Broad Implications

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The story, “An Art Donor Opts to Hold On to His Collection,” reported that 74-year-old Los Angeles financier and philanthropist Eli Broad and his wife, Edythe, had finalized plans for the disposition of the 2,000-plus contemporary artworks in their private collection and held by the 24-year-old Broad Art Foundation. Most of the art world had long assumed that Broad, a major figure in the L.A. community, would donate the majority of the pieces to LACMA, and himself had often stated such intentions. In fact, he had already committed to loaning 220 prime works, including Jeff Koons’s Cracked Egg (Red), 1994–2006, for one year to be displayed in the new LACMA building bearing his name.

But such expectations proved unfounded. According to a statement from Broad, “In the past, when our collections were smaller, we had said that our personal collection and the collection of the Broad Art Foundation would ultimately be given to one or more institutions. As our collections have grown dramatically, our thinking has evolved. We now feel that we can best serve museums by continuing to make accessible a common collection of contemporary art that is shared among many institutions. The foundation will pay for staffing, insurance, storage and conservation of the work.” He adds, however, that LACMA is “our key partner and favored institution in showing [our] works.”

The art world had already been shaken up by federal legislation passed in 2006 that lowered tax incentives for collectors making fractional gifts to museums (see Art+Auction, November 2006). The new rule on deductions doesn’t apply to specifically, since he operates a foundation, but it makes his decision seem more ominous for the future of art giving. Broad’s singular position as a collector with enormous resources has allayed fears to a certain extent. “There aren’t that many collectors out there who can do what Eli Broad is doing,” says Millicent Gaudieri, executive director of the Association of Art Museum Directors, “so I don’t think it’s an epidemic.”

Adding to the consternation caused by the Times article was the “no comment” from Govan, hardly a shrinking violet with the press, especially so close to the opening of the Renzo Piano–designed, 58,000-square-foot BCAM. The director explains that he felt somewhat blindsided by the whole thing: “I had 45 minutes to respond, and I didn’t even know what the hell was going on—I was having lunch with a trustee. So it’s not as if I refused to talk to anybody, but it was like lighting a spark on a dry landscape.” Overall, he thinks the story and other tales of plans are a tempest in a teapot.

“In reality nothing has changed,” insists Govan, whom Broad personally recruited for his present post. “I’ve been having the same conversation with about wanting to leave up a number of masterpieces [from his collection] forever—whatever forever means.” He adds that Broad “seems very committed to this notion of loans, and I’m not uncommitted to it. In fact, thanks to Eli, we have good space to do that.” Govan further points out that, contrary to the perception that the new building Broad has funded is a permanent showcase for his fast- appreciating collection, “it’s our museum, and it’s ours to program from day one.” Supporting that assertion is LACMA’s recent announcement that BCAM’s first-floor galleries are being named after local collectors Jane and Marc Nathanson, who recently donated $10 million to the museum for purchases and shows of contemporary art. Whatever eventually happens with Broad’s vast collection, one thing is certain: He’ll continue to enjoy tax benefits from his finely tuned system of loaning art to museums, rather than gifting it. “It’s a great idea,” says New York art world attorney Ralph Lerner. “It gives him, as the collector and purchaser of the works of art, a greater degree of control, and if it’s done correctly, he can get the exact same tax deduction as given to a public charity.”