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The Business: A Museum in Sleep Mode

Pending better financial times, the Spertus cuts its hours to two and a half days a month.

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The Spertus Institute of Jewish Studies issued some stunning news last week: in response to financial difficulties blamed on the economic downturn, the Spertus—which consists of a college, a museum, and a library—is making operational cuts so drastic they'll practically shut down portions of the glossy, Krueck & Sexton-designed building that opened less than two years ago. As of July 1 the Joyce and Avrum Gray & Family Children's Center will be open only two Sundays per month. And by mid-August the Spertus Museum, which is located on the top two floors of the ten-story building, houses an extensive collection of Judaica, and offers ambitious gallery programming, will have its hours reduced to the same two short Sundays plus a single monthly Thursday evening.

In this nightmare scenario, the Spertus is playing out an institutional version of the national housing crisis. Like those brand-new ghost towns in Nevada and Arizona, the Spertus's acclaimed building will stand mostly unpopulated, its distinctive, faceted glass facade a taunting portal to a locked vault. Treasures and programs that were easily accessible at its former location—a building of the same height, right next door—will now be available to the public a total of about 12 hours a month.

Bottom line: the Spertus can't afford to keep the most public parts of its lush quarters open.

Of course, that's not the official spin. According to the Spertus's newly appointed president Hal M. Lewis (who's been chief operating officer since November), the severely truncated hours are part of a retrenchment that began last fall and is intended to preserve the essence of the institution in all its various aspects until the financial picture improves and growth can begin again. He says the Spertus's endowment lost 22 percent of its value over the last two years, while donations dropped 30 percent in the last year alone. Fiscal 2009 will close with a deficit, but he declined last week to put a number to it.

The cuts—which Lewis says were made with a scalpel, not a hatchet—also include a 26 percent reduction in staff (16 of 60 full-time employees were cut), shorter hours for the Asher Library, and fewer course offerings at the college. A kosher cafe run by Wolfgang Puck was eliminated in March—a move that Lewis expects will save $100,000 annually. In the latest round of layoffs, which took effect this week, casualties included senior curator Staci Boris. Museum director Rhoda Rosen, who weathered a controversy last year that ended with the Spertus caving to pressure and shutting down an exhibit, has survived this as well, though her staff has reportedly been reduced to two people.

Thanks to the surgery, the Spertus has a 2010 operating budget of $5.2 million, 23 percent smaller than for 2009. Lewis says about half of it will be covered by earned income, mostly from tuition at the college, which offers graduate degrees in Jewish studies and nonprofit management. Even so, the roster of courses has been trimmed to focus on core offerings; frills such as out-of-town guest faculty have been largely eliminated. The Spertus's Hebrew and continuing education classes for the general public have been cut by as much as two thirds. In this "challenging economy," Lewis maintains, "the long-term picture will be disastrous if we don't take steps in the short term. Too many not-for-profits, like too many people, have fallen into a habit of living beyond their means. We can't do that, and we can't sit around waiting for things to get better. We need to build a sustainable business model."

The fund-raising campaign for the new building had a goal of $55 million and hasn't yet closed.

The Spertus cuts came just after the Art Institute of Chicago carried out its own latest response to a 23 percent drop in the value of its endowment over the last year (current value: about $640 million). It includes a 3 percent reduction in staff (22 positions), an unpaid weeklong furlough for all employees to be taken by the end of March, and a 50 percent cut in hours for its Ryerson & Burnham Libraries. AIC director James Cuno is throwing in a 10 percent cut in his near-$400,000 salary. Spokesperson Erin Hogan says the aim is to impact the public as little as possible. "We are not shortening hours, we are not putting off exhibitions, we are not canceling any programming," she says.

Bookstores Too

Powell's Bookstores is on its way to reducing its stake in the material world. The Burnham Park store (828 S. Wabash)—an adjunct to the warehouse there—is currently running a 50-percent-off-everything closing sale. It'll disappear by the end of summer, when the company moves warehouse operations to a spot near Midway that won't be open to the public. And the north-side branch building (2850 N. Lincoln), owned by founder Michael Powell—who also owns Powell's Books in Portland, Oregon—has a "for sale" sign on it. Powell's Chicago partner Brad Jonas doesn't think it's likely to go fast in the current market, but the writing's on the wall. He says a recent jump in property taxes turned it from marginally profitable to marginally not.

That will leave the store in Hyde Park (1501 E. 57th), opened in 1970, as the sole local survivor. Jonas says it's the least expensive of the three to operate and rings up the best sales. These days, he estimates, about 35 percent of the Chicago company's business is wholesale, and most of the rest happens online, where business is up "dramatically over the last two years." By contrast, sales at the physical stores have declined consistently for three or four years. "This is a trend not unique to us," Jonas says, noting that out-of-state Internet sales are tax-free. "We love bricks and mortar [but] given the current economic situation, we wanted to consolidate quickly enough so that we didn't lose the whole thing trying to hang on to something that may be changing."

On John Callaway

In the early 1980s the Chicago-Main Newsstand in Evanston was one of the few local places where you could pick up a New York Times. I spotted John Callaway there one wintry Sunday morning, when I was desperate for a journalism job and he had a highly visible one at WTTW. "Do you need any help?" I asked, by way of introducing myself. Trapped, he said he didn't, but that I could send him my clips, which I did. Then I put it out of my mind. Chicago was awash in unemployed journalists, and nobody read clips from strangers, let alone stalker-strangers with minimal experience. But a few weeks later, I got a call from Callaway, who died last week of a heart attack at age 72. He still didn't have a job for me, but he'd read my work, heard about an opening, and wanted to let me know. Nothing in it for him, no agenda, just a rare and striking decency.   

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