The Chairman's Chump Change? A
$56,000 Expense Account
The Barnes Foundation's 1995 tax records show that the Foundation reimbursed board President Richard Glanton for "business expenses totaling $56,249 during the year 1995."
Those who think that over $1000 a week is small change should note that the Foundation does not list a single employee with a salary above $50,000. While Glanton pleads to the courts that the Foundation is going broke, his 1995 expenses are nearly 5% of the total 1990 operating budget.
There is no indication where the money was spent, although we note expense categories on the tax form including $73,153 for "travel" and another $75,327 for "miscellaneous." In 1993, Glanton was reimbursed for $29,272 in expenses including "legal expenses, traveling expenses and various expenses related to the international educational art exhibition." That year the Foundation's paintings went to Washington and Paris and Tokyo with venues to at least three other cities in the offing. In 1995 the only out-of-town venue was Munich.
Later in this newsletter, we cover the continuing budget inflation and its adverse effect on the Foundation's endowment. Responsible fiscal policy would indicate some serious belt-tightening. This might be a little tough for a president whose wife, in courtroom testimony, called the pricey Swan Lounge at the Four Seasons Hotel "an extension of our home."
Orphans' Court Rulings Upheld in
The September 21, 1995 Orphans' Court ruling which expanded public visitation an extra day per week, and increased the admission fee from $1 to $5 was upheld by the Superior Court on September 12, 1996. The Barnes Trustees had petitioned the Court for unlimited discretion to set the days and hours of public admission and to set fees as well. At the time of trial, they suggested they would be open as a museum six days per week, and charge $10 admission, which would include mandatory purchase of an audio tour.
On the issue of increased public access, Orphans' Court Judge Stanley R. Ott ruled that "the Trustee's proposal would transform the Foundation into a full-time museum, which goes far beyond the donor's intent." He allowed one extra day of public admission to "accommodate competing interests" of the public gallery use and the Foundation's educational program. He reduced the requested $10 admission fee by half, and allowed the Trustees to set their own separate, but not mandatory, fee for audio tours. He found that the $10 fee "would likely discourage the 'plain people', i.e. the working class whom Dr. Barnes most wanted to view his collection, from visiting the Gallery." Currently those who want the audio tour must pay an additional $5. Foundation documents show that less than a third of visitors do so.
In upholding Judge Ott's decision, the Superior Court reasoned that:
In this case the appellant [the Trustees] fell woefully short of satisfying its burden in demonstrating the necessity for access of six days per week, or the tenfold increase in the admission fee. At the hearing before Judge Ott, appellant failed to produce any reliable evidence concerning the true financial picture of the foundation: appellant did not produce any recognizable financial statements, bank statements, tax returns, budgets or audited reports. [Emphasis in the original]
The Superior Court panel also dismissed two faulty arguments repeated by the Foundation's attorneys in numerous appeals:
Appellant argues that it should have prevailed below because the evidence offered was "uncontradicted," and the proposed changes were "approved" by the Attorney General. Such an argument has no foundation in law. The mere fact that evidence is uncontradicted does not automatically imbue that evidence with sufficient weight to sustain one's burden of proof. Additionally, although the law requires the participation of the Attorney General's office in any proceeding to modify the terms of a charitable trust, appellant cites no support for the proposition that the Court is bound by the position espoused by the Attorney General, and a reviewing judge must exercise his or her independent power of review. [3231 PHL 1995, p.9]
Given this strong support for upholding the terms of the Indenture, one might wonder why the Superior Court did not reverse Judge Ott's addition of an extra day of public visitation. Remember, the Superior Court concluded that there was no reliable evidence of the Foundation's true financial picture and the Trustees' basis for expanded museum use was the purported need for extra income.
The bottom line is that no party with standing objected to Judge Ott's decision so the Superior Court accepted it. The de Mazia Trust accepted the ruling on admission days and fees, and the Friends of the Barnes Foundation, who participated in the Orphans' Court hearings, did not file a brief or argue any of the appeal issues. This brings us to the final issue, the Indenture's ban on society events, which Judge Ott uncompromisingly upheld. The de Mazia trust did not support Ott on this issue, and as in so many cases in the past, the Superior Court rolled over on this one.
Glanton's Plan to Open Next Summer - A Clear Indenture Violation
During the November 13, 1996 zoning hearing in Lower Merion, the Board Chairman asked Glanton if the Superior Court's September 12, 1996 Order allowed the Foundation to be open in the summer. Glanton replied: "Of course it does." A reading of the Order reveals no such thing. The Order does not further amend the language of the Indenture in any way. It upholds the Orphans' Court changes which only allow one additional day of public admission per week at a fee of $5. There is no mention in either ruling about the July/August restriction.
