Without a doubt, these painful changes will significantly impact the ability of many arts organizations to sustain themselves. There is also no doubt in my mind that while “the wealthy” are the likely go-to-first to fill the gap of support, it is going to take both public and private support (with admittedly a much greater emphasis on private) for the arts to ensure the arts can remain vibrant contributors to society at large.
The very fact that the US is in such financial peril makes it all that more compelling and imperative that state arts agencies provide training programs for arts leaders to re-frame their organizations missions to have BOTH a “do good” and “do well” component. This will require a shift in mindset to create a TRUE FOR PROFIT piece to their work so that they can, through establishing self-sufficiency, support at least a sizable portion of their not-for-profit endeavors. These new business segments will need to be set up as separate legal entities too and be constructed carefully to not threaten the status of their 501c3 designation. (But more on this for another post)
Personally, from having come from the for-profit-arts-world, and despite entering the not-for-profit world in an incredibly interesting and challenging time, my business plan for The Institute for Arts Entrepreneurship, a 501c3, has always included being sustained, in large part, by a for-profit business. This is the model I believe all arts organizations and artists need to adopt on some level. And, indeed, Lisa’s Clarinet Shop, a for-profit business, has supported The IAE. The IAE was entirely conceived, developed and created with funding through a for-profit business that in no way has or will threaten the validity of our 501c3 status.
However, my plan for the future is to have the IAE be supported more substantially through another for-profit business that is in the process of being launched now. This business will be through Entrepreneur The Arts. ETA will provide a bridge to connect artists to business, education and government through training programs that help others access the core disciplines and tools of the artistic mind and our work. These training programs will help increase corporate creativity, help drive innovation, serve as safe spaces to bridge ingenuity gaps and work on low levels of diplomacy and national security. If you look carefully at The ETA website, you will see the deep root of this vision has been in place for some time. However, to truly execute it required more than John Cimino, Creative Leaps International, and myself to do the work. ETA needed a 501c3 like The IAE, to train artists and refer them to us to help us do our work.
You see, dear artists, WE MUST exchange ideas and share our gifts with the world in meaningful RELEVANT ways. Our survival has been threatened because we, by and large, have NOT been able to communicate or demonstrate that our gifts can make the difference we seek for them to make. And to demonstrate they can, we must learn how to interpret, communicate and render our work in ways that those who have the financial capacity and motivation to use our knowledge CAN.
I have a tremendous passion for seeing the arts take a much more valuable role–center stage for the world to benefit– because most artists I know have the capacity, but not the skills, to make the difference they seek. But to be the difference we seek, we must play by the world’s rules. And the game right now is Survival of the Fittest. The winners of the game will have developed the entrepreneurial skills they need – their protective armor- to ensure they can survive forever.
Written By Tom Jacobs
State arts agencies, which provide vital funding and assistance to nonprofit arts institutions, are threatened with extinction across the U.S.
The Arizona Commission on the Arts recently inaugurated a campaign to raise awareness about the importance of arts education. Fittingly, it features imagery that is imaginative, provocative and disturbing, including a paint brush that morphs into the type of needles junkies use to shoot up. The caption is concise and compelling: “Kids will leave their mark, with or without the arts.”
Artists, too, will leave their mark, with or without governmental support. They’ve been sketching, dancing and making music for thousands of years, and they’re not going to stop if — as governors around the United States are currently proposing — state arts agencies are either drastically curtailed or completely dismantled.
But advocacy campaigns like the one mentioned above? They’ll likely be a thing of the past. Student matinees, training programs for teachers and administrators, efforts to bring cultural events into inner cities and rural communities — all will be severely curtailed.
Wealthy patrons will still enjoy the cultural offerings they generously support. But less-glamorous projects, and those that require coordination or cooperation between organizations, will be fewer in number and lower in quality. And smaller organizations, which rely more heavily on public support, will be more likely to close their doors.
“It’s a basic idea of our democratic society that if something is really beneficial to people, we should do our best to give everybody access to it,” said Ken May, executive director of the South Carolina Arts Commission. “That’s the reasoning behind public education, public parks, public libraries, and public support for the arts.”
State arts agencies don’t attract the attention — positive or negative — of the National Endowment for the Arts, which is once again being threatened by congressional cutbacks, but they play an underappreciated role in the nation’s arts infrastructure. Funded by a mixture of state appropriations, matching grants from the National Endowment for the Arts and some private support, these agencies provide nonprofit arts organizations with advice, guidance, information — and grant money.
“Direct support for the arts at the state level is now — and has been for some time — a more important source of direct government aid to the arts than is direct support at the federal level,” J. Mark Shuster wrote in a 2003 report published by the Cultural Policy Center of the University of Chicago. NEA grants may be larger and more prestigious, but they’re also fewer and harder to get. State support, including both money and expertise, makes a bigger day-to-day difference.
