Facing financial issues: Dayton Art Institute still reeling from pandemic

Museum leaders told this newspaper the 2025 operating budget is $4.5 million less than last year.

A deep dive by the Dayton Daily New into the publicly available tax forms filed by the nonprofit shows the museum has reported revenues and expenses to the IRS different than what has been presented to the public in at least two community reports since 2020.

Though the figures included in the community reports indicated the funds listed were unaudited, a 2022 report indicated the operating revenue was $3.3 million more than what was reported in the institute’s 990 tax form.

“We would refer the community to our IRS 990 as the official record of our income and expenses. The community report is unaudited financial data and was prepared by a staff member who is no longer employed by the DAI,” said Mike Griest, director of external affairs for the Dayton Art Institute.

Operating revenues, expenses

Revenues at the Dayton Art Institute have not kept pace with expenses since prior to the pandemic, tax forms show.

The DAI is not alone. Over the past four years, average museum income across the United States has dropped 40%, according to the Washington, D.C.-based American Alliance of Museums.

“The 2025 budget is about $4.5 million dollars less than the 2024 budget. That’s based on ticket sales, income, donations, rising cost of goods, etc.,” Griest said.

For 2018, the total operating revenue was reported as about $6.6 million, while total expenses were at about $5 million. In 2019, the total revenue was $6.3 million and the total expenses were $5.9 million.

In 2020, the first year of the COVID-19 pandemic, the total operating revenue was $4.8 million while operating expenses were just under $6 million, or $5,955,482.

Since then, total operating revenues have wavered between $4.2 million in 2022 and $5.8 million in 2021 and again in 2023.

Operating expenses have only gone up since 2020, according to the tax documents, which show expenses totaling $6.4 million in 2021 and later increasing to $8.6 million in 2023.

In the community reports in 2021 and 2022, certain figures didn’t match some of the listed amounts for revenues and expenses in the Dayton Art Institute’s tax filings.

In 2021, the Dayton Art Institute’s community report posted on its website said its unaudited operating revenue and expenses were both $5.8 million each. While this matches the revenue reported on the tax documents, its total expenses were reported to the IRS as being $6.4 million.

In 2022, the institute’s community report said the unaudited amounts for operating funds and expenses were each $7.6 million. Tax filings show the institute reported its total revenue for that year as being $4.2 million and its expenses totaled nearly $7.9 million.

In the 2023 community report, specific amounts for income and expenses were not included. Pie charts showed a breakdown of the institute’s revenue sources, as well as what the institute’s expenses are.

Top earners’ salary hikes

Salaries for Michael Roediger, director and CEO of the Dayton Art Institute, and Jerry Smith, chief curator, increased by 71% and 93%, respectively, from 2019 to 2023, according to IRS 990 tax forms.

The steepest of the increases took place between 2021 and 2022, according to the tax forms. Roediger’s pay in 2021 was reported as $151,673 in addition to other compensation in the amount of $5,378, which could be bonuses and/or retirement funds. In 2022, Roediger’s pay increased to $234,573 with other compensation in the amount of $10,243.

Smith’s pay in 2021 was $100,616 with other compensation in the amount of $9,573. In 2022, Smith’s salary increased to $182,488 with other compensation in the amount of $37,631.

Credit: Lisa Powell

Credit: Lisa Powell

These increases were due to the institute conducting market research to determine if the pay for Roediger and Smith matched what other similar institutions pay their executives, the museum said.

“In 2021, the DAI looked closely at salaries of many positions, including those of the director and head curator, to positively impact employee retention and talent acquisition. It was determined that many of our salaries were well below market value and needed to be adjusted to remain competitive,” Griest said.

COVID-19 relief funds don’t last

The pandemic and the inflation since has caused major issues for the museum and while it received funding help, it has not been enough.

The Dayton Art Institute received $245,200 from the Ohio Arts Council’s grant distribution of the federal Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, funds for the arts and culture sector.

In November 2020, Roediger said those funds were vital for the museum.

“This is getting us through 2020 and for us, it’s not closing all the way,” Roediger said in 2020. “We have upwards of a $2 million gap. So this is significant, but we still have $900,000 to close in the next month and a half.”

Through the Paycheck Protection Program established by the CARES Act, the Dayton Art Institute also received a $550,000 loan that has since been forgiven, according to the federal Pandemic Response Accountability Committee. That amount went toward payroll.

Endowment funds remain steady

One bright spot for the museum is its endowment has remained steady, according to tax documents, even during years of investment losses.

“It’s our job to make sure that we maintain a balanced budget, that we do a good job of being good stewards of the collection, as well as of the endowment that we manage,” Griest said.

Since 2015, the balance of the endowment that the institute manages has generally stayed between $19.8 million up to the highest of $27.9 million, according to tax documents. In 2023, the most recent year of available data, the end of year balance was $22.4 million.

