Non-Profit Welfare

Back in April, I noted that the Foundry Art Centre in St. Charles exercised “good fiscal planning” by asking the city (which the head of the Foundry’s board referred to as “daddy”) to give the Centre $100,000 to help them meet their budget of $645,000. It seems that this effort paid off, at least to an extent, as seven members of the City Council have advanced legislation that would donate $30,000 to the centre. This payment would be on top of the $2 million of taxpayers’ money that the city has already dedicated to the development of this organization. The city government is also planning to pay up to $10,000 to hire a consulting firm that would “recommend ways to improve the 4-year-old artist studio and exhibition facility’s operations.”

St. Charles has about 63,000 residents. Assuming that the city approves the $30,000 subsidy and the $10,000 consultation fee, it would mean that, on average, the city government has forced local taxpayers to contribute more than $32 for every man, woman, and child in the city in order to subsidize the Foundry’s presence in their community. In the meantime, the Foundry claims to draw more than 90,000 visitors per year, charging an admission fee of $2 per adult and $1 per student or senior citizen. It also hosts events, for which it charges rental and use fees. The rest of its operating budget seems to be drawn from private donations.

To be sure, I am all in favor of the fine arts. But it is exceedingly poor policy for a local government to force taxpayers to support businesses — even non-profit businesses — that otherwise could not support themselves. If an organization’s presence in the community is truly valuable, the market will provide the means for it to sustain itself. If the visitors to the centre are really impressed with what the Foundry has to offer, they should be willing to pay an additional dollar each in order to make sure that the organization can meet its budget.

Similarly, if the 90,000 annual visitors to the Foundry bring additional customers to nearby businesses, the benefited businesses should be willing to make donations that will keep the centre viable. But if the Foundry’s presence isn’t valuable enough to patrons or nearby businesses to warrant an additional dollar in admission price or additional donations, why in the world should taxpayers be forced to pick up the slack?