In the half century or more they’ve been in existence (most were created as conduits to receive and administer federal arts money shortly after the NEA was founded in 1965), state arts agencies have seen their appropriations grow and shrink. State budgets inevitably reflect the ups and downs of tax revenues, and during down years, the arts get hurt along with everyone else.
California famously cut its arts commission budget from $38 million to just over $1 million during a budget crisis a decade ago; it is only now inching back, thanks in part to a license-plates-for-the-arts program promoted by former governor (and actor) Arnold Schwarzenegger. Many states have cut arts funding drastically over the past two years, as tax revenues have shrunk in the current recession: 60 percent in Arizona, 50 percent in Kansas, 48 percent in Washington state, for example.
Overall, state arts agencies have seen a 19 percent cut in funding from their legislatures since the start of the recession in 2008. According to a just-released report by the National Assembly of State Arts Agencies, they received a combined total of $272 million in state appropriations for fiscal year 2011. That amounts to 0.039 percent of state general fund expenditures, or 87 cents per capita on average.
Fiscally speaking, that’s small change, and arts agencies argue they provide a lot of bang — or, better, beauty — for the buck. But this year’s combination of dire fiscal conditions and newly elected, small-government-oriented politicians has left some commissions facing an existential threat. In at least four states — Texas, Kansas, Washington and South Carolina — the governor recently proposed an unprecedented action: eliminating the state arts agency entirely.
In Kansas, the administration’s proposal calls for the Arts Commission to transition into a private nonprofit organization. In Texas, the governor’s budget simply eliminates state funding for the Commission on the Arts.
In Arizona, the commission would lose all its money from the state’s general revenue fund. In Washington state, it would be shrunk dramatically and merged into the Commerce Department, its level of independence uncertain.
“So many things are affected by our small investments,” said Kris Tucker, executive director of the Washington State Arts Commission. “To not have arts education programs in the schools, free concerts in the parks, training for arts managers — all that will have an impact on our communities.”
She readily concedes that Washington state’s budget problems “are huge. They’re talking about eliminating basic health and dental care for children. Our million dollars is not going to make a big difference. But then, for $1 million, you can buy a lot of prenatal care.”
On the other hand, few states would want to lose federal funding at a time when dollars are scarce — which would be the result of the total-elimination scenarios. According to NEA bylaws, its funds are only distributed to the states through designated state agencies. In Kansas, for example, while eliminating the state agency would save $575,000, it would no longer qualify for federal matching funds of $1.2 million.
Ditto South Carolina. In her first State of the State address in January, newly elected South Carolina Gov. Nikki Haley singled out two agencies for elimination: South Carolina Educational Television, and the state’s Arts Commission. The arts agency’s $2 million state appropriation this year represents “about four-one-hundredths of 1 percent of the state budget,” noted May. In exchange, the state would lose around $1 million in federal arts support.
Perhaps surprisingly, May believes Haley’s high-profile announcement was not entirely a bad thing.
“It may be she did us a favor,” he said. “We’ve known this would be a very difficult budget session. The state has an $850 million hole in its budget, and everybody knows a lot of cutting will go on. But this has made it a different cause. Cuts are one thing — elimination is another.
“We’ve had news coverage all over the state — it was on the front pages of the papers — and it has really rallied the troops. Because the battle is about elimination rather than cuts, it lets us make the case for why the state should provide some funding for the arts.”
That same battle is just getting underway in Texas, where Gov. Rick Perry proposed cutting the arts agency’s entire $5 million appropriation. “We are a bit unclear on the details of the governor’s budget proposal,” said Gaye Greever McElwain, director of marketing and communications for the
Texas Commission on the Arts. “However, it appears we would not be able to continue operations.”
McElwain noted this is one step in a long process. The Texas state House and Senate have their own budget proposals on the table, and while they include massive cuts for the agency — a 50 percent budget cut, 30 percent staff cut and elimination of funding for advertising, promotion and cultural tourism — the agency would still exist and remain eligible for $1 million in NEA matching funds.
“We simply do not know what the final resolution will be,” McElwain said. “We will continue to work with the legislature [to explain why we deserve funding].”
“State arts agencies really like to explain what they do, why they exist and what happens as the result of their work,” noted Jonathan Katz, CEO of the National Assembly of State Arts Agencies. “In this economic environment, we expect people to question the benefits of public support for the arts. Happily, there is really good evidence of what those benefits are.”
So what do they do?
“Our mission is to provide opportunities for the people of Kansas to experience the arts,” said Llewellyn Crain, director of the Kansas Arts Commission. “We have become expert in communications tools. We create a weekly e-blast: ‘This is stuff you need to know about,’ including funding opportunities and other information. We also do monthly e-blasts to artists and arts educators.
“We’re focused on helping artists and arts organizations understand they are part of a business community, and they need to understand business operating principles,” she added. “A nonprofit is a much more complicated business model than a for-profit business. You have to have a board. You have several different income streams. We try to help them navigate all that.”