The Trustees did not appeal the Superior Court's September 12 ruling, and must have felt there was no case for reversal. The Superior Court is well aware of the Indenture language which closes the Gallery during the months of July and August. Their Opinion quoted it directly. Since the Court found no basis on which to allow additional public admission, clearly there was also no basis for removing the summer restriction. The Superior Court did leave the door open for another attempt to change the Indenture in front of the Orphans' Court "based on some subsequent events which would demonstrate a necessity for a further deviation from the terms of the indenture." So expect another "emergency petition" to the Orphans' Court sometime late next Spring.
Superior Court Rolls Over Again - Allows Special Privilege "Fund-raisers"
In its September 12,1996 decision, the Pennsylvania Superior Court reversed a Montgomery County Orphan's Court ruling which had upheld the Indenture's ban on special privilege events. In his ruling last September, Judge Stanley R. Ott found that:
The Trustees argue that the fundraising activities they hope to hold on the Foundation's property do not fall within the parameters of the "society functions" prohibited by Dr. Barnes. The Foundation established at the hearing that its development strategy would be to stage events geared toward attracting future benefactors. To state the obvious, there would be nothing "democratic" (Dr. Barnes' word) [as used in the Indenture] about the guest lists. Those not in a position to make a pledge to the Foundation would not be invited. It is clearly not possible to reconcile the Trustees' proposed clarification with the intent of Dr. Barnes in Paragraph, 33 of the indenture. [Memorandum Opinion and Decree, 9/21/95]
The Superior Court did not address the Barnes Trustees' flimsy argument that the definition of "society" had changed since the Indenture was written in 1922. Instead, Judge John T.J. Kelly, Jr. resorted to what is known as a rule of construction. A legal expert close to the case noted that when there is no solid legal basis for a decision, one resorts to rules of construction. A cursory examination of the Indenture reveals that even this tactic was faulty.
In interpreting the language of the [Indenture] paragraph, we are aided in our work by the construction principle known as ejusdem generis, which provides that when words of general meaning are preceded by, and connected with, words of narrower impact, the interpretation of the words of general meaning will be confined to the species of things more specifically described. [emphasis added]
He quotes a portion of the Indenture referring to prohibition of "any society functions commonly designated receptions, tea parties, dinners, banquets, dances, musicales or similar affairs." Kelly argues that by the principle of ejusdem generis, the generic term: "similar affairs," when preceded by the specific types of events "receptions, tea parties, dinners, banquets, dances, musicales" is thus limited to those events only. He concludes that since fundraising events were not among the listed specific types, they are not included in the prohibition.
Even as applied by Kelley, the ejusdem generis argument falls flat. Although Kelly quotes only a carefully excerpted section of the Indenture paragraph, the term "society functions" serves as the "words of general meaning" and the "words of specific meaning" follow and do not precede them, and therefore the ejusdem generis rule does not apply to this case.
Perhaps more egregious is Kelly's failure to include the full text of the Indenture paragraph in his decision. Kelly omits the first sentence which reads "The purpose of this gift is democratic and educational in the true meaning of those words, and special privileges are forbidden." In so doing, he ignores the even larger case of "general meaning", namely all forms of special privileges. This term, coming at the beginning of the whole paragraph totally invalidates his ejusdem generis argument.
Also, by omitting the sentence which establishes the donor's reasoning for the ban on these events, Kelly submarines the basis for Ott's decision. Ott's conclusion, that "To state the obvious, there would be nothing 'democratic' about the guest lists." is based on the central theme of the paragraph: "The purpose of this gift is democratic and educational." Kelly never mentions this principle and instead invents his own reason why Dr. Barnes banned these events: "It is obvious that the late Dr. Barnes did not wish to have his school and gallery trivialized by the use of it as a mere rental hall for socialites." To him, "there is a decided difference between fund raising functions... and a social affair which has as its purpose the inclusion of some and the exclusion of many." In this conclusion, he ignores the trier of fact, Judge Ott, who having heard the testimony of the Foundation's witnesses, concluded just the opposite: there is nothing democratic about the events the Foundation proposed to him.
At the time of his decision, the Foundation had already violated even Judge Kelly's liberal interpretation of the Indenture. One of the re-opening events in November 1995 was the rental of the Foundation by Meridian Bank for its private guests. The event was approved by an emergency Superior Court panel of Judges Cavanaugh, Hoffman and Rowley. Judge Cavanaugh later sat on the panel with Kelly that defined "a rental hall" as different from the "fund-raisers" which they approved. Since it seems clear that no opinion will ever be issued on the November 1995 ruling, Judge Cavanaugh will not have to reconcile this judicial flip-flop.
