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new technique should generate some 3,000 new members for the next few years. There are, of course, many variables in this process, but a conservative estimate for FY 1985 would seem to indicate about 16,000 total members and $285,000 of net income from the operation.

Projecting future trends in individual and foundation philanthropy is difficult at best, with both depending heavily on the state of the U.S. and world economy. However, corporate support of art and culture has been growing over recent years. The Development Office has been involved with gifts and grants to the Institution and its many organizations of approximately $2,000,000 per year. Assuming economic recovery in FY 1980 and a continued period of healthy growth through FY 1985, prospects for increased private support of the Institution seem favorable. The Quadrangle project will receive the lion's share of the Institution's fund-raising efforts, but attention will continue to be given to the needs of the various museums and galleries.

[[underlined]] Smithsonian Magazine [[/underlined]]. Although the Magazine's management is justifiably cautious about the ebb and flow of fashion in publishing, it also expects that the demand for its products will remain strong, with an annual financial surplus estimated at $5,000,000 to $6,000,000 over the next few years, which can continue to support research, education, and collections, as well as provide growth in reserves of the Smithsonian. The Magazine will continue to produce a high quality product and to be supported entirely by the trust revenues which it generates. Net growth in subscribers is expected to range from 35,000 to 50,000 a year from the present level of about 1,750,000. Due to inflationary cost increases associated with production and mailing, subscription rates may increase in late FY 1980.

[[underlined]] Business Management Activities [[/underlined]]. Both the scope and the public's acceptance of the auxiliary activities have increased over the past several years, but it remains to be seen if these trends continue. New educational products relevant to the Smithsonian's museum shops and mail order operations will continue to be introduced. While mail order revenues for FY 1979 and FY 1980 are expected to be somewhat less than the costs of operations, beginning in FY 1981 some net surplus should be realized. Improvements will be made in marketing systems and automated order processing. With concessions and museum shops income directly related to visitation, net revenues from these operations should remain strong over the planning period.

During FY 1979, the Institution considered alternative uses for the Belmont Conference Center and decided to maintain this installation as it is currently operated. Even though the Center operates close to capacity, it incurs a slight loss due to the limited size of the facility.