Increasing Awareness of the Arts Loan Fund1 Comment
By the end of 2015, the Arts Loan Fund had loaned $18.7 million to 1,345 arts organizations. Their assistance has long helped keep arts non-profits vital during lean financial times and its work stands as a testament to the collaborative power of Bay Area arts grantmakers. It serves as a community resource of which we hope you will remain aware.
The Arts Loan Fund is also an organization that has affected me personally, both as Program Director, the Arts at the Walter & Elise Haas Fund and as an Arts Loan Fund beneficiary — back in its first decade.
In 1989, I served as Executive Director of Intersection for the Arts. At that time, Intersection worked out of a building that wasn’t attached to its foundation. When the Loma Prieta earthquake hit, our building survived but — until its safety and stability could be assessed — we had to temporarily shut our doors.
For arts organizations that depend on ticket revenues, shutting one’s doors even temporarily can be disastrous. Both Intersection for the Arts and Cultural Odyssey, whose performances Intersection was hosting, faced grave hardship.
Then we were offered help. Local funders who had a tradition of working together on the Arts Loan Fund pooled grant funds to help arts organizations affected by the earthquake. Some recipients needed funds to make repairs. Many others were in a situation similar to that faced by Intersection for the Arts. A grant from this quickly and heroically assembled arts relief fund made up for our losses and kept us in operation at a time when attendance and earned revenue had dropped dramatically.
The Arts Loan Fund remains a pooled fund poised to assist arts organizations that face cash flow difficulties, now with loans instead of grants. It offers three primary types of loans:
- Bridge Loans for organizations that have been awarded grants but who must wait for payment – sometimes because the grants are paid on a reimbursement basis;
- Benefit / Performance Loans for organizations that have a track record of presenting financially effective fundraising or other events, but which need up-front cash to produce those events; and
- Quick Qualifier Loans for organizations with modest (up to $10,000) cash flow needs.
Arts nonprofits may be self-conscious about applying to the Arts Loan Fund. Maybe they — or you, and your organization — do not relish the idea of a roomful of funders being made aware of your financial challenges. Now that I am on the grantmaking side, however, I can provide insight into the perspective of funders.
Organizations that keep close tabs on their cash flow and that recognize upcoming shortfalls exhibit good planning. This encourages funders like myself, not the opposite.
Applications to the Arts Loan Fund are accepted regularly and reviewed approximately every six weeks. The interest rate charged on loans is 1% below the prime lending rate — much lower than on any credit card or on a line of credit your organization is unlikely to get from a bank.
The Arts Loan Fund is here to support local arts organizations. If it can help, we encourage you to apply.