For some reason, Kelly felt it appropriate to mention that the special privileges Indenture paragraph:
...will continue to include the safeguard from abuse which Dr. Barnes intended. i.e. that "any citizen of the Commonwealth [may] present to the court a petition for injunction based upon what reputable legal counsel consider is sufficient evidence that the above- mentioned stipulation has been violated."
Given the Superior Court's track record, however, of coming through for the Glanton/Kauffman team in last minute emergency rulings, it is a safe bet that any injunction issued by a lower court would be neatly reversed right before the caterers arrive. Regardless, the potential for failure in the appellate courts should not discourage citizens from attempting to defend Barnes' wishes. Dr. Barnes did not require that the petition for injunction be successful, only that reputable legal counsel consider it to contain sufficient evidence, at which point the petitioner "shall have his total legal expense paid by the Barnes Foundation."
Ballet Party Violates Superior Court
On September 25, 1996 donors to the Pennsylvania Ballet had a "private tour and reception" at the Barnes Foundation. According to the report in the Inquirer, a ballet trustee made an unspecified donation to the Barnes Foundation. Barnes President Richard Glanton also told the reporter that the event would benefit "both organizations."
By Glanton's own admission, the event violated the September 12 Pennsylvania Superior Court ruling that "nothing in the [Barnes Indenture of Trust] prohibits fundraising functions which have as their sole purpose the raising of funds for the institution." The event was essentially a rental of the Foundation by the ballet's fundraising people, which Glanton had previously testified would not be allowed.
[By an attorney for the de Mazia Trust]: Let's suppose a firm was willing to pay money for the privilege of having their event at the Barnes Foundation. Is this the type of fund-raising event you anticipate the Barnes board considering?
[By Mr.Glanton]: No.
Thus, Glanton has exceeded the bounds of those circumstances upon which the Superior Court granted limited permission to hold "fund raising events."
While the Superior Court's decision to allow any social events in violation of Dr. Barnes' express wishes was dubious at best, Glanton's comment that such parties are "always going to benefit both the Barnes and the organizations we work with" shows that he has no intention of obeying the Court's ruling that the sole purpose be the raising of funds for the Barnes Foundation.
Tours Continue on School Days
The Trustees continue to allow paid tour groups on non-public-visiting days. In 1995, the Orphans' Court limited public visitation to three and a half days a week, thus preserving equal time for the educational program, at least in principle. Glanton has attempted to justify this blatant violation of the Foundation's by-laws and Court rulings by claiming that a "lecture" is given to the groups and calling the tours "an abbreviated class."
Recent zoning hearing board testimony, however, including audio and video tape documentation, reveals that at least some of the tour groups on non-public days have no lecture and are simply given private tours. Even if they give the lecture, the Trustees are violating the Indenture's mandate that on those days when the gallery is not open to the public, its use is to be "solely and exclusively for educational purposes -- to students and instructors of institutions which conduct courses in art and art appreciation." The touring groups, lecture or not, do not meet this criterion. As we go to press, a local resident has petitioned the Orphans' Court for an order to "show cause why the Barnes Foundation should not be held in contempt" for such activities.
Superior Court Reverses de Mazia
On September 9, 1996, The Pennsylvania Superior Court reversed Montgomery County Orphan's Court Judge Stanley Ott's July 10, 1995 decision in which he rejected alterations to the Violette de Mazia Trust that were the basis of a settlement agreement between Trustees of the de Mazia Trust and the Barnes Foundation.
The reversal, by Judges Cavanaugh, Kelly and Olszewski (the same panel that days later ruled on the Barnes Indenture issues discussed in this newsletter) ends the de Mazia Trust's involvement in all Barnes litigation. The de Mazia trustees have now forfeited their right to oppose changes to the Barnes Indenture of Trust. They must also drop their suit seeking removal and surcharge of the Barnes Trustees for breach of fiduciary responsibility in connection with the $2 million gift to Lincoln University. That gift by the Newhouse Foundation preceded the trustees' award of the valuable Barnes catalog contract to Knopf, which is owned by the Newhouse family.
