After Greitens’ veto, how will KC pay another $48 million for downtown arts campus?

Missouri Gov. Eric Greitens’ veto of legislation to fund half the cost of an ambitious University of Missouri-Kansas City downtown arts campus has raised a giant question.

Now what?

How does Kansas City move forward with a world-class project intended to create the Juilliard of the West?

Just hours before the governor’s veto on June 28, University of Missouri System officials said they weren’t going to rely on state money for the project. The university put out a press release saying they would announce an alternate funding plan in September. But Kansas City political and civic leaders say they have no idea how that Plan B to raise another $48 million will work.

“I think it will be difficult. It’s not going to be a cakewalk,” Mayor Sly James said this week.

He said raising another $48 million is “going to be harder because a lot of people who gave, gave on the condition of the match from the state.… I’m guessing that when you raise $48 million of private money you’ve probably hit all of the people who have the money to make those types of contributions, so where is the next $48 million coming from?”

Warren Erdman, a prominent Kansas City Republican who was a huge advocate for the project and lobbied hard for it with the General Assembly, said he doesn’t know the path forward.

“I’m still optimistic that we’ll find a solution, but the ball is in the court of the university system,” Erdman said in an interview. “I have no idea what the plan will be. I haven’t been and am not involved in that.”

Erdman did say that it’s absolutely crucial for the project to get done, because UMKC’s current conservatory is woefully inadequate and outdated.

The Downtown Campus for the Arts is proposed for an area bounded by 17th and 18th streets and by Broadway and Central Avenue, just south of the Kauffman Center for the Performing Arts.

What’s planned is about 165,000 square feet on four floors, with two state-of-the-art performance spaces and some other flexible spaces. By contrast, the current UMKC Conservatory of Music and Dance is about 54,000 square feet in three cramped buildings, including an old elementary school.

Supporters of the project have said moving the conservatory would bring nearly 700 artistically talented students and young faculty downtown every day, add an artsy vibrancy to the neighborhood, and could create a partnership between the Kauffman Center and the UMKC conservatory, like the one between the Juilliard School and Lincoln Center in New York.

The downtown arts campus is one of the Kansas City Chamber of Commerce’s Big 5 initiatives. The concept, championed by UMKC Chancellor Leo Morton and several Kansas City civic movers and shakers, grew out the 2005 “Time to Get It Right,” report, which forecast that the performing arts was an area of strength at UMKC “where a focused philanthropic investment would pay significant dividends for Kansas City.”

Indeed, UMKC raised half of what it would cost to build the downtown arts campus with the promise from the state that it would supply an equal match. The plan received overwhelming legislative support. But Greitens’ veto took the public dollar match out of the mix.

University officials are not saying how the project can now be accomplished.

“We are trying to determine where and how the plan will be financed,” said Christian Basi, university system spokesman. System and UMKC officials have already started meeting to develop a financing plan.

“But I don’t think it will be a quick decision,” said Basi, who was not able to say whether UMKC alone would need to find the money or if the UM System would help finance the campus.

Chancellor Morton wasn’t available for a comment, and university officials said they had nothing to add to the UM System response.

A statement from UMKC faculty leaders, acquired Friday by The Star, says, “The performing arts in downtown Kansas City have already created a booming economy that has reversed decades of urban blight, boosting the state’s finances and increased tax revenues, property values, service industry spending and tourism dollars. Continuing this trend would increase investment and revenue in the state — which benefits everyone.”

It goes on to say that UMKC faculty will continue to make the case “that this project is worth pursuing for the benefit of our economy, our citizens and our arts faculty and students.”

Compounding the challenge for the university is the UM System’s announcement last month of more than $100 million in cuts, eliminating 474 jobs from its four campuses. System cuts included $15.4 million overall for the Kansas City campus, and the elimination of 51 positions.

The UMKC theater department suffered the loss of four of 18 positions, roughly a $300,000 cut to the department’s budget. Those cuts prompted faculty, students and members of Kansas City’s arts community to launch a citywide campaign, “Save UMKC Theater.”

System officials attributed the cuts to state funding reductions and declining enrollment across the University of Missouri System.

Barbara Bichelmeyer, UMKC provost and executive vice chancellor, said after cuts were announced last month that UMKC was strapped.

“Our state appropriations are such that we are solving for 10 percent of our budget going away. It is going to take more than one year to solve for that,” Bichelmeyer told The Star. “We are trying to solve for a $20 to $30 million campus deficit.”

