Return to story

Slavery museum revenue, spending increased in 2007 MUSEUM EXPENSES

November 22, 2008 12:35 am

BY PAMELA GOULD

The U.S. National Slavery Museum raised 50 percent more money in 2007 than in 2006 and ended the year in the black--a reversal from 2006, according to the nonprofit's latest tax return.

However, despite raising $577, 173 and earning $4,567 in interest on its investments, museum expenses for 2007 consumed all but $54,690 of the year's income, the report shows.

Meanwhile, the city revenue commissioner says the museum owes more than $23,000 in overdue real-estate taxes and penalties.

On its tax return, the museum reported an end-of-year balance of $17.6 million, $17.5 million of which was the value of the land the museum was given to build on.

In 2002, the Silver Cos. donated 38 acres within its Celebrate Virginia tourism and retail complex in Fredericksburg for the museum after former Gov. L. Douglas Wilder chose the city as the site for the museum.

The land's value depreciated $9,540 in 2007, according to the report. However, that was offset by unspecified art in the museum's possession, which was valued at $9,000.

Wilder selected Fredericksburg over Jamestown and Richmond as the site for the museum he has envisioned since a visit to Goree Island in West Africa while governor. Wilder finishes his term as mayor of Richmond at year's end.

Dates for the museum to open have repeatedly been pushed back. The most recent estimate came in June 2007, when Executive Director Vonita W. Foster said she hoped for a "soft opening" sometime this year and an official opening in 2009 or 2010.

Foster said at the time that she needed to raise $10 million by fall of 2007 to open a portion of the museum this year. The tax return shows less than $1 million was raised for the entire year.

Construction has not begun nor have city officials received any documents to begin the process of getting approval to start work.

"This is bad times, I know. It's probably bad times to raise money, but I would like to know something," said Building and Development Services Director Stephen Smallwood.

In an odd quirk, a travel story recently appeared in more than one online publication suggesting the museum is open and would make an excellent stop for visitors to the Fredericksburg area.

CITY TAXES OVERDUE

Wilder and Foster have said they had garnered about $50 million in cash and pledges toward constructing a roughly $150 million museum. However, no pledges have ever been listed on the museum's tax returns although there is space to do that.

The only thing standing so far is a garden on the edge of the museum site.

Attempts to speak to Wilder this week were unsuccessful. Foster was not in her office in Central Park during visits there three days this week and once last week.

A public relations firm that had represented the museum said this week that it no longer does so.

In September, the City Council approved Foster's request to extend by one year the deadline to begin construction or restart the permitting process to build a structure taller than is generally allowed at its site.

In October, Commissioner of Revenue Lois B. Jacob denied the museum's request for an exemption from paying real-estate taxes on the land.

That meant the museum owed $21,372.40 on Monday for the first half of its fiscal 2009 real-estate tax bill. It had not been paid as of yesterday, and the museum had accrued $2,136.86 in penalties, according to the city treasurer's office.

In her Oct. 24 letter to museum attorney Charles Payne, Jacob noted that while the slavery museum can be categorized as a nonprofit, Payne provided nothing to show it was operating as a museum or would be doing so in the near future.

"The mere fact that the Taxpayer's name includes the word 'museum,' or that it refers to itself as a museum does not make it a museum," Jacob wrote to Payne.

In making her decision on its tax status, Jacob requested but did not receive documentation that the land would be "developed as a museum in a reasonable time."

She asked for documents showing that construction plans were in place or that finances did not yet allow them.

Without any of that information, she ruled against the museum.

"I received no response to my Aug. 7 and Sept. 11 requests for information that would substantiate the Taxpayer's claim that the property will be developed as a museum within a reasonable amount of time," Jacob wrote. "I would have considered any number of construction or financial documents, including but not limited to a construction contract, project schedule, project budget, and documents establishing the Taxpayer's financial ability to commence construction, but I received no such documentation.

"In fact, I received no reply at all to these requests for information."

THE COST OF FUNDRAISING

The proposed museum's federal tax return is a public document because it is a nonprofit organization. Museum assistant Debra Daniels provided a copy of the return to the newspaper this week, upon request, as provided by law. The deadline for filing the report was Monday.

Of the $527,050 in expenses the museum listed for 2007, the cost of fundraising accounted for $61,910, or 11.7 percent. Of that total, $12,750 was the portion of Foster's $85,000 salary designated toward that effort.

Other expenses for the year included another $66,216 for wages. The museum reported having three employees in 2007.

Expenses fall into three broad categories: fundraising, management and program services.

Program services accounted for $288,331 and included things such as supplies, postage, publications and travel.

Management included salaries, payroll taxes, accounting fees and insurance.

The tax return does not list who gave the $577,173 in contributions to the museum in 2007. However, Philip Morris USA announced in March 2007 that it was making a $200,000 donation.

Pamela Gould: 540/735-1972
Email: pgould@freelancestar.com