Artists Equity Art Auction Guidelines

PHILA/TRI STATE ARTISTS EQUITY ASSOCIATION, INC.

Fundraising & Art Auction Guidelines

Overview Artists are often asked to participate (donate) their work to raise funds for worthy causes. Artists Equity (AE) has prepared this outline to help artists to make an informed business decision when a request is made of them, by evaluating the pros and cons of participation.

What is the purpose of this guideline? To establish, maintain and promote a fair
partnership between the auction host/fundraiser and artists.

Who is this guideline for? Institutions, businesses, & organizations engaged in fundraising or auctions who utilize artists and their artwork.

GUIDELINES FOR ART AUCTIONS

• The artist sets a minimum bid and reserve price for their work. This allows the artist to protect their galleries and clients. If a work were to sell below market/retail, a client or gallery might ask, “Why should I buy/sell at retail?”
• The price on the artwork should be at retail or higher. Any markdown or “discount” of the retail price is deducted from the fundraiser’s percentage.
• A minimum of 50-90% of the sale should go to the artist. Artists Equity regards requests for donations greater than 50% as an abuse to the artist and an unfair business practice.
• A qualified auctioneer should be hired to insure the best results. The auctioneer should be supplied sufficient background on the artist and the art work to get the best results.
• The work should be displayed and lit to its best advantage.
• The work should be insured and protected from theft or damage.
• An agreement between the host and the artist covering the topics above should be in writing, including insurance in case of theft or damage.

CHECKLIST FOR ARTISTS

Below is a check list for Artists considering auction as an outlet for their work.
Evaluate the opportunity as it relates to your goals as an artist. These guidelines have been prepared to facilitate your decision-making:

How will participation affect my gallery, agent, collectors, and existing market?
Is the audience one who will be willing to pay market value or above market to support the charity or cause?
Will you cover my expenses and not undercut my work?
Will there be a skilled auctioneer?
Will the auctioneer present my work in an informed manner?
Will my work be displayed to its best advantage?
Will a published artists statement or catalogue be available to the audience? A published catalog or artist’s statement can communicate value and quality. Consider supplying your own if one is not available.
What costs of time and resources will I incur? Can you afford the time and costs associated with participation in the event?
What is the level of the other artwork to
be included in the auction? Poor quality artwork may affect the perception of your work.

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ADDITIONAL CONSIDERATIONS

• Organizations are asking collectors to donate artwork instead of artists. Collectors are able to take a full deduction in the U.S., whereas artists are only allowed to deduct the costs of materials. (Artists who donate their own work, for either sale or exhibition, may deduct only the cost of materials.)
• Benefit sales are usually conducted in three ways. (1) The raffle, for which collectors buy a fixed-price ticket and choose an artwork as their names are called. (2) The silent auction, with bidding sheets posted beside each work. (3) Live auction which provides an additional entertainment component.
• In the silent auctions and raffles, a lot of the art goes for well below market value.
You can attach a resale rider to the work. If the work is being sold for $7,000, and then resold for $30,000, the profit should be split between the artist and the original charity. A rider can be stipulated to last for a certain period of time. A rider can also stipulate that the artist or gallery has first refusal rights whenever the work next changes hands.

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Prepared by Karen Kappe Nugent. Reviewed and approved by the board of Phila/Tri State Artists Equity Association, Inc. 2007. Submitted to Artists Equity Membership May 20, 2007. Philadelphia/Tri State Artists Equity Association, Inc.

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(Contributions or gifts to Philadelphia/Tri State Artists Equity Association, Inc.
are not tax deductible as charitable contributions. However, they may be tax deductible
as ordinary and necessary business expenses.)