The largest investment loss between 2015-2023 was about $4.5 million in 2022, which followed the largest gain of $3.7 million in 2021.

In 2023, the total amount of endowment and capital improvement gifts the institute received were immediately reinvested into programming and capital projects, the institute said. This resulted in the net zero contribution to the endowment.

“We remain committed to keeping the museum and its endowment healthy and focused on mission,” Griest said. This is why the institute has made significant cuts to spending in the second half of 2024 and in the 2025 budget plan, he said.

Despite staff reductions, services to continue with little change

In order to accommodate for some of its losses, the institute turned to some staff cuts in the last few months. But the programs, services and fundraising events will continue on with no noticeable difference to patrons, the institute said.

“Just like lots of other organizations in town, we’ve had a decrease in a budgeted expenditure amount for 2025,” Griest said.

About 60% of the institute’s budget goes toward salaries and benefits, Griest said. The financial challenges led the institute to lay off seven employees since July 2024. There has been some internal reorganization to find better efficiencies, he said.

All of institute’s essential positions are currently filled or posted to be refilled, Griest said.

“Everything that we had offered to members and visitors in the past are still available. All of our special exhibitions and regular educational programming, signature events will go on with no noticeable change, and it doesn’t impact the hours available to members and visitors either,” Griest said.

One of the major areas hit was the institute’s largest fundraising event of the year, which suffered last year due to the weather.

Credit: Tom Gilliam

Credit: Tom Gilliam

“Hurricane Helene made Oktoberfest, which is our single largest fundraiser of the year, less profitable than normal,” Griest said. “We had a year that was similar in terms of other donation membership of the things, but the cost of goods and services going up makes it not match. And so some of what we had to do was right-sizing based on what things cost versus what was coming in.”

In 2023, the institute reported the total amount of money received from Oktoberfest ― including both contributions and the gross income and not accounting for the expenses to run the event ― was $664,751. Of that amount, contributions totaled $435,357 and the gross income was $229,394. Combined with the art ball, the gross income and contributions exceeded $1.1 million.

Including both the contributions and income, but accounting for expenses, the combined earnings of both Oktoberfest and the art ball were approximately $490,280 in 2023.

For 2024, the earnings were fewer than $100,000 for Oktoberfest, the institute said.

Special events make up about 7% of the institute’s income, according to the institute’s 2023 community report. The largest sources of income for the institute are general fundraising (39%) and support from invested funds (29%).

Memberships account for 10% of the institute’s income. Museum retail and rentals are 7% of the institute’s income, and the exhibits and education are 8% of its income.

The largest costs for the institute are exhibitions and education (19%), facilities (19%) and administration (16%), according to the 2023 community report. Security accounts for 13% of the expenses, 8% is marketing and 4% is for guest services.

The Dayton Art Institute doesn’t receive any tax revenue, he said, such as from a levy.

“Everything comes from donations, ticket sales and grant funding,” Griest said.

Four years after the pandemic’s start, only half of museums (51%) in the U.S. have recovered to 100% or more of their pre-pandemic attendance levels. This is an improvement from 2023 when only one-third of museums had fully recovered to their pre-pandemic attendance levels, according to the American Alliance of Museums.

Looking forward, 46% of respondents to a American Alliance of Museums survey project their bottom line will increase this year, 17% expect decreases in their bottom line, and 37% expect no change.

Dayton economic development leaders have long said the DAI and other arts organizations in the Dayton area are important to help attract people to live and play in the Dayton area.

“The understanding that people have of quality of life in the community is very heavily dependent on their perception of the richness of the arts and culture scene, even if they never set foot in a concert or a museum. This cannot be overestimated,” Patrick Nugent, president and CEO of the Dayton Performing Arts Alliance, told the Dayton Daily News last year.

“A decade ago, during the Base Realignment and Closure (BRAC) process, Dayton and Wright-Patterson were trying to attract a large number of civilian professionals and employees to come here. As they surveyed them for what they were looking for in terms of quality of life, there were three things. Number one is high quality, affordable housing. Number two was high quality schools. Number three was the rich and vibrant arts and culture scene.”

Credit: Jim Noelker

Credit: Jim Noelker

Upcoming exhibits, events

The Dayton Art Institute’s membership has continued to grow in recent years after experiencing a slight downturn during the pandemic. While the institute went from 4,391 members in 2020 down to 4,142 in 2021, membership is now more than 4,700 people.

Museum attendance has also grown with 63,146 visitors enjoying the art in 2024, the institute recently said. This is up from 53,199 in 2023.

The institute also recently revealed its 2025 exhibits. The upcoming season opens with “Jamie Wyeth: Unsettled” on view from March 15-June 8.