Beloved Downtown Arts Group Works/San Jose Faces Eviction

Before his kinetic sculptures captivated visitors at the Guggenheim, Alan Rath showcased his work at a little-known venue called Works/San Jose. Binh Danh got his start at the same community arts nonprofit, displaying his photography before he mastered the ghostly chlorophyll prints that went on to adorn the walls of the De Young.

In the 43 years since its founding, Works has served as a gateway to the city’s art world.

Joe Miller—the San Jose State lecturer and graphic designer who now leads the organization—says his first solo show at Works in 1988 validated his early ambitions.

“It made me understand that there was the possibility of being in some sort of art world,” he says, “that if this was the first step, then there’s some kind of next step I could take. For a lot of people, Works has been that first step.”

Now, the gallery and performing arts space that set so many people on a creative course in life faces a roadblock on its own path—and it couldn’t come at a worse time.

With the pandemic posing an existential threat to arts organizations the world over, Works/San Jose has the additional burden of having to find a new home. After investing $100,000 on new carpeting, wiring and other upgrades in the San Jose Convention Center space from where it’s hosted galleries and spoken word events since 2011, the nonprofit’s board recently found out that Works still has to move by next summer.

“Everything we invested here would be lost,” Miller laments.

Moving would also mean leaving the SoFA arts district, home to MACLA, Anno Domini and the Museum of Quilts and Textiles, as well as Works spinoff San Jose Institute for Contemporary Art. It would mean leaving behind the theaters, murals, art strolls and live music that liven up South First Street in the warmer months—all so Team San Jose could set up a visitor center on an otherwise mostly lifeless stretch of Market Street.

Granted, the current gallery was never meant to be permanent. But Miller says Team San Jose—the city’s tourism bureau, which runs the convention center—led him to believe that it would be much longer term.

In a letter to the community, Miller described the destabilizing effect of physical relocation on an all-volunteer nonprofit with a shoestring budget.

“People throughout our arts community often say that Works is a survivor,” he wrote, “and it has been. However, with this new move, Works will have had to find, fund and build out a completely new site on the average of every six years of its 43-year history. No other local arts organization has survived that frequency and number of upheavals.”

Nine years ago, Works almost went under because of what Miller calls “a completely insane deal” set up by the city’s now-defunct Redevelopment Agency, which offered a few years of subsidized rent for a space on South First before the payments ballooned to $9,000 a month. Unsurprisingly, that arrangement blew up in everyone’s face.

Works went dark for a few months, which would’ve been the end of it until Miller assembled a new board to salvage the wreckage. “We put together a reboot,” he recounts.

Years before voters promoted Sam Liccardo to the mayorship, the fledgling elected helped in his capacity as downtown councilman to move Works into its South Market Street space, which once housed the San Jose Office of Cultural Affairs as well as some other nonprofits, including Teatro Vision and the Mexican Heritage Corporation.

Works/San Jose started off with a five-year lease from the city, which went on to re-up the agreement in three-year increments—until 2018, when Team San Jose broke the news about its planned visitor center.

Raul Peralez, who succeeded Liccardo as District 3 councilman in 2016, says there’s only so much he could do. Certainly, he says, Works/San Jose should get some kind of reimbursement for the money it spent on improving its existing space, but the plans to relocate were long-ago set in motion.

“That’s not really a normal intervention we could take,” he tells San Jose Inside in a phone call from home, where he’s been holed up since the start of the pandemic. “That’s a decision for Team San Jose to make. But I am concerned about the good sum of money Works spent on tenant improvements, and if they’re forced to go, I would like them to get some sort of contribution to make up for that.”

On the bright side—if you could call it that—the coronavirus shutdown bought everyone some time. Originally, Works was told to leave by next month.

“This pandemic has really shifted everything,” Peralez observes. “Pre-pandemic, our convention center was bursting at the seams. We had to turn down events and conventions because we didn’t have the space, and Team San Jose was growing as well. Now, it’s harder to say how things are going to look by next year or whether they’ll even need that space anymore.”

Liccardo, for his part, ignored requests for comment. Miller says he hasn’t heard from the mayor about the impending move either.

