27 GRANTS AND PUBLIC SUPPORT FOR THE ARTS
The important role of the artist in society raises the issue of what assistance society should appropriately offer to the artist. The legislation creating the National Endowment for the Arts (the “NEA”) in 1965 stated:
[T]hat the encouragement and support of national progress and scholarship in the humanities and the arts, while primarily a matter for private and local initiative, is also an appropriate matter of concern for the Federal Government… [and] that the practice of art and the study of the humanities requires constant dedication and devotion and that, while no government can call a great artist or scholar into existence, it is necessary and appropriate for the Federal Government to help create and sustain not only a climate encouraging freedom of thought, imagination, and inquiry, but also the material conditions facilitating the release of this creative talent.
Whether the NEA has created such material conditions is certainly a matter of debate, since most supporters of the arts contend that far more must be done to aid artists than the NEA has achieved. In fact, with the politicization of funding for the NEA and the consequent reduction of its budget, the elusive goal of facilitating creativity appears to be farther away rather than nearer.
NEA Funding
The budget for the NEA in 1966, the first year of operation, was $2,500,000. From 1965 through 1968 the NEA made more than 128,000 grants that totaled more than $4 billion. From 1980 to the mid-1990s the NEA budget was in the range of $160 to $180 million, but strong political opposition to the NEA caused the budget to fall to $99,500,000 for the 1997 fiscal year. Although this enormous cut was mitigated to some degree, the NEA budget for the 2009 fiscal year is only $144.1 million. Taking account of inflation, this is far less than the budgets prior to 1997. Also, this budget has to be allocated among all the arts. In addition, the amount allocated to the visual arts does not go to individual artists, but rather to the official arts agencies of the states and territories as well as to tax-exempt, nonprofit organizations. The law requires that the NEA allocate 40 percent of its annual program funds to states and regions. Artists must apply to state and local organizations based on their guidelines for grants.
State and Local Support
The first state arts council was created in 1902, but by 1960 only six councils were in existence. However, the period since 1960, when the New York State Council on the Arts was created, has seen the creation of an arts council in every state and territory. The National Assembly of State Arts Agencies (www.nasaa-arts.org) reports that the total of state arts council appropriations for fiscal year 2009 is approximately $328 million and that the state arts councils manage about $412 when additional funds from the NEA and other sources are taken into account. According to Americans for the Arts, for fiscal year 2009 the state arts agencies funded nearly 24,000 projects in over 5,000 communities, often by providing money to local organizations. Of 23,943 grants awarded by states arts agencies, 2,668 were awarded to individual artists. However, grants to local organizations may then be regranted to artists or used for projects involving artists. In general, individuals receive fellowships, public art commissions, and support to work in schools or other community settings.
One innovative step has been supplied by localities requiring a percentage—usually 1 or 2 percent—of construction funds for government buildings to be used for art. Philadelphia initiated the first “1 percent for art” program in 1959. Baltimore followed in 1964. In 1965, San Francisco enacted even more comprehensive legislation giving its arts commission control over design for all public buildings, regardless of whether they were publicly financed. In 1974, Both Miami and Miami Beach became beneficiaries of a similar program under legislation enacted by Dade County, Florida. In 1972, the federal General Services Administration reinstated a policy of spending one half of a percent of estimated construction budgets on art. Many states have now enacted similar programs, including Alaska, Arkansas, California, Colorado, Connecticut, Florida, Hawaii, Illinois, Iowa, Louisiana, Maine, Massachusetts, Michigan, Minnesota, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, Texas, Utah, Vermont, Virginia, Washington, Wisconsin, and Wyoming.
The Artist in the Great Depression
One model for public support of artists was created in the 1930s when the Great Depression made the precarious profession of the artist even more untenable. The federal government, as part of the overall effort to create work, funded a number of extensive art projects. The first program, created under the Treasury Department, was the Public Works of Art Project lasting from December 1933 to June 1934, employing about 3,700 artists without a rigid relief test. The cost was $1,312,000. The next program, also under the Treasury Department, was the Section of Painting and Sculpture which obtained artworks by competitions for new federal buildings. It began in October 1934, and lasted until 1943, awarding approximately 1,400 contracts costing about $2,571,000. The third program, the Treasury Relief Art Project under the Treasury Department, started in July 1935, and lasted until 1939. The cost was $833,784 and 446 people were employed, about 75 percent of whom had been on relief.