Not only did they forfeit the right to litigate against the Barnes trustees, but the de Mazia Trust will hand over $2.75 million to the Barnes Foundation over the next six years. Their only benefit? A cessation of the Barnes trustees' dubious lawsuit which claimed the corpus of the de Mazia Trust consisted of paintings that were rightfully Barnes Foundation property. The de Mazia trust will cease to be a support organization of the Barnes Foundation. Meanwhile the Barnes trustees made a meaningless promise in exchange for the $2.75 million pay-off, that "a principle function" of the Foundation will be to teach, promote and advance the aesthetic method, theories and principles espoused by Dr. Barnes in his writings." However, the de Mazia trustees have no recourse or legal standing to protest if the Foundation fails to do so.
In disallowing the de Mazia Trust to reorganize as a separate entity, Judge Ott recognized the proposed changes as "substantive, fundamental and sweeping." he found that such changes could not be dismissed as merely "administrative" -- the only sort of modifications permitted under the doctrine of deviation cited by the de Mazia attorneys. Ott found that: "It is clear the requested revisions submitted by the de Mazia Trustees are material and basic to the trust's raison d'etre, and not at all administrative in nature."
The Superior Court Opinion by Judge Kelly is bloated to twenty nine pages with encyclopedic recitals of cases where courts permitted changes to various trusts. Kelley spends less than a page addressing Ott's decision. He completely ignores Ott's finding that a deviation must be denied, since the proposed changes are "material and basic, not at all administrative in nature." As in his decision to allow special-privilege social events, Kelly distorted the record by omission, and selectively created his own version of the case. In his version the only basis for Ott's decision is that "the sanctity of the donors' written intent is more compelling than the immediate but short-sighted benefits for approving the agreements sub-judice."
In one of the most vacuous judicial statements this case has seen, Kelly concludes:
Although we agree in principle with Judge Ott that the sanctity of the donor's intent should be honored and upheld whenever possible, we are convinced that the benefits of approving the present settlement will go further to advance Ms. de Mazia's intent than forcing the parties to continue in what has obviously become a bad marriage...
And while Kelly is willing to ignore the Knopf catalog case which points to an abuse of fiduciary responsibility by the Barnes trustees -- the same trustees whose trampling of the original mandate of the Foundation's Indenture his court has repeatedly embraced -- he claims concern that this was "... a marriage which threatens to damage or destroy one or both parties' respective abilities to benefit the citizens of this Commonwealth." Never mind that the Barnes trustees will now be free to do their own destruction, unchecked by the sole party who had the financial resources and legal standing to ensure that the citizens of the Commonwealth would benefit in the manner intended by Dr. Barnes.
For the record, we quote Judge Ott's instructive discussion of "whether changed circumstances mandate a redrafting of the [de Mazia] will."
The Trustees contend that, during Miss de Mazia's lifetime, the Barnesian educational program was the sole mission of the Foundation, and the only mission she intended to support. The museum function, which appears to be the focus of attention for the current Barnes Trustees, was not her concern. Otherwise stated, the change of circumstances is that the two sets of Trustees no longer see eye to eye. This development does not change the fact that Dr. Barnes set up the gallery "to the end that the educational work for which [the Barnes Foundation] is organized may be adequately accomplished." (Fifth WHEREAS clause of the Indenture.)(Emphasis added. [by Ott]) The court does not accept the argument advanced at the hearing on the settlement agreement that the Barnes Foundation is required only to promote some art program, and not necessarily the Barnesian program. Dr. Barnes developed this philosophy himself (in conjunction with John Dewey) and any claim that he did not necessarily intend for his Foundation to be the standard bearer for this method of instruction borders on the absurd. [Emphasis added in last sentence only]
... the Barnes Trustees have expressed a renewed pledge to carry on the Barnesian art education program. While this new promise is reassuring to hear, the Foundation's "raised consciousness" is, in reality, nothing more than a reiteration of that which the Foundation is already bound to do - carry out the terms of Dr. Barnes' trust indenture.
In view of their long history of close collaboration,
Dr. Barnes and Miss de Mazia would undoubtedly be chagrined, if
not horrified, at the current Trustees' desire to go their separate
ways. The court firmly believes and counsels the Trustees that their
ideas and egos should bend and compromise to restore a sense of
cooperation between the two organizations as their founders contemplated.
It is not the terms of the trust, designed by Miss de Mazia to last
in perpetuity, that should yield. Nor should part of Dr. Barnes'
mission be allowed to fall by the wayside. While mindful of the
fact that this decision runs contra the half-hearted recommendation
of the Attorney General's Office, the court finds the need to preserve
the sanctity of the donors' written intents more compelling than
the immediate, but short sighted, benefits of approving the agreement
Superior Court's Selective Version
In their Opinion on the settlement the Superior Court quoted Judge Ott's Procedural History of the case almost entirely. But they left out a paragraph which states:
The admission policy as originally established provided for the gallery to be open to the public (except for educational classes) on Saturdays, except during the months of July and August, between the hours of 10:00 a.m. and 4:00 p.m., and for the gallery and arboretum to be closed to the public and students on Sundays.