Rita Norton, a longtime patron of Works who’s been trying to rally public support to keep the nonprofit in place, says she wishes the city would be more receptive. If San Jose loses Works, she says, it loses a vital part of its creative ecosystem. “The city doesn’t have a very good track record of understanding what we need in downtown,” she says. “And they’re going about this without any transparency and any democratic input.”

In a letter to Peralez expressing her disapproval, Norton cited the Redevelopment Agency’s 2001 ouster of Casa Castillo—a popular Mexican restaurant in the Twohy Building on South First—as an example of the city’s poor judgment.

“This once successful site continues to be under-utilized as a result of this short-sightedness with deep regrets and loss by many who cherish a viable downtown,” Norton told Peralez in a letter shared with his D3 staff. “The decision to evict an arts organization should be taken to a level of transparency and visibility with presentation of pros and cons. As we all look to ‘pivot’ into the future, I respectfully request that your office, the mayor and City Council need to examine ‘the plan’ by the convention center managers and [Team San Jose] on how this space is best utilized.”

Otherwise, Norton remarked in a phone interview earlier this week, San Jose will emerge from the pandemic with the artistic soul of downtown as another casualty.

For an organization as small and cash-strapped as Works, Miller says, it’s scraped by with surprisingly little help compared to counterparts, some of which endure thanks to $1-a-year lease deals from public agencies or lavish endowments from wealthy patrons. For the space at South Market, Works pays $900 a month, which Miller says is “kind of a lot for an arts nonprofit, but still a great deal.”

Without some kind of subsidy or help settling into another public property, Miller doubts Works can survive paying market-rate rent. “If we leave this space, there’s very little possibility that we could be part of SoFA,” he says. “And I think that brings up an important question for the city: Does the arts part of SoFA matter?”

Jennifer Wadsworth is the news editor for San Jose Inside and Metro Silicon Valley. Email tips to [email protected]ews.com. Follow her on Twitter at @jennwadsworth.

23 Comments

  1. Interesting. Team San Jose, the bastard child of The long lost crook Ron Gonzo Gonzo, is bumping the arts. You’ll remember Gonzo began the end of Cinequest when he was ripping the city off with the trash company. Trash – that now gets billed in your property taxes??
    But what’s even funnier is his name is coming up with Davis’ as somehow getting Bart to San Jose.
    We still suffer from that idiot.
    Team San Jose is a 20 million dollar org to promote tourism. But no one shows up.
    Team San Jose is a load of mooches and grifters.

    • yes, Works is a 501c3 nonprofit. that means that there are no ‘owners’ or ‘shareholders’ that receive profits. Works is in the black every year (meaning the organization has a profit in each fiscal year). in our case the people who monetarily profit are people from our community who organize exhibitions, artists who’s work is sold, performers paid to appear, local contractors paid to help, and so on. most all of our participants then spend what they receive in our community.

      • > in our case the people who monetarily profit are people from our community who organize exhibitions, artists who’s work is sold, performers paid to appear, local contractors paid to help, and so on. most all of our participants then spend what they receive in our community.

        Psychobabble.

        Translation: you and your cohorts don’t know how to do double entry bookkeeping.

        Civilization is capitalism.

        Capitalism is double entry bookkeeping.

        • You’re just slinging mud.

          The boss just spelled out how non-profits work.

          “Non-profit” doesn’t mean they are not bringing in income to cover their costs. It means they’re not generating income solely for the benefit of owners or shareholders. After all, Amazon’s expenses cancel out its revenue so that it doesn’t owe taxes and Jeff Bezos is still wealthy. Many “for profit” businesses go bankrupt, such as the Trump casino.

          They have to keep meticulous records to qualify for 501(c)3 status, such as double entry bookkeeping.

          What would worry me is if a community group didn’t qualify as a non-profit, because thus often means they funnel money into people’s pockets that was supposed to support the group’s mission.

          • Having run 2 non-profits as an unpaid volunteer, your claims are not supported by fact. Amazon, like virtually every company with a skilled CFO, minimizes their taxes. Shock news: the tax code is used by individuals, non-profits and for-profits to their advantage.

