Arts Funding a Murky Picture for Coming Year

Times Staff Writer

The federal arts budget has set a record--but, by government standards, only in pennies.

The National Endowment for the Arts’ $167.7-million budget for fiscal 1988--part of the government’s $600-billion-plus spending authorization bill signed Dec. 22 by President Reagan--is up slightly from its fiscal 1987 budget of $165.1 million.

The arts had a mixed year in 1987. While major cultural edifices were erected, such as the $70-million Wortham Center in Houston, the stock market crashed and it was the first year under a tax law that discourages contributions to nonprofit organizations.

But a more complete arts picture depends on where you live.


Whether because of exhortation or sheer necessity under the Reagan Administration, the mid-1980s have seen increased incorporation of private-sector donations into state arts agency budgets. Already, 18 state arts agencies have some mechanism by which their budgets can be enhanced through private funding.

Oregon more than doubled its arts budget with a $743,000 challenge grant program, while Minnesota added $600,000 to its $3-million state appropriation.

Five states--Florida, Indiana, Rhode Island, Montana and North Dakota--even have special privately funded arts endowments.

In 1988, California may become the 19th state to have a special “challenge” program for the state Arts Council--if the Democrat-controlled Legislature approves.


Under the proposed $1.85-million California Challenge Program, championed by Republican Gov. George Deukmejian, arts institutions would be required to match their grants exclusively with new or increased private dollars. Traditionally, arts institutions have been allowed to match awards with private and public monies.

At present, California’s arts budget is $14.5 million--$13.6 million from the state Legislature and $923,000 from the National Endowment for the Arts. At 50 cents per capita for the arts, California ranks 26th among the states in arts funding.

Nationwide, state arts agency appropriations rose in the current fiscal year to $244.9 million--an increase of 13.3%, according to figures supplied by the National Assembly of State Arts Agencies. Many states, including California, have increased budgets. However, arts agencies in oil, mining and farm states experienced a significant decline in funding.

For Los Angeles, 1988 could be a banner year in arts funding.


A special blue-ribbon citizens task force headed by developer Rob Maguire is proposing a 1%-for-art requirement not only on all city capital improvement projects, which about 30 cities in the nation already have, but a 1% requirement from most major private commercial developments in the city.

According to Councilman Joel Wachs, chairman of the council’s Recreation, Parks, Library and Cultural Affairs Committee, the new program, if approved, could generate at least $15 million annually for the arts. Currently the city’s Cultural Affairs Department awards $765,000 in grants; another $50,000 is pending. Also, $2.9 million is generated through the City Redevelopment Agency. However, CRA money is limited to redevelopment areas--until this year exclusively in downtown, and now also in Hollywood.

“I’m hopeful that in the next six months we will have (a) law,” Wachs told The Times. “This would take the CRA concept and make it citywide. The arts are just as important in South Central and Woodland Hills as they are in downtown and Hollywood.

“Right now, Los Angeles is way behind other cities. Seattle, San Francisco, New York are in the forefront,” Wachs said. “This would not only catch us up, but put us ahead.”


Meanwhile, a significant portion of the extra money could be expected to flow into the cultural affairs budget. In November, general manager Fred Croton was forced to resign after accusations that he lied on his resume when he came to the city seven years ago. The city is currently on a nationwide search for a new general manager. “The position (now) becomes more attractive,” Wachs said.

Is the $167.7-million national arts endowment budget good news, or just ho-hum?

“Considering everything that’s going on, we’re pleased,” said Anne G. Murphy, executive director of the American Arts Alliance in Washington, the nation’s major arts advocacy organization. “With the spirit of Gramm-Rudman (budget-balancing law) and all the proposed cuts, even a little increase is significant.”

Next year, Murphy said, the strategy for arts advocates will be to hold the line.


“Everyone will be looking for places to cut, so we will have to take strong defensive maneuvers,” she said. “Meanwhile we’ll be looking for new and ingenious ways for raising money. We’ll take a close, close look at the tax situation. Nothing should be taken for granted.”

Peter Zeisler, executive director of Theatre Communications Group, the New York-based alliance of the nation’s nonprofit theaters, sees a bleaker picture. Any sort of increase in the arts budget, he said, is wiped out “when you consider the inflation factor. We’re still where we were five years ago. Any increase is so minor it doesn’t really amount to anything.”

Attitude also depends on how you read the numbers: The endowment budget is $2.6 million higher than the $165.1 million budgeted for fiscal 1987, which ended Sept. 30, and $22.5 million higher than the $145.2 million requested by the Reagan Administration before the Democrat-controlled Congress adjusted the amounts. However, the new arts budget still falls short of the $175 million proposed by the Carter Administration at the end of its term in 1980.

For fiscal 1988, the National Endowment for the Humanities received $140.4 million (an increase of $1.9 million over the previous year) and the Institute for Museum Services got $21.9 million, an increase of $700,000.


Meanwhile, the NEA budget--a major barometer for how the arts are viewed nationally--can be seen as a metaphor for a rather murky arts picture.

The year 1987, after all, saw major expansions, and potential expansions, in the arts from the opening of Houston’s Wortham Center, built entirely with private funding, to the announcement of a $50-million grant from Lillian Disney to build a new home for the Los Angeles Philharmonic on Bunker Hill. On Saturday, with a lot of political and Hollywood fanfare, the $20-million Bob Hope Cultural Center--also built with all-private funding--will be dedicated in Palm Desert.

However, 1987 also marked the first year under sweeping tax reforms and saw the stock market debacle of Oct. 19--the effects of which the arts community has yet to fully measure.

The first fallout appears to have hit art museums.


Edward Able, associate director of the American Assn. of Museums in Washington, pointed to last month’s record $53.9 million sale of Van Gogh’s “Irises.”

Able, saying he was concerned that “more objects (of art) are going on an auction block as opposed to being donated,” said he had read that John Whitney Payson said he “couldn’t afford to contribute the painting (to a museum) because of changes in the tax law.”

Because of the advantageous dollar-exchange rate for foreign investors, Able said that he worries that important art will exit the United States.

“We had a very skimpy year starting new museums,” said Able, whose museum association monitors art museums as well as historical museums, scientific museums, maritime museums, arboretums and zoos.


“Sure, there were a few biggies,” he said, “the Menil Collection in Houston . . . the Museum of Women in the Arts in Washington, the Terra Museum in Chicago. But there is not nearly the number of new museums we have seen in previous years. Over the last five years, there has been a definite decline in the number of new museums.”

Zeisler said it’s not just the number of nonprofit theaters that count, but the kind of work they can afford to do.

“We have quite a few that have opened, but the issue is that each year theaters are being asked to earn more of their income, they have to be very careful about their repertoire, and they really can’t afford to do large-scale work anymore.”

Jonathan Katz, director of the National Assembly of State Arts Agencies, took a more cautiously optimistic approach.


“I don’t know what to expect from the stock market crash. Everybody’s waiting to see. Corporation and foundation heads are saying they’re not changing this year’s level of gifts, but there will be planning for the upcoming calendar year, and I think we’ll learn more then.

“Generally, the better-off donors--the 20% of donors who give 80% of the money--are rather more insulated from the sort of market change than people donating to their local church,” Katz said.

But then Katz added: “The results are not in yet. It’s imperative for people not to assume that things will be the same.”