Choosing Our Future: A Continuing Discussion

On Wednesday, February 16, 2000, the full library catalog of the ANS, over 150,000 titles, became part of the vast resources on the worldwide web. Our mission, "to advance the study and public appreciation of coins, medals and related objects" has been dramatically fulfilled in ways our founders could never have imagined.

The internet is also providing a forum for exchange, contentious yet open and hopefully productive, regarding the move to William Street and the difficult decisions regarding staff changes. This forum is particularly important because we failed to communicate properly with our members when these decisions were made. We intend to do so from now on.

Specific issues that have been raised are addressed following this letter. It is my hope that you will respond. Despite having the different agendas, we share a common commitment in wanting the ANS to be vital and strong.

Institutional planning consultants recommended the relocation of the ANS in the early 1990’s. It was determined that the drain on our endowment to meet operating expenses had become chronic over time and would continue because the ANS could not raise necessary funds if we did not move to a more accessible location.

In our present location we are cut off from the public. We are also cut off from our several constituencies, who know we exist yet don’t take sufficient advantage of our resources.

Our exhibit halls do not receive more than 5 visitors per day on weekdays; when they were open on weekends, no more than 10-15 people came. It is not surprising that the membership has remained static for over 30 years, at a time when many membership organizations are thriving.

In addition, we are cut off from the vitality that collaboration with other institutions brings. We are also cut off from the corporate, government and foundation funding that strong programs can attract at a time when we are in financial uncertainty and havebeen told in no uncertain terms that the ANS as it currently functions cannot attract sufficient funding.

Numismatics does not have to be arcane. It is the study of objects that have an immediacy for just about everybody. Yet much of the general public, which supports us through our tax-exempt status, does not even know what the word numismatic means.

Each of us had to be introduced to the field. With an accessible location and compelling exhibition, we can provide that introduction for thousands of others. They, in turn, will become an appreciative and growing audience for the insights that world-class numismatic scholarship provides, and therefore a strong base of support for serious research.

The ANS will continue to be known for its scholarship. Scholarship is essential to this institution, and to me. Public service and the support of scholarship are not antithetical. They have both been part of the ANS since its founding but we must strengthen the relationship between the two. Engaging exhibitions at the new location can be mounted with ANS curatorial expertise in collaboration with experts in exhibition design who can make the story, as well as the scholarship, compelling. What follows are responses to specific questions that have recently been raised about the ANS. I hope that we can resolve our differences in a manner that will ultimately be positive for the future of the American Numismatic Society, and I would appreciate hearing from you.

Recent decisions by the ANS Council and actions taken by the Executive Director were based on a formal planning process and several outside evaluations made over the past seven years.

Inevitably, the several assessments focused on long-standing American Numismatic Society strengths and weaknesses, many of them were interrelated: the strength of collection and ANS scholarly expertise; a distinguished program academic of publications; ambivalence regarding the ANS mission that requires both scholarship and outreach; inaccessible location; lack of public outreach; stagnant membership and increasing deficits despite generous contributions made by the Council and supportive members. (see the letter by Council member Professor Jack Kroll on page 11).

The resulting recommendations were also interrelated: to commit to an accessible location, to increase public outreach, to strengthen professional fundraising staff to work with the director and the Council to fund increased educational programming and endowed curatorial chairs through corporate, foundation and government grants, individual contributions and earned income.

The following statements address specific ANS issues that have been raised by the membership over the past several months:

An essential indicator of the financial health of the Society is the balance between our expenditures and our income. In fiscal year 1998, the last for which audited statements have been made public, expenditures totaled $1.91 million, of which $1.18 million went to salaries.

If that number is taken as the cost for maintaining recent staff levels and services, it can be compared to the Society's income. This is derived from the following four sources:

1. Income from the two Huntington trust funds is $ 55,000 per year. These exist as separate entities that contribute funds to the operating budget of the Society.