            “Meticulous record-keeping” – like the soon-to-expire 4C fiasco detailed by SJI is just one of many examples to refute your claim.

            It also points out self-dealing that happens all too often. The landscape is littered with examples. The breast cancer Komen Foundation is one of many. United Way lost their way. Previously a major powerhouse, then the CEO was busted for Concorde jetting to Paris with his mistress multiple times.

            This is *not* a criticism of Works. AFAIK, they are a worthwhile group that merits support – but not public funding.

            Maybe they’d have to bunk outside of the preferred SoFa site to survive or change their business model. It’s completely unrealistic to expect continued feeding at the public trough when SJ just announced the end of the massively popular Viva Calle with more cutbacks to come.

            Also worth noting that Sam Liccardo was able to tap the generosity of the Silicon Valley Foundation (another one that’s earned unfavorable publicity) for about $300K to fund his failed gun control initiative last August.

            Money is available. Excellent leadership is more scarce in the for-profit and non-profit sectors.

          • > What would worry me is if a community group didn’t qualify as a non-profit, because thus often means they funnel money into people’s pockets that was supposed to support the group’s mission.

            My observation of “non-profits” is that they can EASILY be turned into a swindle that benefits gifted story tellers and does little or nothing to benefit their purported cause. (See: “Clinton Foundation”)

            I’ve been around the human race long enough to know that humans have “needs”. Even humans with big hearts and silver tongues have “needs”. And it is the easiest thing in the world for a professional virtue signaller to tell himself or herself that “I’m doing so much good, I deserve a great big salary, benefits package, or retirement pension just like government employees, because I’m doing the work that the lazy government employees won’t do.”

            Every now and then, I check the IRS tax forms filed by “non-profits” so see who’s getting the money, and how much.

            Eye=popping. Big hearted virtue signallers seem to have LOTS and LOTS of needs. Pretty much like your everyday garden variety profit-seeking corporate executive working for a tobacco company.

      • Non profits are in business to provide that which may not be profitable, but provides something of value to the community vis-a-vis the owners. When we are all gone, what is our generation remembered for? Art. Architecture. Music. Buildings. Literature.
        If you want something more quantifiable, think of how much is spent on hotels, restaurants, parking, et cetera to attend cultural events in San Jose, if you don’t see any other value how about the economic impact? Our cultural life is a good investment for cities, corporations, and individuals.

  2. Two of my favorite pieces of art are from Works auctions. I hope they find a new home. They used to be on 3rd near Santa Clara in what is now the WestCA gym.

  3. The pieces details a sad history of imprudent management. Spending $100K on non-recoverable facilities improvements without a lease extension to align with the useful life is …well not very bright. It seems as if the group knew all along that the lease was temporary and alerted again in 2018 that the music would stop – but failed to act.

    We are facing tough choices with our looming deficit. Core services like public safety, streets and parks are more important than the scant number that Works serves.

    Dredging up San Jose’s past poor choices (Casa Castillo, scandal ridden Mexican Heritage Center, the infamous Hayes Mansion financial sinkhole, etc. ) hardly justifies more bungling.

    • A commercial lessee investing in a space is quite normal. A restaurant or brewery, for instance, might invest several hundred thousand dollars, or even more than a million in some downtown businesses, before even opening. While Works’ investment is relatively small, it’s significant for us, which is why we checked with the Chief Operations Officer of our landlord to be sure investments in lighting, electrical, and several safety improvements for visitors could be amortized over several years ahead before spending on them. That is the nature of leasing a space—for profit or a non-profit alike. The uncertainty comes if one’s landlord is not sincere or suddenly changes their mind about your business’ tenancy without warning. It actually can be hard to tell when someone is not telling the truth, or in Works’ case, where our executive contact sincerely thought he knew the truth of what he conveyed.

      • Joe, you cited businesses. You can’t equate a business with a non-profit. You might have gotten my attention if you had compared your non-profit with other art non-profits. Otherwise, you are comparing apples to oranges. I invite you to compare your art non-profit to other SJ non-profit if you want our taxpayer money to fund you instead of fixing the roads or hiring more police officers.