This same panel recently issued an Interim Order without an opinion on July 2, 1996 allowing the Trustees to open the Foundation to the public in July and August "notwithstanding any contrary language in the indenture." Thus it appears the Court did not want to advertise the fact that there was explicit language closing the Foundation during these months, which the Court must have known since the Court was considering the settlement appeal during the same time. The omitted text also exposes that the Foundation always had a public admission policy (applicable after the death of Dr. and Mrs. Barnes), a fact which has escaped the mainstream media for years as they parroted the Walter Annenberg story that his lawsuits and editorializing brought public access.
The Attorney General's Rewrite of
In a recent letter, Attorney General Thomas Corbett claimed that "We have never supported deviation from the Indenture without prior judicial approval..." An interesting re-write of history since on three separate instances his people, presumably at his direction, did just that.
In the emergency appeal of the November 2, 1995 Orphans' Court of Montgomery County decision, Deputy Attorney General Barth supported the use of the Barnes gallery for a fundraising event which the trial judge refused to allow.
At the May 10, 1996 appeal argument of the September 21, 1995 Orphans' Court decision to limit public access to three and a half days, and to uphold the Indenture's prohibition against society events, Barth supported reversal of the trial judge. The Superior Court's September 12, 1996 ruling even notes that "proposed changes were 'approved' by the Attorney General." before the trial judge ruled against the Trustees on the matter.
At the same hearing Barth also supported reversal of the trial judge, who refused to allow the re-organization of the de Mazia Trust as an entity independent from the Barnes Foundation.
In all three instances, the Attorney General's actions were clearly not made "with prior judicial approval." One begins to wonder if the man at the top has any idea what is really happening, or if this is more of the same posturing typical of his predecessor, who is now doing time in jail. Ernie Preate had a similar disregard for the facts. In a response to letters from concerned individuals, he wrote that upon receipt of the trustees' 1991 petition to sell paintings, "My office immediately announced our opposition to the sale." No such announcement was ever aired in the local media, and in fact, his office filed no response to the petition to sell.
New Financial Hoax: The Expanding
The lack of hard data proving the impossibility of running the Foundation according to the terms of the Indenture caused the courts to refuse the trustees' request to operate as a full-time museum. However, since the Superior Court left the door open for future attempts to modify the Indenture, "based on some subsequent events," the financial management of the Foundation continues to be a critical issue. As in the case with the bogus renovation budget by which the courts allowed the painting tour, the trustees must create a perception that the Foundation is in dire financial straits before returning to the Orphans' Court for more Indenture changes. The trustees set the stage for this in a November 10, 1995 press release:
Judge Ott's ruling set admission at $5 per person. This level, combined with the current three-and-one-half days per week visitation, provides the Foundation with less than 30% of the revenue projectioned [sic] for six-days-per-week, $10 per person. "It is critical to the survival of the Foundation that we be able to earn the projected $1 million from admission fees; anything less will not allow the Foundation to meet its operating expenses," Glanton explained.
How does an institution which ran a $164,921 surplus on operating expenses of $1.1 million in 1990 end up needing an additional $1 million in admission fees only five years later? The latest financial figures supplied by the Foundation give some clue.
In 1990, the year Glanton became president, salary- related budget items totaled $480,108. By 1995 the figure had ballooned to $673,950. Our estimates for 1996, based on third quarter cash reports are up to $801,750. The rapid escalation began during Glanton's first full year as president with a 27% increase in these costs.
Other areas are similarly affected. Security went from $200,140 in 1990 to $289,046 in 1995 and can be expected to top $300,000 in 1996. Curiously, the nearly $1 million in renovation expenses the trustees had claimed was necessary for security equipment was supposed to temper increasing security labor costs. From all appearances there are less people working the gallery than in 1990, so one might wonder why the security costs have continued to rise so dramatically.
Occupancy, which includes the cost of utilities, went from $68,926 in 1990 to $149,770 in 1995 and an estimated $170,996 in 1996 based on the first three quarters. Another big increase is insurance, which was $38,349 in 1990 and went to $133,005 in 1995 and was already $124,108 by September 30, 1996. It is possible that the premiums have increased due to the lawsuits brought against the trustees, which insurance companies have had to pay to defend. The first big jump took place in 1993, the year after the de Mazia Trust petitioned for removal and a $2 million surcharge against the trustees.