2. Income from book sales, photo sales, and member dues has been stagnant for years. It varies with the number of books sold and photographs ordered, but usually income from these sources comes in between $150-200,000 per year.

3.Contributions: The Society has benefited from the extraordinary generosity of its Councilors, who, over the last decade, have donated almost $ 9 million towards a variety of special causes. This amount includes donations by the Harry Bass Research Foundation and by former President Harry Bass for the creation of our collections database and the conversion of the library catalog. Similarly, virtually all computer equipment and related salaries were paid for by the HBRF. President Donald Partrick also supported several initiatives, including COAC, the endowment of a US chair and increased fundraising efforts. Other councilors, such as Kenneth Edlow and Eric Newman have each given in excess of $500,000 to the Society. Leaving these aside, unrestricted annual giving rarely exceeded $100,000.

4. Endowment: Before the building at 140 William Street was purchased, the endowment was c. $17 million (c. $1.3 million of this sum was donated for the new building). The purchase of the building took place in October of 1998 so that approximately three million dollars are owed to the endowment at this time. As a rule of thumb, non-for-profits such as the ANS should draw a sum equal to c. 4-5% of their endowment. Before the purchase of the building this would have been approximately $850,000, a number that includes the yield from that part of the endowment that had been specified for the purchase of a new building. For FY 2000 the figure is around $700,000. The $150,000 that would have been generated by the $3,000,000 tied up in the building is being replaced by donations from council members.

These four sources give a sustainable income of approximately $1.2 million per year. Using the 1998 numbers for expenditure leaves the Society with a running deficit of approximately $700,000. In the absence of any further donations, the only place from which this shortfall can be made up is the endowment. Current market conditions have allowed the Society to do just this but that is a short-sighted solution. As more capital is taken from the endowment, its income will over time decrease, thereby necessitating further withdrawals to cover a growing deficit.

Members should understand that the above numbers are in no way an audited snapshot of the Society's financial condition. They do, however, approximate the numbers that the Council used when reaching the conclusion that cuts were necessary. The extent of these cuts was the subject of sustained discussion. The Council decided that FY2000 expenditures should be cut by only $400,000. This decision was made with the expectation, formed on the basis of professional advice, that moving to William Street would create increased fundraising opportunities as well as operational efficiencies and additional revenue streams. Had the Council ordered that 2000 expenditures be brought strictly into line with expected income from recurring sources, the operational cuts would have been far more drastic.

This is the financial environment that led to early out packages being offered to curators. The cost of these packages is substantial but will only count against the income of the Society for a maximum term of 18 months. The number of curatorial positions supported by unrestricted funds has been reduced from 5 to 2. As the pie charts show, this has been done without substantially changing the percentage of its total spending that the Society devotes to curatorial salaries.

Based on the percentage of salary expenses in the overall budget (see chart below) the Executive Director determined in late November 1999 that budget cuts had to be introduced in Programs Services and the Managmenent and General categories, to use the vocabulary as used in the audits printed in the Annual Report. It included cuts in the administration area (among the seven administrative positions that were lost were the positions of Assistant Director, the office assistant, and five security guards) and two curatorial positions.

The Council decided to offer staff members the option of voluntary early-out packages as a more equitable option than suspending specific individuals. Though it was only necessary for two out of five curators to accept the packages, four opted to accept the offer. Five of seven security guards also took the offer. When the ANS began a search for part-time security replacements, three guards returned on a part-time basis.

The availability of the position of Margaret Thompson Curator of Greek Coins, guaranteed by an endowment of presently $1,700,000, has been announced. Over the past seven years, President Donald Partrick has given generously to the establishment of an endowed United States Coins and Currency Curatorial Chair; the endowment stood on September 30, 1999 at $650,000. In addition, a campaign has been undertaken to endow the Islamic Curatorial Chair. Ideally a curatorial position should be endowed at more than $2 million, estimating earnings of 4% annually ($80,000) which will underwrite salary, employment taxes, health and retirement benefits. It is anticipated that solicitations for funding curatorial chairs will benefit from the move to the new location where potential donors will be able to witness the strengths of ANS programs.

