Springsteen shortfall leads to budget and staff cuts at Constitution Center

National Constitution Center president and CEO David Eisner had already announced his departure.
National Constitution Center president and CEO David Eisner had already announced his departure. (AKIRA SUWA / Staff Photographer)
Posted: September 27, 2012

Looking forward to a year festooned with a potential blockbuster Bruce Springsteen exhibit, the 225th anniversary of the Constitutional Convention, plus the launch of its biggest self-curated exhibition ever, the National Constitution Center had every reason to be optimistic going into 2012.

But the Boss didn't deliver.

Springsteen-driven revenue fell far short of budgeted projections, fueling a deficit and forcing the center to implement a major cost-cutting course correction.

An austere 2013 budget has been proposed that calls for eliminating 17 staff positions, about 10 percent of the center's jobs, according to budget documents and interviews with center staff members. (Some positions are already vacant.)

Programming and advertising costs for 2013 will be reduced by roughly $2.5 million to around $3.5 million. Forecast budget expenditures will be about $13.8 million in 2013, compared with current internal projections of $18.4 million for 2012.

At their regular quarterly board meeting Sept. 13, trustees, who must approve the budget, learned that the center is now projecting a $3.9 million gap between budgeted revenues and expenses for 2012.

Some of that gap represents money that was penciled in but never materialized, not necessarily money spent. For example, the center hoped for $1 million from the Jim Beam Distillery in support of its exhibition "American Spirits: The Rise and Fall of Prohibition," debuting Oct. 19. The Beam contribution fell through, but the $1 million still contributes to the projected budget gap.

Some of the gap is also due to accidents of timing - money spent on efforts that might pay off, and grants and contributions delayed for one reason or another.

A $4 million line of short-term credit - to help with cash flow - has been opened with Citizens Bank, and belts are tightening all around.

Nevertheless, departing president and chief executive David Eisner says the center, on the northernmost block of Independence Mall, will end the year with no operating deficit. Eisner announced in August that he would leave the NCC, after nearly three years in the job, at the end of October.

"Operating, we were in the black [in 2011], and we'll end up that way this year," Eisner said in a recent interview.

The 2011 numbers were given a boost by a year-end contribution of about $1 million from Doug DeVos, chairman of the trustees' executive committee, according to a number of sources.

A DeVos spokesman said "the DeVos family certainly has a long history with the Constitution Center and they have a giving history and a giving relationship . . . and they have a plan." He would not discuss a specific gift.

Will contributed income prove the NCC's savior this year as well? "Always," Eisner said. "Contributed income is a big piece of our annual operating support."

That said, budget documents obtained by The Inquirer indicate that 2012 contributed support is down in almost all categories - with the major exception of board support.

At the end of July, contributions totaled $4.3 million, compared with $6 million last year and a $4.6 million three-year average. Individual, corporate, foundation, and government support are down for the year so far. However, board support of about $2.3 million in 2012 represents a nearly 15 percent increase over projections.

Another set of budget documents shows somewhat contradictory numbers, with private support pegged at $3.8 million as of July, $69,000 above budget and 15 percent ahead of last year.

Both sets of documents suggest that the board has stepped into the fiscal breach.

Eisner characterized overall private contributions as "slightly up" over 2011, with 2011 "slightly up" over 2010.

"Nobody is really pleased with where we are on attendance," he said of the underperformance of the Springsteen exhibit, "From Asbury Park to the Promised Land," which ran from Feb. 17 to Sept. 3. "We have to grow it."

"We do have budget pressure," he continued. "But overall, from a financial perspective, we're trending in the right direction."

He declined to discuss the specifics of Springsteen attendance or revenues, saying only that "Asbury Park" was one of the center's top three all-time exhibition draws, along with "Diana: A Celebration," a fashion-centric homage to the late princess, and "America I Am," a look at black history and culture put together by the talk-show host and writer Tavis Smiley.

("Diana" drew about 78,000 visitors, according to internal center documents; the average special exhibition has drawn about 46,000 visitors.)

Springsteen underperformed projections by 23 percent, however, putting the brakes on a host of center plans and operations.

DeVos, the center's executive chair, said he did not believe that the organization, which began operations in 2003 and now has an endowment of about $45 million, is suffering from any kind of chronic or structural deficit.

"We're a young organization," he said. "We're getting a good idea of what exhibitions will bring more visitors. Our budget and planning process we're continuing to refine. Sometimes you end up a little behind. This [shortfall] doesn't speak to a fundamental situation with the organization, in my opinion."

He characterized the reining in of the 2013 budget and efforts to economize as "tactical adjustments."

DeVos also noted "tremendous support" for this year's Liberty Medal award, bestowed on Muhammad Ali at ceremonies Thursday. Fund-raising for the award topped $1.4 million, according to center documents, exceeding the $1.3 million goal.

Both DeVos and Eisner emphasized that the center needed to build the visibility of its permanent and special museum exhibitions; build awareness of the center as a forum for public dialogue and exchange; and operate as an educational platform, working with schools and institutions of higher learning.

"We need to be stewards for that mission," DeVos said.

He and Eisner support the center's push into curating and touring its own exhibitions. The first such effort, "American Spirits," will tour to seven other cities (at $150,000 a stop) after Philadelphia, and talks are under way for an eighth venue.

"It will be producing revenue into 2016," said Eisner.

Outside the center, however, the image of the institution is blurred, according to various Philadelphia officials and cultural leaders, partially because of the center's ambitious - and abstract - agenda and partially because of a turnover in leadership. Eisner is the third chief executive, and a search is under way for the fourth.

"The question of consistent leadership is not a story the NCC could tell," said Meryl Levitz, president and chief executive of the Greater Philadelphia Tourism Marketing Corp. "There have been a series of temporary leaders."

Eisner took exception to that view. "I don't believe that when I came here I changed anything about where we're going," he said.

"Working with the board on the new CEO search, I don't see that there's going to be a sort of left-hand/right-hand turn."


Contact Stephan Salisbury at 215-854-5594, ssalisbury@phillynews.com, or @SPSalisbury on Twitter

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