By Glen Helfand

REMEMBER THE Y2K bug? It's funny how millennium anxieties evaporated rather quickly. The anticipation of that disaster was accompanied by deep fear and quivering, yet the moment played out with an eerie calm. On that dreaded New Year's Eve, most everyone was hunkered down at home, with their nearest and dearest, worried that the lights would go out, that voracious computer viruses would wreak havoc on their precious PCs, and that all infrastructures would collapse. There was something exciting about the uncertainty, but nothing happened.

Some people proclaimed that the true turn of the millennium, in all its mayhem, glitches, meltdowns, and catastrophes, would actually transpire in 2001: the real millennium. Right now, it appears they may have been right, though for reasons deeper than faulty computer code. This was the year when the technology failed to fulfill its promise, when all sorts of systems and infrastructures began to crash – digital, analog, economic, you name it. Portentous notions of disappointment and collapse began to infiltrate everything, including the art world.

In hindsight it seems even more fitting that the year in art opened eagerly, at the stroke of midnight, with the launch of SFMOMA's "010101: Art in Technological Times" Web site – the first big exhibition to focus on the fruits of the digital revolution. It served as a marker of time, of the last days of Internet optimism. The site, which contained commissioned Web projects and interactive dialogues, was an online teaser for the highly anticipated tech show, which debuted in the museum proper a few months later. The trajectory of that show's buildup and fate, like that of the Whitney Museum's analogous "BitStreams" exhibition, seems to mirror the arts in general at our first real experience of the new millennium – the glimmering virtual veneer began to fade. By September it was nearly obliterated.

Like most forms of digital technology, there was something extremely ephemeral about the buzz and the experience of "010101." The narrative seemed to go from the raised expectations of technological possibility to the downward dog of the stock market. The SFMOMA and Whitney shows faded from memory and dialogue, like the Pets.com sock puppet. The project, at least from the current perspective, while groundbreaking, may not serve as one of those seminal events. (The Web site, which had the possibility of being up forever, has since seemingly disappeared.)

The tech boom infused the local landscape with hope and possibility – that new millionaires would become art collectors while luring chic restaurateurs to the area. But as the economy shifted, so did our thoughts about the arts. David Ross, SFMOMA's charismatic, controversial director, abruptly resigned in August under gossip-generating circumstances, leaving the institution rudderless and apparently facing a cash crunch and an identity crisis. All of a sudden the place seemed tainted by scandal (though that hasn't stopped the throngs of tourists from lining up for a more historical flavor of Bay Area art with the current "Ansel Adams at 100" exhibition).

Now most museums, even those in the process of creating high-profile new buildings, are publicly stating their woes. Even the mighty Guggenheim, which is opening spaces in Las Vegas and embarking on a campaign for a massive new Frank Gehry building in Manhattan, handed out pink slips. (Might they be the Enron of the art world?) One worries about the fates of our yet-to-be-built museums – the de Young, the Asian, the Jewish, the Mexican.

Prada canceled plans for its Rem Koolhaas-designed Union Square building, after a hard-won battle with the Planning Commission, because of financial woes. While not art per se, the architect's conceptual chops would have meant something world-class in this town. Right now the canceled plans mean that a lot of Prada's potential young customers are shopping at Target. What a loss!

Though things seem calmer on the grassroots level, we haven't quite recovered from the decimation that the dot-com frenzy wreaked on the local arts community. The artists haven't come back, but there's inspiring vitality to spaces in the Mission, like Pond, the Jack Hanley Gallery, A.O.V., and the impressively ambitious Lizabeth Oliveria Gallery in Oakland – among other underground galleries all around town. The ArtCouncil grants to a dozen S.F. artists also offered signs of hope – support for artists, a strong roster. There's definitely something morale-boosting in the fact that a fair number of Bay Area artists were selected for the forthcoming Whitney Biennial by curator Larry Rinder – a longtime local. (Among them is Margaret Kilgallen, who died of cancer last spring, the same year we saw her on PBS's Art21, with her husband Barry McGee.)

Still, there were some impressive exhibitions – many by Bay Area artists. To my mind, Rebeca Bollinger's September exhibition at Rena Bransten was a knockout. Her show was composed primarily of a mesmerizing DVD projection derived by exploiting an inexplicable feature on her digital camera. The piece used simple gestures and off-the-shelf technologies to generate a real sense of meditative awe. It's the little things and internal structures that matter now.

At Hanley, Chris Johanson (another Biennial includee) reflected the moment with endearingly funky paintings that express the desire to find glimmers of hope in a fucked-up world. "This has something to do with the future" are words he painted on a shit brown background in one of his works. His expressions of uncertainty are oddly assured and mark a step forward for this artist, who definitely seems headed for a next phase of his career.

Curator Ralph Rugoff began to make his presence felt at California College of Arts and Crafts with exhibitions that bore the mark of a man interested in playing with curatorial ideas in an educated, sometimes in a literal way. "Tracking," for example, charted a certain cinematic move, while "The Artist's World" looked at the insular village populated by creative types and called its bluff. Rugoff's exhibitions tap his tony international connections, but the shows themselves, thankfully, are provocative and never fussy.