Thursday, January 1, 2009

Philadelphia's Mayor Taking Heat for an Unscheduled Grant of $250,000 to a Local Arts Organization

On December 30, 2008, the Philadelphia Inquirer reports that Mayor Nutter of Philadelphia is under fire for an unscheduled grant of $250,000 to the Philadelphia Orchestra Ensemble.  While it may not be unusual for a mayor to support a city's orchestra, which happens to be the premier orchestra in the city and of vital importance to the city's tourism and self-identity, it was out of the norm in this case.  In looking for the unbudgeted funds, Mayor Nutter tapped the funds of the Philadelphia Cultural Fund, an independent nonprofit, with a board of its own.  Board members were not consulted, and many are upset that the Fund's internal review processes were ignored in this situation.  Board members owe fiduciary duties to the nonprofits they serve.  Those duties include being informed, actively participating in meetings, and ensuing that the nonprofits have internal processes for decision-making and that those processes are followed.  This is a good example of Board members doing the right thing and insisting on performing their duties.  For more, see the brief excerpt below:

Last spring, as city revenue projections began to look shaky, Mayor Nutter met privately with Harold Sorgenti, chairman of the Philadelphia Orchestra Association, and agreed to provide a $250,000 unscheduled grant to the city's premier music ensemble.

No announcement of the gift was made, and no funds had been previously budgeted for the orchestra. Where would the money come from, officials wondered. They decided that the city's allocation for the Philadelphia Cultural Fund could be tapped without a problem.

It's a decision that has riled some members of the fund's board, who argue that the Nutter administration, while generous to the arts, has now undermined the integrity of an arts-funding process that was explicitly designed to steer clear of the muddying influence of politics.

"My understanding is that the amount of money decided on for the orchestra was a decision that the City of Philadelphia made," said Cheryl McClenney-Brooker, president of the board of the Cultural Fund, which is an independent nonprofit entity.

"That was outside of our process," she said. "We were told about it, and there were board members who took exception with that."

For the full story, please click here.

AMT

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