Then there are the continuing legal fees. In 1995 the foundation spent $426,607 in "professional and consulting fees" and so far for 1996, this item, which is mostly legal fees, is up to $493,156. Pre-Glanton, this budget item was routinely less than $30,000.
Using the estimated figures for 1996 (professional fees and insurance are third quarter actuals) the above items alone come to $1,890,010. In 1990 these items totaled $849,712. Even allowing for the minimal inflation rate over the past several years, it is clear that the Foundation is no longer being run in the efficient manner that had served it so well before the arrival of its current managers.
Another aspect of the budget inflation has been its adverse effect on the Foundation's endowment. In 1990, investments in securities at cost, adjusted for amortization, were $9.2 million. By 1995 this figure dropped to $6 million.
We cannot be sure exactly which expenditures were designated to invade endowment, but there are some clues. In 1992 Trustee Charles Frank testified to invading endowment "to the tune of about $200,000." In 1995 he testified that Glanton told him that legal fees for the Foundation's Civil Rights suit against Lower Merion Township would "come out of the endowment, like the paintings case" -- a reference to the lawsuit against the de Mazia Trust, which dragged on for four years. A recent motion filed by the Lower Merion commissioners refers to Frank's opposition to "the use of Barnes endowment funds to publish a promotional brochure." [Inquirer, 11/27/96]
Thus, as the trustees knowingly overspent the endowment income and ate into its principal, they ensured that the endowment would no longer be able to provide for the basic operating costs of the Foundation, which it had done for seventy years prior to their control. Normally the attorney general might be expected to step in and enforce some fiscal restraint. As we begin four years with an attorney general that Glanton and his law firm spent over $20,000 to help get elected, expect little action here.
Lawsuits Continue Drain on Foundation
In a March 26, 1996 letter to the Inquirer, Glanton stated "I do believe we can resolve this dispute, and we stand ready to do so as quickly as it can be accomplished. All we want now and have ever sought is a parking lot..." Three months after the parking lot was approved, the Foundation continues to pursue its dubious Federal Civil Rights lawsuit against the Township of Lower Merion and its commissioners. The legal fees for this hostile action mount with no end in sight. The most recent abuse of Foundation funds is on planned depositions of each of the seventeen neighbors originally named in the suit, despite the fact that Federal Judge Anita Brody dismissed the Trustees' petition against them.
The action against Lower Merion Township is not the only drain on Foundation resources. The City of Rome continues to press its suit which claims that Glanton reneged on a deal to have the Barnes paintings go to Rome for $3 million and chose instead to send them to Munich for $750,000 less. While we can only guess what the cost to the Foundation will be for Glanton's actions, it is clear that he is sparing no effort to clear himself and his fellow trustees.
Foundation lawyers filed a six-count counterclaim in the Rome case which alleges, among other things, that the only reason Lincoln University-appointed trustees Shirley Jackson and Niara Sudarkasa were named as defendants was "solely as a means of harassing them, and not for any good faith purpose." The counterclaim also charges the plaintiffs with "a pattern of racketeering activity ... to deprive people of property through a pattern of fraudulent activity, including mail and wire fraud." Rome's lawyers said the racketeering charge was filed "with the headline writers of the Legal Intelligencer and not the facts of the case in mind." [Legal Intelligencer, 10/1/96]
Attorneys for the City of Rome have asked the Federal Courts for Glanton to produce his client list at his law firm Reed, Smith, Shaw and Mc Clay. They allege that "Glanton used the negotiations with the City of Rome and Munich as a subterfuge for acquiring business contacts and clients for his private legal practice." They also claim that Reed Smith held a party at the Munich venue for up to 500 people. In recent months the New York Times featured an article on Reed Smith's expansion into the international marketplace. Their addition of a Manhattan-based office was seen as providing the kind of "cachet" impressive to international clients. No doubt an attorney in the firm who can also bring a world-famous art collection to your city, or offer its gallery for party space, would also be a valuable asset.
Financial Data Demonstrate Conversion
As the endowment has been eviscerated, the trustees have moved to fund operations by full-fledged use of the Foundation's gallery as a museum, and the exploitation of its collection in the commercial marketplace. Third quarter 1996 cash reports show over $500,000 in revenue from gallery and arboretum admissions and audio tour rentals. (Note, this includes about $80,000 in audio tour rentals which the Foundation leases at $100,000 per year.) Licensing fees on everything from tee-shirts to coffee mugs brought in $127,157. And net cash flow from the Gallery shop was over $250,000.