In the short term then the Society will have a curatorial staff of four (Curator of Islamic Coins, Thompson Curator of Greek Coins, Curator of US Coins and Currency, and a Collections Manager). Only two of these positions (Islamic, Collections Manager) are funded from the unrestricted operations fund. Of course, there are one-time expenses associated with these personnel changes, but the budgetary picture of the Society has been improved over the long term.

Public education has been part of the ANS mission since our founders determined to put the word “popularize” in the mission statement when the ANS was founded, an aspect of our mission that for many complex reasons has been largely disregarded. Similarly scholarly museums, such as the American Museum of Natural History have made aggressive investment in their public programs with the result that their scholarly excellence has been assured for years to come. As one commentator put it, the necessity of dealing with the real curiosity of real people was stimulating to all concerned.

The current exhibits at the ANS rarely get more than 5 visitors a day, excluding visitors to the library and coin vaults. The decision to close on weekends was financially motivated as the cost of security outweighed the return of visitors, which was approximately 10-15 on a weekend.

The perception of vitality will also effect membership levels which have remained almost constant since l976. Our current dues are $40, which makes it necessary for the ANS to subsidize membership benefits.

If recent events at the new location are precursors of our future, we should be more than optimistic. The Society has hosted three events in its new location. Lectures on the new EURO currency by Andrew Meadows from the British Museum in November and on Alexander the Great by Iannis Touratsoglou attracted large audiences, major financial support, and a number of new visitors, potential members and donors from the financial community who until these events did not know that the ANS existed. The December 1999 dinner for Arthur Houghton exceeded expectations with almost 200 guests in attendance.

In its new location the ANS will be easily accessible to new audiences. The Federal Reserve Bank, The New York Stock Exchange, The World Trade Center, City Hall, Pace University and South Street Seaport, the Museum of American Financial History and the National Museum of the American Indian are all nearby. The proposed National Womens History Museum and the new Frank Gehry Museum proposed by the Guggenheim will also be in walking distance. Extensive subway service is available at Fulton Street (A, C, J, M, Z, 2, 3, 4 and 5 trains). Downtown bus service is on Broadway and uptown bus service is on Water Street, both nearby. Path service to New Jersey is available at the World Trade Center and ferry service to Staten Island is available at the Battery.

The Society has been advised over time that it must leave its current location for long-term survival. Outreach, part of the ANS mission, is an essential element for receiving funding from tax-exempt foundations, corporations and government institutions.

In late 1993 Pierpont & Wilkerson conducted a feasibility study for a $12 Million capital campaign to fund improvements on the ANS building at Audubon Terrace and strengthen the endowment. They concluded, based on interviews with the ANS constituency, that the ANS could not conduct successful fundraising due to its lack of outreach. The following opinions were expressed by ANS members and its constituency:

"Government was seen as a source of support..only if an extraordinary effort were made ...for acquiring a site to which the ANS could be relocated.” “It is clear that competing institutions have substantial advantages in terms of resources committed to fundraising programs and geographic location.” The “ANS is at a disadvantage in the urgency of its case, its physical location and the limited outreach of its programs."

The location at William Street will have two rental floors which will allow for additional income. We will also have the kind of attractive public spaces, in particular the grand Georgian Hall on the first floor, from which museums and a variety of non-profits derive considerable occasional rental income as well as exposure to prospective members and contributors. A gift/book shop would also generate income.

An entrance charge to the permanent exhibition and special shows would bring much needed money for gallery maintenance. The new location will not only attract but allow for more visitors. The National Museum of the American Indian, which moved from Audubon Terrace four years ago to lower Manhattan (close to the new ANS) formerly averaged 40,000 visitors per year. It now averages 550,000.

