The Alaska Native Arts Foundation began with high hopes for helping out struggling rural villages by providing markets where Native artists could sell their work.
Little of the millions spent passed down to the villages, however, and now even that is in jeopardy following state budget cuts.
"It's going to have a deep impact," said Barbara Apangalook, a Siberian Yupik/Tlingit artist who has sold work through the foundation's programs, including a Native arts gallery in Anchorage and its extensive Internet site.
"If these funds are cut, it could be almost disastrous for a lot of Native artists, she said. Apangalook is a native of the St. Lawrence Island community of Gambell, though her mother was from Yakutat. She now lives in Wasilla.
Even before the budget cuts, the foundation was facing trouble. An Empire review of its tax documents shows little of the millions in public money spent on the program passed on to the artists.
The foundation's strategy was to buy the work of Native artists, and then resell it, providing the artists with needed money up front. The foundation has been struggling to sell the art it has been buying, and each year has wound up with more and more art in its inventory.
"We've been stockpiling some art," acknowledged Perry Eaton, an artist and former Alyeska Pipeline Service Co. spokesman who is now co-chairman of the foundation's board of directors.
The idea for the foundation came from former chair Alice Rogoff, who lives on the East Coast, but has a house in Anchorage and a long-standing interest in Alaska Native art.
On an aerial tour of Alaska with Theron Smith, former chief pilot of Alaska Airlines, and his wife Terry Ellis-Smith, they decided to create the foundation to bring new marketing and retail resources to Alaska.
Ellis-Smith, of the Ketchikan's Ellis Airlines family, and Rogoff joined the foundation's board of directors. Pheron Smith was killed recently, piloting the plane in which Sen. Ted Stevens and others also died in western Alaska.
A separate, but related venture, Alaska House New York, which attempted to sell Native art in a New York City gallery, recently closed.
Rogoff declined comment to the Empire, but told of the foundation's beginnings during a legislative hearing seeking additional funding.
Eaton said it has not yet been determined what the result of the budget cuts will be. The gallery and the Internet site are the foundation's biggest expenses, but they will soon be nearly its only source of revenue.
As of Sept. 30, the foundation's funding from the state and federally funded Alaska Manufacturing Extension Partnership will end, the partnership said recently.
"We have no immediate source of funds to make up the shortfall," Eaton said.
Rogoff told the legislature last year the foundation had so far purchased $1 million in Native art, with the manufacturing funds covering the foundation's core overhead.
The foundation's most recently available tax returns show that while it may have purchased that much art, it has been unable to sell anywhere near that amount.
At the end of 2008, the foundation reported having $625,000 in inventory in stock, a number that's grown in each of the last three years.
Eaton acknowledged that even without the budget cuts, the foundation would be cutting its purchases of Native art.
"If we have the funds, of course we buy," he said, but "that will clearly slow down."
The foundation reported sales of between $196,000 and $225,000 each of the last three years, for a total revenue of $642,000.
It also reported its "cost of goods sold" during that period of $321,000, showing that about half that amount went to Native artists.
During the last several years the Alaska Native Arts Foundation has received about $600,000 a year in public subsidies, for a total of nearly $3 million.
Without that money, Eaton said the board has not yet decided what it will do.
"That will take a large chunk out," he said. "We're like very other non-profit in the state, scrambling like anything."
• Contact Pat Forgey at 5823-2250 or email@example.com.