FY22
Annual
Review

Since declaring diversity in race, gender, sexual orientation, aesthetics, discipline, generation, physical ability and points of view as a core value in 2016, the Foundation has deepened this commitment to embrace inclusion and equity. The Foundation believes the quest for equity is essential for our society and that in this quest the arts have a unique and important role to play.

Since 2016, Jerome Programs have been grounded in community input through convenings, focus groups and open surveys. While Staff is responsible for translating this input into programs and initiatives, applications are reviewed and grantees recommended to the Board for final approval by community panels of artists and arts professionals. Rather than serving as critics or adjudicators, Staff primarily now see their roles as learners, conveners, synthesizers and facilitators.

Even as the grants cited above were made, the Foundation was conscious of its historic under-funding of Minnesota dance organizations. Using the same process of focus groups and surveys that had been used in reimagining the MN Film, Video and Digital Production Program, the Foundation convened multiple groups in FY22 to assess the needs of the MN dance community. Based on their conversations and subsequent survey input, the Board approved a limited RFP for dance and presenting organizations in Minnesota. Specific grants in this initiative totaling $530,136 were subsequently determined in June 2022 and will be reported as part of the FY23 report.

In addition to its own direct grants, the Foundation awarded $1,000,000 in FY21 to two consortium efforts designed to address specific needs faced by BIPOC artists and organizations through the Seeding Cultural Treasures initiative in Minnesota and the Mosaic Project in New York City. The second and final installment of these grants was paid in FY22.

In FY22, the Foundation continued to explore a pilot initiative supporting career transitions at arts organizations, awarding grants both for costs associated with a search for a new leader, and discretionary fund for the new leader once. These by-invitation grants are generally limited to $10,000 for searches and $10,000 for discretionary funds and are available only to organizations with which the Foundation has a significant prior funding history. Two organizations received such grant support in FY22 for a total of $40,000.

The Jerome Foundation Board of Directors is composed of nine Directors, each eligible to serve for up to nine years. Directors generally are chosen based on their commitment to and experience in the arts, their affinity with Foundation values, and their abilities to rise to the higher challenges of governance beyond traditional oversight. The deliberately diverse Board includes representatives of both the Minnesota and New York City arts communities, spanning multiple races, disciplines, generations and points of view.

The Members of the Jerome Corporation are 3-5 individuals who serve a maximum of 15 years, are connected to the Hill family either by interest or by heritage, and are charged both with preserving the legacy of founder Jerome Hill and with electing the Board of Directors.

The Staff includes a program staff, an administrative staff, a finance office and a President, who are collectively charged with day-to-day operations and executing the strategy and directives adopted by the Board.

Additional biographic information about each Director and Staff can also be found on this website.

Administrative expenses totaled $1,084,942 of the charitable budget for the fiscal year, inclusive not only of all rent, salaries, consultant fees, technology etc., but also of all panel and board meeting expenses, panel honoraria and memberships in philanthropic organizations.

These administrative expenses do not include additional non-operating costs of excise taxes, investment fees and timber management, which totaled an additional $352,302. None of these non-operating costs are considered charitable expenses, and all are paid in addition to the 5% distribution.

Total Jerome assets composed of financial investments and a limited timber holding in Oregon decreased in value 10.8% from $127,844,658 on May 1, 2021 to $114,000,996 on April 30, 2022, primarily due to weakened performance in financial markets. In addition, the Foundation had withdrawn and distributed a total of $6,443,245 in charitable and non-charitable payments during the fiscal year.

As this report is being written in early summer 2022, many organizations have only recently undertaken the steps they had hoped to take a year earlier. Postponed commissions are being revived, new employment opportunities are opening, and organizations are scaling up with new and often expanded staffing. In the wake of extraordinary COVID-relief giving from donors, foundations and especially the federal government, many arts organizations now report that they are actually in healthier financial shape than they were before the pandemic began. Audiences are cautiously and slowly beginning to return, even as new COVID variants are appearing.

Looking forward, new questions are likely to confront the arts, including the following:

• With the disappearance of special COVID relief funding, how much longer can this stronger financial health continue?
• How will the decimation of cultural district restaurants, coffee shops and traditional business workspaces affect audience return?
• How will the arts lure the significant percentage of past patrons who are reluctant to return as well as new patrons?
• Might a growing hunger for social experiences and a deeper relevance of arts as a voice for social change attract a public that has never perceived an interest in the arts before?
• With more recent economic volatility and soaring inflation, what will be the impact on consumer discretionary income and on arts organizations’ own investments (for those lucky enough to have them)?
• Will the “great resignation/ exit” continue—a phenomenon that has seen the defection of many from the field and an unprecedented level of turnover?
• Where will the field find its new leaders?
• Is the dramatic increase in foundation and government funding for BIPOC organizations the beginning of a sustained new chapter that will begin to redress the historic inequities of funding or will it be—like many other funder priorities of the past—a momentary phenomenon?
• And how will the arts move beyond representation and programming to larger strategies of promoting greater cultural and racial equity in its organizations and communities?

[1] Members, Directors and Staff are all part of the Jerome Foundation structure but each play different roles. A fuller description of the role of each can be found in the Governance and Staff section later in this report.

[2] While the IRS requires private Foundations to distribute a minimum of 5% of its assets each year, Jerome and many other foundations use a 36-month average of assets to determine their annual distribution. In FY20 the Jerome Foundation committed to overspending this formula by a minimum of $8M in grants over 5 years to help artists and organizations address the stress occasioned by COVID and embrace social change. Recognizing that emergency COVID relief efforts were likely to end long before the arts community had recovered and that a new President, slated to arrive in 2023, might have new priorities that would warrant immediate support, the Foundation has deliberately elected to reserve the majority of this overspending for allocation and distribution in 2023-2025.

[3] 2020 Arts Organization Grants Program, 2021 Jerome Hill Artist Fellowship, 2021 Film, Video and Digital Production (MN & NYC) & Artist Development (MN)

[4] These commitments include specific grants that will be paid in future years but does not include  include the uncommitted balance of the special additional $8M spending or the MN Dance initiative, whose grantees were determined in FY23.