Thus it is no surprise that a land planning expert concluded in the Lower Merion zoning case that the Foundation's use has gone from an educational institution to a museum. [Inquirer, 11/22/96] Our concern is that the puffed up budgets necessary to sustain this commercial operation will be difficult to reverse should the courts ever rule that the Foundation must return its primary operation to a school. The trustees will argue as in the past that they must continue to expand the museum use to remain solvent.
More Aesthetic Calamities
The current trustees began disrupting Dr. Barnes' purposeful gallery layout and visual elements even before the 1993-95 renovations. Included in this was the removal of two large hollies from the gallery front entrance. During the renovations numerous permanent changes were made to the layout designed by Dr. Barnes. This included the complete elimination of a room of furniture and decorative objects on the second floor -- no accounting has been made for these items, and the addition of a gallery shop and "orientation room" on the lower level. This is essentially a television parlor advertising their computer CD-ROM and video tapes produced at the current trustees' direction.. Both items are for sale in the adjacent store.
Since the last Barnes Watch issue, additional defacements include large signs advertising that the "Gallery Shop Closes at 4:30 PM" installed in the entrance foyer and first-floor stairwell, and a large posting of instructions for operation of the audio tour, which assaults viewers as they enter the main gallery. Their presence creates a visual disruption the moment one enters the gallery, while serving the intended purpose to inform each visitor, before they have seen a single piece of artwork, not to get too carried away with the paintings and to leave time to do some shopping.
Down the stairs, huge reproductions of correspondence by Dr. Barnes have been installed on the walls. The purpose of posting selected letters regarding Lincoln University appears aimed at inflating Lincoln University's relationship to the Foundation. Not included here are later letters to Lincoln's president wherein Barnes called Lincoln "an ivory tower with all the doors and windows hermetically sealed" or the letter to its dean of students stating that "this year the experiment with Lincoln failed" or the one three weeks before Barnes' untimely death, in which he tells Lincoln's president that unless his proposals were implemented at Lincoln he would "prefer to pass out of the picture." It is, to say the least, disturbing that the new stewards of this educational institution should present visitors with such an edited version of history.
On the same floor, the gallery shop has now expanded past its doors, with items lining both sides of the connecting hallway. The Barnes publications authored by Dr. Barnes and Violette de Mazia have been confined to a small antique hutch and inside the shop and out it appears that various Foundation antiques have been pressed into service as display hardware. It is a disgusting but fitting metaphor for what has happened to the entire institution: everything of genuine value has become the backdrop for the commercial agenda of the current trustees, an inducement to get folks to spend their money. The gallery has become a way to attract customers to the shop full of posters, clothing, jewelry and ric-rac. More recently the gallery has also become an enticement to give to whatever charity happens to be renting the space for the night. (See related story on the recent party.)
New signage has been popping up all around the Foundation, from the front of the building to the gallery stairwell to above the gallery doors and below individual paintings. It is only fitting that a new bronze placard has been installed at the front gate: "The Barnes Foundation" with a bas-relief reproduction of a wooden African door from the collection. Not only is the sign poorly composed, but it is not at all in keeping with the intended look of the iron front gate. In the original gate are the letters BF, the only indication Dr. Barnes wanted as to what lay beyond. It should only be a matter of time before the "gallery shop" hours are posted on the front gate as well.
Zoning Board Allows Parking Lot
On September 3, 1996 the Lower Merion Township Zoning Hearing Board approved the Barnes Foundation's request to pave a section of its arboretum for a parking lot. The lot will occupy the south-east corner of the arboretum, behind the greenhouse. A bus driveway, which will destroy several mature trees on the front lawn, is also proposed. Foundation testimony at the time of the hearings described traffic flow such that the new guardhouse/ticket booth located just inside the front gate, and built in violation of the Indenture of Trust at an estimated cost of $45,000, will no longer be used for admissions. Drivers will go right past it.
Despite a groundswell of neighborhood objection to the plan, including testimony from dozens of neighbors, the board found that "the operation and modernization of [the Foundation's] facilities would be frustrated by denying the variance to provide parking and [bus] unloading areas on the site." Although the record of the case clearly indicates the dramatic increase in public gallery attendance under the current trustees, from 25,759 in 1985 to 44,481 in the first six months of 1996, remarkably the board found that "This hardship is not self created."
Although it would seem germane to the case, the zoning board refused to consider whether "a primary museum use is being conducted in violation of the zoning ordinance" and ruled that: "If there is to be any significant public access, the public interest is enhanced rather than injured by Barnes' proposal to place parking and bus loading/unloading facilities within the site."
