How financially healthy is Monroe County science museum WonderLab?

Bloomington science museum WonderLab posted a $452,000 loss in its most recent tax filing, though the organization said the numbers are skewed and the actual loss was much smaller.

The local nonprofit promotes exploration, curiosity and imagination through science exhibits and interactive displays.

Filings with the Internal Revenue Service indicate the local nonprofit, for the fiscal year ending Oct. 31, 2022, had revenue of $968,000, down nearly 50% over the prior year, while expenses, at $1.4 million, rose by nearly 18%.

That resulted in a reported loss of $452,000, the organization’s largest, by far, over the last decade. WonderLab usually generates a slight profit and posted only two other losses since 2011, neither of which exceeded $60,000.

According to the IRS filing, the nonprofit had 52 employees and no volunteers in the year ended Oct. 31, 2022. The museum said in a more recent fact sheet that it has 16 full-time and 10 part-time employees and 216 volunteers.

Sky, stars, sun: Despite clouds, WonderLab uses partial eclipse to teach

Wonderlab also said it has welcomed nearly 1.5 million visitors to its museum, 308 W. Fourth Street, since it was incorporated in 1995, including more than 44,000 in 2022. Its website lists current exhibits on hovercrafts, desert life, a coral reef and more.

Aleisha Kropf, WonderLab marketing and communications director, said the organization actually recorded a much smaller loss than IRS filings show, and that the organization expects to post a small gain or another small loss for the recently concluded fiscal year.

Kropf said answers in her emails should be attributed to her “with input and support from the executive director, Karen Jepson-Innes and representatives from the WonderLab Board Finance Committee."

Kropf said the nonprofit in 2022 received $420,000 from the federal Employee Retention Credit program but auditors placed those funds in the IRS tax year for 2020, instead of 2021. She said that skewed the IRS reports for 2020 and 2021, artificially inflating revenue for one and artificially reducing revenue for the other.

The Employee Retention Credit is a refundable tax credit for businesses and tax-exempt organizations that were affected during the COVID-19 pandemic. WonderLab was closed from March 13 to Aug. 12, 2020, because of the pandemic and said 2021 and 2022 involved a “slow and steady return to pre-pandemic attendance and operations.”

While the most recent IRS report shows a $452,000 loss, Kropf said if the COVID-19-related tax credit had been applied to the proper year, the loss would have been only about $32,000. And the $698,000 gain the organization posted in the prior tax form would have been a gain of only about $278,000.

In its “WonderLab at a Glance” fact sheet, the organization said it posted a slight gain for the year for which the IRS form shows the $452,000 loss, but Kropf said that’s because the sheet covers the calendar year, whereas the IRS form covers the fiscal year, which ends on Oct. 31.

WonderLab’s liabilities in the 2022 tax filings increased to $1.3 million, up more than 50% from the prior year, but Kropf said that’s because the organization paid off its mortgage and upcoming IRS reports won’t show any mortgage liability.

Fiscal year 2022, which ended about six weeks ago, “looks like it is going to be a more normal fiscal year,” Kropf said.

“Overall, the future looks bright financially for the museum,” she said. “However, we are always grateful for community support and are relying on our end of year appeal to bring in much-needed funds to begin year 2024.”

Boris Ladwig can be reached at bladwig@heraldt.com.

This article originally appeared on The Herald-Times: Bloomington science museum WonderLab posts $452K loss. What happened?