On Wednesday, during a visit to Kansas City, Greitens panned the arts campus project as a “building for dancers and artists.”

He said it wasn’t a priority for the state and not fair to ask Missouri taxpayers to pony up “more than $75 million — $48 million in debt, $10 million in interest and nearly $19 million over the course of the first 10 years in operating costs.”

In response, Mayor James wrote a blog post that outlines the arts contributions to the state and local economy.

“In 2015, the arts added an astounding 7,515 jobs to our local economy. It also added $7.9 million in revenue to our local government and $10.9 million in revenue to the state government. I don’t hear the Governor saying he doesn’t want the revenue our arts community creates for the state,” James wrote.

While some may think the arts are frills or playgrounds for the elites, James disagreed. In an interview with The Star, the mayor argued that the arts and culture are every bit as important to the state’s economy and to progress as light manufacturing.

He said the city has already agreed to contribute $7 million to the project in land and public infrastructure for the building and that pledge remains in place.

But while he believes the campus is very important, the mayor said the city has many other funding priorities on its list. He didn’t know if the city could increase its funding commitment.

Greitens said he thinks “something like the conservatory is a wonderful priority for UMKC to work on with private philanthropic donors.”

To that end, the university has two things trending in its favor, said Jackie Baker, a spokesperson for Nonprofit Connect, an association that links the nonprofit community to education, resources and networking.

“One thing is increasing support for the arts nationwide,” Baker said, pointing to the latest Giving U.S.A. report that says donor support for the arts was up 6.4 percent in 2016. The only areas where giving showed a greater percentage uptick were the environment and animals.

“You would think that trend would show up locally,” she said, especially since “Kansas City has consistently ranked as one of the top charitable cities in the nation,” ranking ninth among charitable cities. On the 2017 list Kansas City ranked ahead of Chicago, New York and Philadelphia.

Dave Lady, president of the Muriel McBrien Kauffman Foundation, said the university has kept the foundation “in the loop,” and gave foundation officials a heads-up when the funding match shifted from the state to the system.

But the foundation isn’t privy to how the university system intends to raise another $48 million — and whether the intent is for the money to come all from the university or to be a mix of university and private funds. The foundation also is not aware, Lady said, of what other local donors might do to support the project.

Officials with The William T. Kemper Foundation which is among the donors that contributed a million or more to the initial $48 million raised, were not available for comment.

Julia Irene Kauffman pledged $20 million.

“Our perspective is that we were indifferent to where the match comes from, the state or the university system,” Lady said. “What’s important to us is that the project goes forward.” But Lady said there are no plans for the foundation to put additional dollars in the pot for the project.

“We are not prepared to take anything back to our board,” Lady said. “We have made a substantial commitment to the project, and it is not likely that we would be increasing that.”

At the Marion and Henry Bloch Family Foundation, David Miles, the president, said that early on, the foundation had decided it would concentrate its financial support at UMKC in the Henry Bloch School of Management.

“We did explore the potential,” Miles said. “But this is probably not something we would be involved in.”

Andy DiOrio a spokesman for Hallmark, declined to comment “at this time,” on fundraising for the project.

Shirley Helzberg, said she and officials with the Shirley & Barnett Helzberg Foundation — included on the arts campus’s $1 million or more list — have just begun to talk about what can be done to assure the arts campus is built.

“I was so hoping that Gov. Greitens would approve the already approved legislation,” Helzberg said. “ I believe absolutely Kansas City could do it. I just think we have to make this happen. It would benefit the city. But what position we are in on this I can’t tell you at this point. My family, and I think there are many people who understand the importance of having the conservatory downtown.”

While the Greater Kansas City Community Foundation would not comment on the giving climate in Kansas City as it relates to the downtown campus, spokesperson Leanne Breiby said, “The generosity of the Kansas City community never ceases to amaze us at the Greater Kansas City Community Foundation.

“We support donors in giving to their chosen causes, and many have and will continue to support UMKC.”

David Renz, who directs the Midwest Center for Nonprofit Leadership, said he agrees raising that amount “will be a challenge, but I don’t think it is insurmountable. The good news is the resources are here. The test is whether it is considered a high enough priority. Kansas City is blessed with a philanthropic community, and people are generous.”

This story was originally published July 7, 2017 at 4:24 PM with the headline "After Greitens’ veto, how will KC pay another $48 million for downtown arts campus?."