The parking lot approval did come with some conditions, including "a planted landscaped buffer area, to be provided and maintained between the parking lot and adjacent streets." Also, "No tour buses will deliver people to the property for public access to the gallery; people traveling to Barnes by tour bus will be first delivered to an off-site location and from there to Barnes through shuttle buses." The ambiguity in what constitutes a "tour bus" and a "shuttle bus" appears to leave the trustees with a wide berth to do as they please. As of a November 13 zoning hearing, the Foundation has not proceeded with the planning stage, which entails further submittals to the Township. Meanwhile, tour buses continue to deposit and collect their passengers on the street in front of the Gallery.
The zoning board has no jurisdiction to consider the Indenture language that "Donee shall maintain and extend the Joseph Lapsley Wilson Arboretum now existing on said tract of land." and that "All of the buildings and improvements of Donee shall at all times be kept in first class order and repair." The destruction of arboretum grounds in violation of the Indenture is a matter for the Attorney General, or a party with legal standing, of which there are currently none, and will likely go unchallenged. Acting under Attorney General Thomas Corbett, Deputy Attorney General Lawrence Barth's response to the violation of the Indenture's ban on new buildings when the guardhouse/ticket booth went up: "[W]e do not regard this as a serious issue as a structure of such modest size would be necessary to control visitors to the gallery."
In 1994, Nicholas Tinari, the Trustee ad litem for the interest of current and future students, filed a petition to "enjoin proposed construction in violation of the Indenture." (See Barnes Watch 27.) That petition, which went unsupported by then Attorney General Preate, specifically claimed that the Trustees:
Intend to erect parking lots or parking facilities contrary to the Trust Indenture; erect a permanent building known as a guard house or security house in derogation of the Trust Indenture; diminish the size of the arboretum contrary to the Trust Indenture.
Judge Stefan did not even hold a hearing on the matter. He rejected this legitimate attempt to uphold the terms of the Indenture as "frivolous and harassing" and justified his ruling based on a newspaper article on Barnes architect Robert Venturi. This injudicious lapse came from the same judge who once admonished an attorney in the case for using a newspaper as evidence: "You're not going to introduce a newspaper article as a factual basis for anything are you?" [N.T. 11/10/93, p. 127]
Philanthropy in the 90s
The comercialization of the Barnes Foundation is just one example of a trend to exploit charitable institutions for the service of commerce. The Philadelphia Museum of Art marketed the recent Cezanne retrospective with an $800,000 advertising budget which "paid off" in millions in hotel and restaurant revenue hoards of tourists brought to the city. Absent the huge marketing budget the show might have made less money, but visitors may have actually been able to see the works without being herded through galleries like cattle. However, as in the case with the current trusteeship of the Barnes Foundation, the quality of the aesthetic experience was not top on the promoter's minds. Barnes President Richard Glanton, whose livelihood is to attract business clients to his law firm, has become a chamber-of-commerce hero by converting the Barnes Foundation into a full-time tourist/money magnet, while trashing the institution's original purpose to educate students in philosophy and the appreciation of art.
The President of the billion-dollar Pew Charitable Trusts, Rebecca Rimell made a telling comment in a recent Inquirer article. "Arts organizations are going to have to thrive and survive on their merits. They cannot depend on support from the corporate community or in some cases foundations or individuals. Those that are passing the market test are those that are going to be standing tall..." Pew, which once funded a variety of arts organizations without the financial quid-pro-quo, is currently co-funding a $12 million advertising campaign to bring tourists to the area. Having recently axed funding for the Philadelphia Orchestra, it is clear that Pew is now more interested in supporting ventures which will ensure that "tourists come [and] bring money with them."
The original intent of relieving non-profits from the burden of taxation was that they would perform services that would otherwise go unfunded by the corporate sector. Every tax dollar that a Pew Trust or an Annenberg Foundation does not pay must be made up for by the working people who do pay taxes. In return we expect these organizations to add to the quality of life in some way. By employing their untaxed assets as marketing tools -- and that is exactly what the Cezanne exhibit and others like it have become -- "charitable" organizations are aiding for-profit institutions, not just restaurants and hotels, but the underlying financial institutions as well. When non-profits begin acting like for-profits, it is time to question seriously their non-profit status.
This newsletter is published by Barnes Watch, a 501(c)(3) charitable, educational organization. Tax deductible donations, requests for further information, suggestions and correction should be addressed to: Barnes Watch, PO Box 49 Broomall, PA 19008.