Brandeis University’s decision to “boost endowment” by closing the Rose Art Museum has been met with shock and dismay. According to the Wall Street Journal, Tony Pals of the National Association of Independent Colleges and Universities called the move “the most severe cost-cutting step” a university has taken since the economic downturn. Who could disagree with such a statement? The collection itself is worth approximately $350 million dollars, according to Michael Rush, the museum’s director.
This situation is not, however, a first of its kind. Several schools, including Randolph College in Lynchburg, Virginia and Fisk University in Nashville Tennessee have resorted to such drastic measures in recent times. While Randolph College moved forward, after legal challenges were dropped, with the sale, the Fisk University situation remains in flux.
It is important for all museums and colleges/universities to be aware of the significant risks associated with such a tactic such as breach of contract actions by donors and allegations of charitable intent violations. At the very minimum, a museum must be fully conversant with donor contracts and trusts before undertaking a wholesale auction of its prized work. Rigorous deaccession policies and notice requirements should be implemented and followed by museums to help mitigate donor angst and donor lawsuits. I always recommend that donor agreements include certain language that would address a catastrophic event, such as a museum closing. Although this may not be an immediate concern at the time of the donation, the uncertain economic times call for heightened diligence. At the very least, you will have had the conversation with your donors about the potential for a catastrophic event, however unlikely.
In light of the economic crisis and the economic strain placed on donors and museums alike, now is a perfect time to review your donor contracts, deaccession policies and overall museum purpose. Such a review will not only help ease any latent concerns, it will enable you to adjust your documents and policies to meet the potential for a catastrophic event.