After an extensive search to locate an advantageous location in other states and other locations in New York City, the ANS Council purchased the building at 140 William Street in October of 1998. The purchase price, $7,800,000. Funds for the purchase were met by $,4,200,000 borrowed from unrestricted endowment funds of which $1,200,000 has been repaid; $1,300,000 donation from the previous owner, Dr. Ronald Kaplan; and $2,300,000 in donations from Council members and other supporters.

The Society plans to renovate three of the six floors in the first phase and make the whole building available for occupancy. This will allow the ANS to relocate its library, its coin vaults and offices, and have space for public lectures.

A recent cost estimate from the architects is at $5,200,000 for Phase One construction costs, to which various fees for the architects and other consultants have to be added. At present the architects estimate that the total renovation will cost approximately $6,000,000.

The ANS Operations and Management Committee, which overseas the facilities of the Society, is currently working on the construction plans as well as other facets of the move. Peter Res, the Owner’s Representative of the Society, has been working with the Committee to analyze the architects’ plans and establish a precise cost estimate.

President Donald Partrick and the Council are committed to a full funding of Phase One of the renovation project. The initial cost of getting into the new building is the first step of a major building and endowment campaign, in which other sections of the ANS and the Money Museum need to be endowed. Shirley Ferguson Jenks, a fund-raising consultant, has been hired to conduct a fundraising feasibility study for the capital campaign to finance the conference center, the museum and provide much needed funding for the curatorial and library programs. In order to ensure steady cash flow for the renovation and move, the Council Finance Committee and the Executive Director are looking into the financing of this capital project through a low-interest loan from the Industrial Development Agency of New York City. The ANS is presently negotiating with a bank on the exact conditions of the loan. To receive this advantageous loan, a number of criteria must be provided and met: these include the value of 140 William Street, pledges for the project, and the valuation of other assets of the Society.

At its October 23, 1999 meeting the Council discussed the possibility of de-accessioning coins from the collections. It was recognized that the guidelines of the ANS constitution, those of the ANS code of ethics, and those of the American Association of Museums limit any major sale action at this point. The ANS can only sell die-duplicates and those sale proceeds must be used for the purchase of other coins. A sale of items from the collections that would benefit the unrestricted endowment needs permission of the Attorney General of the State of New York. Before any decision can be taken, the ANS must get a better understanding of the current value of its collection, which will also help to assess insurance values. Stephen Lash, Chairman of Christie’s and a Life Associate of the Society, and Anthony Wilson, Director of Spink’s America, had offered to assist the Society in the extensive task of evaluating the ANS collection that contains over 850,000 objects. This offer was made free of charge. Such valuations are common in museums which wish to know the value of their assets: the Hispanic Society of America, the ANS’s neighbor at Audubon Terrace, has asked Christie’s to valuate its coin collections, which have been on a permanent loan to the American Numismatic Society.

Within the academic community the ANS summer seminar is the most recognized program of the ANS. It has educated hundreds of graduate students in numismatics, which has helped to create a better understanding of numismatics as a significant academic discipline. The program, which pays for a dozen graduate students to study numismatics at the ANS for approximately twelve weeks during the summer, is largely funded by an endowed gift from Council member, Eric P. Newman. The endowment for this purpose as of 1998 was at $500,000 which provides a yearly income of approximately $20,000.

The ANS is fully committed to continuing this program. It has been suspended temporarily due to the anticipated move to 140 William Street. The high quality of the Summer Seminar is due to the curatorial staff’s expertise and commitment. Therefore, it is a high priority to improve ANS fundraising in order to create support for curatorial staff and our educational programs. Raising the the student stipend of $2,000 is a particular goal. Presently the financial shortfalls in this program is made up from general operating funds.

We are in the midst of exciting but difficult change. As a result of extensive planning and the advice of numerous ANS members and institutions, recommended changes have been put into place. We are continuing to talk to members as your participation is essential to this process. In the meantime, we would appreciate hearing from you. And we need your help while we regain our footing, rehire our staff, and evolve into a more vital, academically superior organization that has the will and the capacity to move forward with confidence.