“We have a very strong record of bringing the arts to places where they haven’t been so much before and in improving the basic curriculum for arts in the schools,” added South Carolina’s May. “We’ve gained national attention for that. That’s the kind of thing that nobody else is going to do other than a state agency that is looking strategically at important issues related to the arts.”
Couldn’t a private nonprofit organization do much of that work?
“In theory, absolutely,” said Crain. “In practical terms, it’d be very difficult. A private nonprofit would have to raise funds for its own operations. We’d be competing with our own constituents for a fairly small pool of money. There are wealthy people here who support the arts in their own communities, but what would be the compelling reason to support us?”
That raises an important point. When state arts agencies distribute grant money (some of it from state funds, the rest from the NEA), it is often for the sort of nuts-and-bolts needs that private donors find unattractive.
“The largest portion of money that goes out from a state agency, typically, is for general operating support,” noted Katz. “That’s what generally doesn’t get funded by corporations, foundations or individual donations, which are often project- or building-related.
“That’s one area where state arts agencies are distinctive in their giving. If you took them away as a funding entity, lots of organizations would notice it, but the mid-sized and smaller ones would notice it the most, because the grants make up a larger portion of their budget.”
But like her colleagues, she argues the seed money her agency distributes stimulates the state’s economy and ultimately increases tax revenues.
“A healthy arts economy, stimulated by a small bit of government investment, reaps huge rewards,” said Bob Lynch, president of the advocacy group Americans for the Arts. “We estimate the aggregate budget of the 109,000 nonprofit arts organizations in America adds up to about $66 billion. That spins off an economic impact of $166 billion, using a very conservative model.”
In an attempt to educate political leaders, Lynch and his colleagues have put together maps showing the economic impact of the arts on specific states and metropolitan areas. He reports they tend to make a strong impression on stage legislators, who, in his experience, are driven more by numbers than ideology.
“Often, arts organizations will suggest I make an argument for the inherent value of the arts,” he said. “When I am talking to legislators, about one-third of them will want to talk about that. They’ve had a moment in their lives when they saw how the arts changed their life or the life of their community. They get it.
“But that leaves the other two-thirds. They respond to a number of different arguments, depending upon their particular constituency. We are asked about things such as how the arts contribute to educational success, or how the arts could play a role in downtown revitalization. We have data on all that, but the issue we’re asked about most by state, federal and local legislators is jobs and the economic impact of the arts.”
And if budget-cutting legislators insist they’re merely responding to public opinion — well, there’s data on that topic as well.
“If we believe our polling, a large majority of the population thinks it’s a good idea for the state to invest in the arts,” said May. “The University of South Carolina conducts a general poll twice a year of the state’s population. It’s a good, reliable poll, demographically representative of the population.
“In the fall of 2009, (we arranged to have them) ask people if they were in favor of state government support of the arts. Ninety-two percent said they were. Forty percent favored increased funding. That’s pretty impressive when you consider the state was in economic freefall at that time.”
May reports that a grassroots effort to save his agency is already underway in South Carolina, as the budget moves through the legislature. “We are bringing the news to folks that it’s going to be a long fight, so get ready,” he said. “Facebook has brought in a lot of new people who are very interested in the arts and the government’s contributions to the arts. For getting a message out quickly, it’s a pretty amazing tool.”
“The dance right now is how to convince enough legislators to keep us in the game,” said Washington state’s Tucker. “We need to be far enough off the radar so that we don’t attract attention but enough on the radar so they don’t forget we need to be part of the future. It puts us in a tricky position. But I’m an optimist; I believe, at the end of the day, we’re going to survive.”
There certainly is precedent for survival. Katz notes that a number of states have considered eliminating state arts agencies in recent years, but after examining the evidence, they’ve all backed down.
“In New Jersey, they passed a new state occupancy tax, and they’re funding the arts through that,” he said. “In Massachusetts, the money for the arts comes from lottery funds. In South Dakota, they very quickly realized the arts were an asset in this economy, and they included the arts in a state sales tax increase. So in many cases, states realized they’d be doing harm by cutting or eliminating these agencies, and opted instead to find a dependable revenue source for them.”
Still, as Arizona’s Booker concedes, 2011 is going to be a very tough year. Antitax sentiment is high in many states (including his own), which suggests drastic cuts are the only way to balance the budget. The only reason his agency isn’t facing elimination is that in 1989, the legislature added $15 to the corporate filing fee and directed the money to an Arizona Arts Trust Fund.
The situation calls into his mind an image that is almost as disturbing as the syringe/paint brush mashup he proudly points to as an example of his agency’s work.
“The arts are the golden goose, and we lay some pretty great eggs for our communities: economic impact, education, tourism, cultural understanding, civic engagement,” he said. “At times I feel like our elected officials have their hands around the neck of the goose. They don’t realize they’re killing an industry that is forward-thinking, creative and helping our state recover.”