Friday, January 11, 2008

...On the Other Hand...

Perhaps I was hasty in stating that I thought Eli Broad's notion that lending rather than giving would be an effective new model for art donor/museum relationships was a trifle naive. I am reminded of the Museum Loan Network, that works to achieve just exactly that same sort of dynamic--and for roughly the same reasons--at its core, the Museum Loan Network "strives to make objects of cultural heritage more accessible to the public by encouraging collecting institutions to share these works over extended periods of time." So what that means in essence is that if a museum has a decent collection of say, pre-Columbian art, but that it just doesn't have the exhibit space to display and so the collection is languishing in storage, not being used or viewed by anyone, that museum can list this collection on the Museum Loan Network (complete with photos and documentation) for long-term use by another museum. In the past, loans carried out in this manner have even been used to populate "permanent" exhibitions (after all, generally speaking permanent exhibits usually only last between 5 and 20 years).

What's more, although recent changes to the tax code have all but obliterated the practice of fractional giving--the act of donating an artwork a little bit at a time over a period of several years--that form of giving was not all that different from a long-term loan, at least until the artwork was completely and finally 100% the property of the museum. With fractional giving, a museum only owned and controlled the artwork for the percent of time in a year that was equivalent to the percent of the artwork donated. For example, if a patron donated 25% interest in an artwork, the museum controlled that artwork for one quarter of the year. During the other three quarters of the year, the artwork was on loan and the donor held the right to ask for its return for that portion of the year. In this way, a donor could take tax deductions in small chunks over the course of many years rather than in one lump sum in one year.

But in 2006, the Pension Protection Act was signed into law, amending the tax code to heavily curtail fractional gifts, chasing away a lot of would-be donors from seeking that particular form of tax deduction. Which again means that perhaps Eli Broad's model is not only a viable one but one that other art collectors will follow. Since they may not be able to receive a tax deduction the way they want (or need) it through their artworks, why not instead use their collections to establish educational foundations that serve as lending libraries to museums? Except, of course, that the newly proposed Promotion of Artistic Giving Act might change all that...I for one will be very interested to see how this all plays out.

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