  4. The Works location is great for an art gallery and not so great for a visitor center. A better location for a visitor center would be the end of the Convention Center next to the Lightrail station. It would be visible to people at the Convention Center, the hotels, and the theaters nearby, as well as those taking Lightrail into Downtown San Jose on both the Blue and Green lines. The block of Market Street where Works is located is not in the natural flow of traffic for people visiting San Jose unless they are looking for the SoFA arts district. But it makes a great link from the hotel/convention area to the SoFA district.

    The reason Works is nonprofit is so they can be that first step up the art world ladder, for artists who can’t guarantee sales that justify the cost of operating a for-profit gallery. Their signature is the themed show where visitors can learn from the different interpretations of each artist, which is more culturally interesting than being a showroom for Famous Artists, like the galleries in San Francisco’s gallery district.

  5. There are some odd notions in this thread about the finances of Works/San José. We definitely participate in free market capitalism—we sell things, such as art and tickets to performances, and we then use that revenue to pay for things. The people we pay for services are overwhelmingly residents of San José. As required by law, we account for every dollar of revenue and expenses and report that information to the Franchise Tax Board, the California Secretary of State, and the IRS. On the sale of art, we collect sales tax and pay it to the CDTFA like any other retail business.

    As a nonprofit we accept donations from people who want to support our mission of advancing the careers of local artists. Works also receives grants from the City of San José Office of Cultural Affairs (OCA). OCA funds come exclusively from the Transient Occupancy Tax (the hotel tax). No revenue from taxes or fees on San José residents goes to Works or other arts organizations, which is why there will be little to no OCA funding in the coming year or more. City OCA grants presently make up about 17% of Works’ revenue, so while important to us, certainly not the majority of our funding.

    To be clear, as I have been in interviews with the press, Works is not in financial trouble. With current expenses we should easily survive a few years loss of OCA funds and some other revenue that we expect will decrease. Unless, of course, there is a huge expense like moving and building out a new space at the same time. The unfortunate photo caption in the print version of this article, describing Works as “cash strapped,” did not come from anything I indicated in the interview for this article.

    Recent regional and national studies have shown that the arts are economically a net positive for San José. Local visitors to art exhibitions spend an average of $23 on food, drinks, and such when making that visit. Out of town visitors, such as when we host exhibits in collaboration with international conferences, spend an average of $47 per person around that same single visit to an exhibit or performance. City OCA grants provide less than $1 per visitor to Works, and not a penny of that from San José resident taxpayers.

    • If this article misrepresented your organization in some way, that’s really sad. So let me ask you a question: 1)!What are you wanting and 2) who would pay for it?

  6. why not move Works into the former Family Court House/Bank of California building – the uglyPelli “Brutalist” building some are trying to preserve. a big developer is tearing out the entire City Center Plaza to build giant high rises for a tech company. by leaving the ugly building intact it could be used for Works and as a visitor center.

  7. TAXPAYER, I couldn’t agree more with what you’ve said. I would be interested in seeing the yearly tax records of these non-profits. I’ve seen more non-profits spring up in the last 4 years than ever. Why? Because there’s money to be made by those who run them.

    • Non-profits are required by law to make their financials available for inspection. Don’t be shocked when they (most in my experience ) resist. Important to verify status with the CA Secretary of State for CA based ones – and file complaints when they don’t follow the law.

      Charity Navigator https://www.charitynavigator.org evaluates based on published criteria – not the type – e.g., a sex, drugs, and rock & roll charity could score high marks if properly administered. The site provides links to the IRS 990 filings even for organizations not evaluated because of their size like WORKS SAN JOSE. Works’ 990 can be reviewed at https://990s.foundationcenter.org/990_pdf_archive/942/942525234/942525234_201806_990.pdf

      I have a MBA and looked at WORKS filing after seeing your request. Neither Mr. Miller, nor the BOD is compensated. They are frugally run. WORKS appears to be as squeaky clean as one could hope and exemplary in that regard.

      Compare that to the Red Cross. Tough for me to justify paying their HR head just under $400,000 / year when many of the HR duties are done at the local chapter level. Many of their other C-level compensation looks inflated compared to comparable private sector positions.

