No matter how well qualified someone is to lead a nonprofit arts organization, and no matter how big the group's budget or how broad its reach, the general public seems to assume that people who work in the arts should earn just enough to let them drive an old clunker , live in a residential motel, and buy baked beans to eat from the can. But people sometimes forget that a nonprofit exists to provide a public service or benefit with efficiency, and that requires qualified people who are savvy in both artistic and administrative matters. Such people expect to be adequately — and generously, where possible — paid for their expertise, just as in the for-profit sector. It's the simple principle of enlightened self-interest: you get what you pay for.

But down times are feeding-frenzy time for those who consider the arts to be luxuries, or not important, or things that don't pull their own weight in terms of social responsibility. Politicians are notorious for harping on this one string, apparently not realizing that performers, painters, architects, dancers, writers, and arts education specialists buy groceries, pay mortgages, travel, pay bills, and otherwise contribute to the healthy running of the economic engine. Thus it was only by a political miracle that arts job recovery funds made it into the American Recovery and Reinvestment Act signed into law on Feb. 17. Those funds will be disbursed from the national down to the local level by the National Endowment for the Arts, regional and state arts agencies, and, in some cases, by local arts councils or commissions.

Perhaps those lawmakers noticed Arts and Economic Prosperity III, the 2005-2006 study by the nonprofit group Americans for the Arts. "Nationally, the nonprofit arts and culture industry generates $166.2 billion in economic activity every year — $63.1 billion in spending by organizations and an additional $103.1 billion in event-related spending by their audiences," the report notes. That $166.2 billion generates "5.7 million full-time equivalent jobs; $104.2 billion in household income; $7.9 billion in local government tax revenues; $9.1 billion in state government tax revenues; $12.6 billion in federal income tax revenues."

From a 2004 University of New Mexico Bureau of Business and Economic Research study, we know that arts and culture activities in Santa Fe County generate notable numbers as well — a whopping $1.1. billion annually as of six years ago. That is hardly chopped liver. Support for the arts nonprofits that generate those funds comes from many sources ranging from the National Endowment for the Arts to national, regional, or local donors and foundations. And both New Mexico Arts and the City of Santa Fe Arts Commission make annual awards based on evaluation criteria ranging from artistic quality and impact on tourism to how effectively a group reaches artistically underserved populations and maintains its fiscal health. The charts on page 28 provide a snapshot of recent city and state grants made locally. Only a few grants are especially large, but all are vital to recipients.

Big bucks for big jobs

The salary chart on pages 26, 27, and 28 lists selected top salaried individuals in various local nonprofits. In general, the figures come from the most recent online copies of the Internal Revenue Service's 990 form posted by the nonprofit charity tracker Guide Star (see guidestar.org). Most are for the 2007 fiscal year; a few are for 2006 or 2008. The list comprises mostly arts organizations, plus the College of Santa Fe, Santa Fe Community College, the Institute of American Indian Arts, Santa Fe Institute, and the School for Advanced Research.

Pay rates depend on many things, and "who you know" should never be your only qualification. In general, it looks like local arts nonprofits pay executives based on credible benchmarks: training and experience in the nonprofit sector; understanding of the art form; the organization's budget, longevity, and fiscal health; the state of the organization's strategic plan; the type of identity it wants to project; the region and city where it operates; and its level of artistic ambition. Big-city, big-budget groups generally pay on the high end of the spectrum, while regional or local groups pay less.

Still, there are bound to be exceptions to these unwritten rules. Though a small city in a sparsely populated state, Santa Fe is a capital, houses most of the major state museums, has a number of famed performing-arts groups, attracts many visitors annually, and has many residents with the time and means to support the arts. Those things factor into the money equation.

Nationally, Charity Navigator's 2008 CEO Compensation Study notes that "top leaders" of the 5,324 U.S. charities the organization evaluated earned an average salary of $148,972, compared to $148,477 in the 2005 survey. High as many of those amounts are, they nationally account for only 3.32 percent of an average organization's budget.

If it seems that the smaller organizations give larger salaries — or a larger percentage of the budget — to the CEO or artistic director, consider that that person might be the only full-time staff member and bearing all the work weight. And those who still think someone is making an excessive amount of money might ask themselves: "Would I do it for any less and do as good a job?"

