Layoffs at the Historical Society have been a long time coming

When the Historical Society of Pennsylvania announced it was laying off 10 employees last week – about 30 percent of its 34 staff members – it did not surprise many in the city’s small world of history organizations and libraries.

Coming less than a year after the Philadelphia History Museum at the Atwater Kent abruptly shut down and announced plans to transfer its huge collection of 130,000 artworks and artifacts to Drexel University, the layoff announcement led many to wonder whether there’s a future for history in the region.

“In the wake of the 2008 recession, we talked a lot about how it would lead to a lot of arts and culture organizations going out of business or merging, which did happen, but slowly,” said Michael J. Barsanti, director of the Library Company of Philadelphia. “One could say that the crises hitting PHM and HSP are just long-delayed aftershocks of that moment.”

But the history museum, which closed last summer, and the historical society, which has struggled and is seeking an affiliation with Drexel University, are very different types of organizations. For one thing, the history museum is a creature of the city, a charter-mandated, quasi-public institution reliant in large part on the vicissitudes of city funding.

Those running the historical society do not find the comparison helpful or apt.

“I do not believe our circumstances are comparable to the Philadelphia History Museum,” said historical society board chair Bruce K. Fenton.

Charles Cullen, the historical society’s interim chief executive, echoed that thought: “We need money, but we’re nowhere near where PHM was.”

The world of small-to-medium-size cultural organizations in general and historical organizations in particular has almost always been in a scramble for dollars. But it is a shock to the system that two relatively high-profile organizations should find themselves in such straits at roughly the same time.

Yet the historical society and the history museum have a long history of trial and tribulation together. In the early 1990s, the financially challenged historical society, at 13th and Locust Streets, proposed creation of a Philadelphia history center that would unite it with what was then known as the Atwater Kent Museum and three other smaller institutions.

It didn’t happen.

The historical society then sought to sell some of its artworks, and in the ensuing uproar, eventually decided to transfer its priceless collection of 10,000 artworks and artifacts – assembled since the historical society’s founding in 1824 – to the Atwater Kent, on South Seventh Street in the first home of the Franklin Institute. The historical society’s future, officials said, would be as a library and archive.

The Atwater Kent then sold off several works of historical society art to pay for its own largely unfunded renovation. The museum closed for three years, and when it reopened in 2012 – construction debt still on the books – it never found a reliable footing or much of an audience.

“There is a big challenge ahead in getting on the road to financial stability,” new museum head Charles Croce said at the time.

It never happened.

Shawn McCaney, executive director of the William Penn Foundation, said the high-profile troubles of the historical society and the history museum are not the whole story for smaller Philadelphia history organizations.

And that is true. The American Philosophical Society boasts an endowment north of $200 million, and as a result enjoys financial stability.

The Library Company of Philadelphia has a much smaller endowment of about $30 million, built up by previous director John van Horne over many years. Van Horne reined in costs and focused on shoring up the endowment. The result is stability.

The Athenaeum of Philadelphia, with an endowment of about $11 million, spent decades building an architectural collection, a growing member base, and new revenue sources. Stability is the result, said Peter Conn, current executive director. (The historical society has an endowment of about $20 million; the Philadelphia History Museum has no endowment.)

Roger Moss, who led the athenaeum for 40 years before retiring in 2008, believes the financial woes of many cultural nonprofits are fairly simple to identify.

“Philadelphians like certain people – or at least give money to them,” he said. “There’s a snobbish quality to Philadelphia.”

And some wounds are self-inflicted. The Civil War Library and Museum of Philadelphia, for instance, teetered on the brink of extinction due to neglect and acrimonious board relationships. No one, snobbish or otherwise, wanted to give money.

But, as McCaney noted, the Civil War museum eventually reached an affiliation with the Gettysburg Foundation – in the interests of keeping the Civil War museum’s collection intact.

And next month, thanks to an agreement with the National Constitution Center, a significant portion of the old Civil War museum’s collection will go on display permanently at the center, the first time the museum’s rare holdings have been on display in Philadelphia since 2008.

The Independence Seaport Museum, McCaney said, which was hit hard by the criminal acts of a former director, has taken a different route to self-preservation. Museum officials are now “expanding their vision of what they are.” They are segueing from history to environmental science, becoming a go-to place for visitors interested in the ecology and natural processes of the Delaware River watershed.

In 2015, William Penn put significant money – about $1.7 million -- into a potential partnership between the Woodmere Art Museum and the Philadelphia History Museum.

In general, McCaney said, foundation officials believe “strategic partnerships are ways for organizations to consolidate and rethink.”

The effort did not gel. Nor did a subsequent partnering effort that involved the history museum and Temple University. Temple left the history museum at the altar in June. The museum closed in the wake of city budget cuts.

William Penn also put $200,000 into the historical society’s strategic plan in 2015. Implementing that plan, which called for expanded programming and a diversified audience, pushed the historical society onto the rocks of a structural deficit amounting to about $400,000 annually on an operating budget of a little over $3 million, according to interim CEO Cullen.

Now, the society has laid off a substantial portion of its staff – cutting into its ambitious programming plans – and is refocusing on its library and archive functions. The society also plans to hire a permanent director.

“We have been caught up in some of the trends that so many other cultural institutions have been caught in over the last 20 years,” board chair Fenton said. “The changing donor base, the proliferation of nonprofit institutions, donor exhaustion, the government pullback from support.”

Those forces led to the adoption of the strategic plan.

Did the historical society consider whether it could sustain itself financially while money was spent on implementing the strategic plan?

“Of course,” he said.

“The quickest and most efficient way to implement the strategic plan was an affiliation with an academic organization,” Fenton said.

Affiliation with an academic institution would bolster the historical society while the whole of the strategic plan was put into effect. Three years ago, the historical society entered into serious talks with Penn. But Penn dropped out. Over the last year and a half, the historical society has been discussing an affiliation with Drexel.

But those talks have gone very slowly. Historical society officials decided they had to make the painful decision to lay off staff members and retrench programming in order to survive and eventually come back. Fenton said the Drexel talks were ongoing.

A spokesperson for Drexel said, “We are conducting extensive due diligence and when that process is complete,” Drexel president John Fry “will make a recommendation to the Drexel board whether or not to move ahead with an affiliation.”

The spokesperson declined comment on the reasons for the slow place of talks. Cullen said Drexel “has known our financial situation from the beginning.”

In the short term, Fenton said the historical society would focus on caring for its collection, fulfilling its functions as a library and archive, and finding a permanent chief executive. An affiliation is still very much in the cards, he said, but the historical society was prepared to go it alone.

Fund-raising has not gone well in recent years, a situation he attributed to the tenuous state of the organization. Several sources outside the historical society argued that the board has not aggressively supported the organization financially. They said the same about the history museum.

Fenton declined to characterize the Penn or Drexel talks and acknowledged the need for a revitalized board.

“I foreclose nothing,” he said. “But we could not keep things running the way they were.”