Beyond Richard Florida: A Cultural Sector of Our Own By Ann Daly	1/3

(Note: This is a sequel to Ann Daly's essay, "Richard Florida's High-class Glasses," originally published in Summer 2004 in the Grantmakers in the Arts Reader. The author thanks all the artists and administrators who so generously shared their experiences of running an arts organization. The author also thanks Bill Bissell for commissioning this essay and Nicole Plett for her editorial counsel.)

Now that Richard Florida has moved on from the "rise" of the creative class to the "flight" of the creative class, the cultural sector is left with the question: are we better off today than before he re-classified us?

Once upon a time, it seemed a promising gambit to latch on to the coattails of the newly-minted, seemingly ascendant creative class. But it turns out (anyone surprised?) that the category is so diffuse as to be meaningless for any other purpose than the theoretical, or–more politically expedient–the rhetorical. Florida's prescription for economic growth–in part, to build the vibrant street culture that is sought after by the creative professionals who drive business development–has yielded no tangible benefits for arts and culture per se.

In my own most creative hometown of Austin, for example, Florida's theories–or at least a reduced version of them–were a boon for the PR machine. But as of yet no policymaking has been undertaken to rescue the eroding base of our famed but fading grassroots arts scene. Despite the best efforts of arts staffers, city leaders continue to focus on exactly what Florida warned against: wooing corporations with tax breaks and other incentives. Artists are left to compete amongst themselves for a slice of the cultural contracts program. We coast along without any sense of urgency to shore up the straining cultural infrastructure and without any real demonstration of belief (lots of lip service, though) in the fundamental role of culture in Austin's future. Only last month was funding approved for a cultural master plan.

Likewise, there hasn't been much obvious success from the sector's "economic impact" strategy, despite hopeful early indicators. Lumping in rock concerts with local theatre productions and dance concerts in order to claim a larger impact for the "performing arts" didn't much impress anyone but ourselves. What we learned from that campaign was that people–even politicians–don't take action based solely on numbers. Besides, there is always going to be another interest that's got better numbers; the arts will never win on economic terms alone. The latest report on the economic impact of the arts may get some media play on a slow news day, but has any such report ever prompted an agency or politician or patron to significantly bump up support for arts and culture?

What does that mean, anyway, to "support" arts and culture? What does the cultural sector require by way of human, financial, and technical resources? How do we need to proceed in order to achieve our goals? Before we're distracted by the next big idea (before Florida, there was Robert Putnam–remember Bowling Alone?), let's seize the moment to get clear about where we stand, and what we need to do. To that end, I make five modest proposals.

1. The cultural sector needs to look beyond institution-building

Once upon a time America was giddy with its own cultural energy. We could indulge in fantasies of arts institutions as invincible as corporations anchoring towns and cities across the country. The Ford Foundation envisioned that brave new world, and used the matching grant as leverage to ensconce these behemoths in our midst.

Back then, we couldn't foresee that lean-and-agile would supplant large-and-stolid as the growth mode of the 21^st century. Or that the number of nonprofit arts organizations would explode from about 8,000 in 1965 to 50,000 in 2004. "Sustainability" wasn't yet part of the lingo.

It turns out that arts institutions are no more invincible than their corporate prototypes. Even the most successful of arts institutions today are straining under their own weight. Young and mid-life 501(c)(3) organizations are regrouping, or folding. Emerging artists, without any investment in the corporate ideal, don't think twice about bypassing that model altogether. They feel much more kinship with the energy of a start-up.

In an informal, random email survey I conducted with artists in all disciplines across the country, I encountered a groundswell of dissatisfaction about the generally accepted model of a corporate-style 501(c)(3), with board and manager. The board is too cumbersome, and the manager unaffordable. Within that classical hierarchical structure, my respondents told me, the tail begins to wag the dog. For young companies, the administrative demands threaten to displace the primacy of the artmaking, because artistic directors are doing double-duty as company manager. Companies that want to expand find it nearly impossible to make the necessary leap in the business life cycle from sweat-equity to professional management. For companies that prefer to remain flexible, there simply isn't any payoff from the bureaucratic set-up.

I heard from a lot of artists and arts organizations who had dropped out of the 501(c)(3) model altogether, choosing instead to remain informal, working from project to project, less bogged down in board meetings and IRS paperwork. Two trends emerge here. First, the increased importance of fiscal sponsorship programs, which enable these artists to apply for non-profit funding under the umbrella of a 501(c)(3) organization. Second, the turn toward entrepreneurship.

I heard from individuals and groups who have made a conscious decision not to structure themselves as non-profit organizations. They run the gamut from sole proprietorships to S-corporations to limited liability corporations. As one arts agency administrator wrote to me: "the traditional paradigm of non-profitism and boards is dead in the water." More and more artists are looking for a market niche rather than a grant. My personal favorite is the former lawyer who stages performances for attorneys to earn continuing education credits. Others choose to partner with 501(c)(3) organizations, as a way to bypass paperwork and build audiences at the same time.

Nevertheless, in some traditional contexts the 501(c)(3) model is still the route to "legitimacy." One choreographer described it as providing a stable structure that overcomes the limits of informal management and offers a "framework for action." It provides, she has found, "self-containment, independence, validation, continuity, and fundraising." But even those remaining as 501(c)(3) organizations are radically rethinking its structure and process, resisting the imprint of institutionalization. They are experimenting with flat organizations inspired by collectives of the 1960s. Some organize in flexible interlocking circles they call "pods," others share directorships, still others have invented "virtual" boards without the necessity of routine, large-scale meetings.

Inspired by the social entrepreneurship (or social venture) movement, others are looking to hybridize the for-profit and the non-profit by exploring the possibilities of structures like subsidiaries and limited partnership models. Artists are devising revenue-generating projects that exploit artistic skills, provide artist employment, and leverage assets (like real estate or costume/set inventories), while contributing to a core mission. The ideological line between "for-profit" and "non-profit" is blurring, as artists aggressively identify and structure earned income streams for their art, their skill sets (e.g., pilates and technical, business, or arts consulting), their rental space, and their intellectual property. I heard about a bed-and-breakfast that will help to support an art gallery/school/studio, a combined non-profit/LLC with a retail store, an arts agency that hires out its expertise in project management to the private sector, and an "investment" model for building stakeholder involvement.

Artists are making a virtue out of necessity. They are leading the way into alternative organizational models that better suit the realities of a diminished funding base in a highly networked society. And they're waiting for the rest of us to catch up.