For the record, the three top earners locally were as follows.

1. George King, executive director of the Georgia O'Keeffe Museum, who earned $339,440. This was less than 1 percent (.63) of the organization's gross receipts of $54.167 million, though it was 658 percent of the 2007 Santa Fe County median household income of $51,601, as tallied by the U.S. Census Bureau.

2. Geoffrey West, president of the Santa Fe Institute, earned $320,666. This was 2.74 percent of the organization's gross receipts of $11.72 million and 621 percent of the county's median household income for 2007.

3. Richard Gaddes, former general director of Santa Fe Opera, earned $297,148 — .98 percent of the organization's $30.47 million in gross receipts and 576 percent of the county's 2007 median household income.

New deal for new times

Every nonprofit organization that is not a private foundation must submit an annual report to the IRS using Form 990 or Form 990-EZ. (Private foundations use Form 990-PF.) The 990's formal title is "Return of Organization Exempt From Income Tax." Beginning with the 2008 fiscal year, organizations will file the revised 990, which was modified to reflect changes in the law and the huge growth of the nonprofit sector in the last 30 years.

The new 990 form will require much greater transparency in terms of how top compensation is determined; how the organization defines its key, or most vital, employees; and whether board members had any financial dealings with the organization. Groups will have more space than before to list their projects and successes and explain how their programs and services supported their commitment to benefit the public (performances, conferences, exhibitions, educational events, etc.).

They still have to report such information as organizational gross receipts for the fiscal year; total grants paid; salaries and employee benefits to top executives; and total assets and expenses. And they must provide a full list of officers, directors, trustees, and key employees, and they must divulge how much each is paid. However, organizations do not have to reveal the names of their major donors to the general public in the 990 report.

The Internet has made it simpler for the public to research nonprofits. It used to be that reviewing a 990 report required a trip to the organization's office, and that had to be within a specific time frame: usually within 90 days after the organization notified the public in a newspaper or another publication that the form was available. Alternatively, a researcher could go to the state attorney general's office and inspect the latest filed copy of a 990 and perhaps even photocopy it. It was quite a slog, especially for those who lived far from the state capital.

But these days, virtually all 990s can be found online at the Web sites of three organizations: the Foundation Center (fdncenter.org), GuideStar (guidestar.org), and Charity Navigator (charitynavigator.org). All researchers need to do is set up a user registration on each site, and a universe of nonprofit information will be open to them.

In terms of the timeliness of each report, though, it's important to know that 990 reports are due 90 days after an organization's fiscal year ends. But three-month extensions are routinely granted, usually because an audit is being done. A further extension may be granted in cases of unusual hardship or problems.

Once a 990 is filed, it takes about a month and a half to two months for the IRS to process it. Only then is information sent to the listing organizations mentioned above, usually in large batches comprising thousands of reports. So posting a 990 online can take up to 10 and a half months, counting extensions, after the end of a fiscal year. And with the new reporting requirements just taking effect, many organizations probably will be seeking extensions.

One interesting point about online 990s comes from Dan Moore, vice president for public affairs at GuideStar. A former New Mexico resident, Moore used to oversee charitable organizations in the New Mexico attorney general's office. He noted in an October 2008 online chat session about the new 990 form: "In the beginning, we received a number of questions and complaints from nonprofits about the fact that we had posted their Form 990 on the Internet. Now we get calls and complaints from nonprofits about how long it takes to get their 990 on our site. It's a remarkable change in attitudes and expectations."

Pitching in

While sheer survival is the top concern of most people right now, it's worth remembering that nonprofit organizations are also trying to stay afloat so they can continue serving their communities. More than ever, they are the visible manifestation of our human desire to help, to succor, and to heal, and our collective need to be refreshed, revitalized, and strengthened as we move through life.

People who care about religion, education, arts, social services, health, environment, or other social concerns can help nonprofit organizations that work in these fields by giving whatever they can spare: time, money, or energy. Like earlier crises, this one will pass, but the aftereffects will linger for years. We're going to need our nonprofits to be alive and healthy so they can help us as we pick up the pieces and go on.


Salary figures for people in Santa Fe art nonpprofits