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DOCUMENT RESUME
04563 - [B3574842]
The John F. Kennedy Center for the Performinq Arts Is
Financially Troubled. GGD-78-15; b-154459. December 20, 1977. 21
pp. + 4 appendices (10 pp.).
Report to the Congress; by Elmer B. Staats, Comptroller General.
Issue Area- Accountinq, and Financial Reporting (2800).
Contact: General Government Div.
Budget Function: General Government (800).
Organization Concerned: Department of the Treasury; John F.
Kennedy Center foz the Perfo=ming Arts; National Park
Service.
Congressional Relevance: Congxess.
Authority: John F. Kennedy Center Act, as amended (P.L. 94-119;
72 Stat. 1698).
The John F. Kennedy Center for the Ferfcrming Arts
faces serious fibancial problems for which there are no simple
solutions. It is aeavily in debt to the Federal Government and
others and probably cannot meet all of its obligatioLs.
Independent action by either the Secretarv cf the Treasury to
collect the bond interest due or by the Secretary of the
Interior to collect more of the building maintenance costs would
affect the Centerls ability to conduct its performing arts
activities. Only the Congress can make both the value judgments
and the tradeoffs required to resolve the situation.
Findings/Conclusions: The Kennedy Center has nct made provisions
to pay $10.5 million in interest owed on bonds held by the U.S.
Treasury; has not paid its full share of building maintenance
costs; and has not been able to pay all of its operating
expenses when due. The formula developed to allocate maintenavce
costs noeds to be updated because of changes in the Center's
operations. Tke present formula, developed before the Center
opened, calls for the National Park Service to pay 76.2% of
these costs for memorial functions and for the Center to pay
23.8% of the costs for performing functions. While changes have
occurred in the operation of the Center since the development of
the formula, no changes have been made in the cost-sharing
formula, and the Center is not paying its full share of the
maintenance cost. The Center does not believe that additional
private contributions could be raised to pay its debt or that
significant savings could be derived from Pore efficient
operation. It believes that remedial legislation is needed to
achieve an appropriate long-term settlement of its financial
dilemma. (Author/SC)](ViewImageLocal?handle=hein.gao/gaobaawkp0001&div=1&collection=&method=preview&ext=.png&size=3)