      A not-uncommon scam is to have unpaid or marginally paid BOD members / executives that own or have a financial interest in the non-profit’s contractors. Self-dealing, but tough to uncover. Or where lavish benefits are granted like gold-plated travel and living expenses. Then there’s outright fraud as SJI’s reporting revealed for 4Cs.

      • > Neither Mr. Miller, nor the BOD is compensated. They are frugally run. WORKS appears to be as squeaky clean as one could hope and exemplary in that regard.

        Good. I like “squeaky clean”. It’s the best type of non-profit.

        And, I suspect, it’s very hard to do in a world of temptations.

        > Compare that to the Red Cross. Tough for me to justify paying their HR head just under $400,000 / year when many of the HR duties are done at the local chapter level. Many of their other C-level compensation looks inflated compared to comparable private sector positions.

        > A not-uncommon scam is to have unpaid or marginally paid BOD members / executives that own or have a financial interest in the non-profit’s contractors. Self-dealing, but tough to uncover. Or where lavish benefits are granted like gold-plated travel and living expenses. Then there’s outright fraud as SJI’s reporting revealed for 4Cs.

        BINGO!

        Bottom line, if you want to be in a non-profit, expect to have a lot of people looking over your shoulder and having to do a lot of explaining.

        Money is very sticky stuff, and it can stick to a lot of fingers. “Non-profits” are always objects of scrutiny because sometimes people think that no one is looking,

        And if no one is looking, who would miss a few pencils from the office supplies, or a few bucks from the donations box.

  8. WORKS should not need to prove its worth in direct monetary form; it already provides the foundational creative values within the community, without which monetary value could not exist. This is becoming common sense everywhere … except apparently in comment threads.

    San Jose already realizes that arts and culture organizations are an invaluable and irreplaceable driving force for the city’s economy (did you know the Office of Cultural Affairs is a unit of the Office of Economic Development?) The city wants a real arts district because they know in the end it’s good for citizens and for the economy. Inasmuch, they should be helping WORKS, an organization who helps make the arts district possible, and who has somehow made broad, long-lasting positive effects on the city’s cultural scene over many decades, all with a tiny budget. It’s odd that Sam would knowingly ignore this.

    I should note that I was a student of Joe’s for one semester at SJSU some years ago (typography), and that WORKS was the first place I ever sold an artwork (I also happily donated the proceeds). This organization personally helped me to believe in the value of my creative voice to impact others in a positive way. It is highly likely that this story is just one of many thousands.

  9. WORKS reliance on public support accounts for 97% of their operating costs v. 69% for the non-profit Tech Museum. WORKS sales covered about 3% whereas The Tech’s ticket, gift store, etc revenue provided 31% of their revenue.

    It can be argued that the public deems The Tech about 10 times more vital than WORKS – as measured by what they are willing to pay. Filthy lucre is more than just an exchange of goods. It’s a guidepost to what matters. And theft when they aren’t in equilibrium.

    990s don’t detail specific income sources, but safe to assume that WORKS relies heavily on the 10% hotel tax (Transient Occupancy Tax) and the special convention center property tax on hotels with 80 or more units.

    TOT revenue has plummeted. Haven’t seen figures – 90% wouldn’t be surprising since SIP. FY 20/21 looks bleak.

    We’re facing tough choices. Equal percentage cutbacks will hurt some yet prove fatal to others. In my book, far better to pull the plug on those in precarious situations so that more robust ones can survive. These decisions are gut-wrenching as anyone forced to RIF employees to save their companies well understands.

    Which one of my children do I like least when circumstances offer no alternatives? Christmas-In-The-Park, Downtown Ice, Opera SJ, WORKS, etc. are all important and popular cultural offerings. But we won’t be able to fund all of them at previous levels.

    Maybe a shotgun marriage can be arranged to combine WORKS with another art space. Maybe art sales can be combined with lap dances. But unrealistic to assume cultural funding over the next 24 months will be business as usual.

  10. Just move WORKS into the Air Port as no one is using it these days.
    There I’ve solved another problem for you.

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