This report, featuring data and information from Fiscal Year 2011 for the 424 organizations with review complete data in the Michigan Cultural Data Project, presents a view of the health and vitality of the state’s nonprofit cultural sector when Michigan’s economy was at its lowest point since the 1930s, as investment income dropped with the fall in the stock market and the banking crisis. Michigan’s nonprofit arts and cultural community, accustomed to historic cycles of prosperity and decline, faced unprecedented challenges in a new economic reality evidenced by the limitations on working capital to grow and sustain key operations and programs. As Michigan’s economy slowly rebounds and evolves going forward, monitoring working capital trends will continue to be an important measure of the arts and cultural sector’s health and vitality, financial capacity and long-term sustainability.
These 424 organizations face ongoing challenges of maintaining and growing operating capital to sustain their programs and services – maintaining an average operating reserve to support just 66 days of operations in Fiscal Year 2010. Reflecting a positive trend from the Fiscal Year 2009 average of just 9 days of operations, this statistic remains a concern for the long-term sustainability of Michigan’s arts and cultural sector. Working capital is the amount of funds an organization has left after paying its bills or reserving funds to meet obligations. It is a measure of short-term financial capacity and health. Because of the great range in budget sizes of the organizations in the report, the working capital amount was converted to the time it would take to deplete reserves.