
That number equates to 30 percent of the 8,250 workers employed by the 65 organizations in 2019.
“What we’re experiencing in Cleveland and the Northeast Ohio arts community is painful,” said Jill Paulsen, CAC’s executive director.
Asked whether some organizations would die, Paulsen said, “I think it’s inevitable. The landscape’s going to change.”
It’s too soon to say which groups are closest to the edge, but Paulsen said cultural organizations that most dependent on ticket sales from performances are most vulnerable.
The Cleveland Museum of Art and the Rock & Roll Hall of Fame have reopened, but are operating with restrictions on attendance and events designed to prevent the spread of the virus.
CAC tallied numbers about the financial impact of the pandemic from the museum, the Rock Hall and other big organizations, including the Cleveland Orchestra, plus smaller groups such as Apollo’s Fire, the baroque music ensemble, BAYarts, and Chagrin Valley Little Theatre.
Income lost by workers as a result of the cuts between March and June totaled $8.1 million. CAC said the number can’t be compared precisely to income for the same period in 2019, but it would amount to nearly 16 percent of average quarterly salaries paid out by the 65 organizations in 2019.
Using the same math, the 65 organizations lost $32.5 million in earned revenue from March to June, or nearly 80 percent of the quarterly average for 2019. The organizations also lost contributed income of $9.1 million, or 21 percent of the quarterly average for 2019.
The numbers gathered by CAC offer the first overview of the damage to the local nonprofit arts sector.
Cuyahoga Arts and Culture distributes roughly $12 million a year from money gathered through the county’s 10-year, 30-cent-a-pack tax on cigarettes, approved by voters in 2006 and renewed in 2015.
The $20.4 million in general operating support granted to the 65 qualifying organizations for the two years of 2020 and 2021, or $10.2 million a year, represents the biggest chunk of that money.
During the 2008-09 recession, cigarette tax money helped keep vulnerable organizations afloat. This time around, it may be different, Paulsen said.
“With the 1/8 2008 3/8 recession it was a whole lot of less, over time,” she said. With the coronavirus pandemic, “it’s almost nothing for some organizations, and it’s immediate. It’s much more like a cliff for a lot of organizations.”
Canceled festivals and performances this summer included the Art Renaissance Tremont 2020 series, the Beachwood Arts Council music series, Ingenuity Festival, Wade Oval Wednesday, the Lake View Cemetery Summer Concert Series, BorderLight, and the Cleveland Orchestra Blossom season.
CAC has tried to blunt the impact of the pandemic by paying $5.2 million in operating support for the second half of 2020 to the 65 eligible organizations this summer, instead of scheduling payments as usual through the end of the year.
Paulsen said it was part of a strategy to help organizations maintain a “pilot light” so they could downsize temporarily, survive, and then resume normal activity in the future.
But Paulsen cited national studies, including one by McKinsey & Co., saying it could take the arts sector four to five years to recover from the financial trauma caused by the pandemic.
Cuyahoga County has been considered a national leader in local public funding for the arts because of the cigarette tax, with greater local support than cities such as Boston, Philadelphia and San Francisco.
Paulsen said that revenues from the tax have remained on par with 2019, which she called “a nice silver lining at this moment.”
With losses of more than $41 million recorded by the 65 general operating support recipients from March to June, annual operating grants totaling $10 million or so a year “becomes a drop in the bucket,” she said.
But she added:”We’re happy and lucky with what we have.”
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