The final and most important project was the Works Progress Administration’s Federal Art Project (WPA) that began in August 1935, and lasted until June 1943. The WPA employed more than 5,000 artists at one point, subject to the WPA rules for relief, and had a total cost of $35,000,000. Some of the results of the WPA were: (1) Over 2,250 murals for public buildings; (2) 13,000 completed pieces of sculpture; (3) 100,000 paintings, of which 85,000 were permanently loaned to public institutions; (4) 239,727 prints created from 12,581 original designs; (5) 500,000 photographs; and (6) art centers organized in 103 communities.
The nearly $40,000,000 of federal support spent in the 1930s on the visual arts is of a vastly different magnitude from the support the NEA can now generate. But the WPA suffered from political turmoil, mainly challenges of Communist domination, which even caused some to doubt even the artistic accomplishments and importance of the WPA. If there were a sea change in the contemporary political climate, perhaps the NEA, with increased funding, could use the WPA “as a model for the years ahead, for the artists and the public of tomorrow… for never in the history of any land has so much cultural progress been achieved in so brief at time as in the New Deal years” (Audrey McMahon, “A General View of the WPA Federal Art Project in New York City and State,” The New Deal Art Projects: An Anthology of Memoirs, pages 75-76).
The need for a model suggests the value of looking to other countries that have created systems to support and encourage the arts and the artist. Two countries—Ireland and Japan—are presented to suggest possible programs that differ from the NEA.
Ireland
In 1969, the year that Irish playwright and novelist Samuel Beckett won the Nobel Prize in Literature, the government of Ireland enacted an unprecedented law designed to give tax relief to artists, composers, and writers within the boundaries of Ireland. The minister of finance, in presenting the legislation to the Dail Eireann, stated:
The purpose of this relief is… to help create a sympathetic environment here in which the arts can flourish by encouraging artists and writers to live and work in this country. This is something completely new in this country and, indeed, so far as I am aware, in the world… I am convinced that we are right in making this attempt to improve our cultural and artistic environment and I am encouraged by the welcome given from all sides both at home and abroad to the principle of the scheme. I am hopeful that it will achieve its purpose.
The legislation completely frees the artist, regardless of nationality, from any tax obligation to Ireland with respect to income derived from art. The main requirement for application is that the artist be a resident of Ireland for tax purposes. Simply explained, this requires the artist to rent or purchase a home in Ireland and work at that home during a substantial part of the year. However, while the residence must be uninterrupted, an artist does not necessarily have to be in Ireland for the entire year. Brief trips back to the United States, for example, would not affect an artist’s tax status as a resident of Ireland. Every U.S. artist should remember, however, that the United States reserves the right to tax its citizens anywhere in the world. Pages 212-213 should be consulted for the U.S. tax law applicable to artists who live abroad.
Either a resident or a nonresident artist may apply for the exemption on the grounds that he or she has produced “original and creative work(s) having cultural or artistic merit.” The determination of “cultural or artistic merit” is made by the Irish Revenue Commissioners after consultation, if necessary, with experts in the field. Once an artist qualifies, all future works by the artist in the same category will be exempt from Irish tax. The application forms can be obtained from the Office of the Revenue Commissioners, Secretary Taxes Branch, Blocks 8-10, Dublin Castle, Dublin 2, Ireland. For the artist exempt from Irish tax, the sole Irish tax requirement is that a tax return showing no tax due be prepared and filed with the Revenue Commissioners in Dublin.
While this Irish generosity has not created an enormous incursion of foreigners (its intent was more to keep Irish talent at home than to bring foreigners to the Emerald Isle), enough wealthy Brits took up Irish residence for tax avoidance purposes to bring the whole program into question. As a result, the legislation was amended and, starting on January 1, 2007, limits were placed on the ability of high-income earners to take these deductions. In any event, while the assistance to the individual artist who comes to or remains in Ireland is certainly valuable, Ireland’s hope to create a new Byzantium has yet to be realized.
Japan
Japan has a unique approach under which an organization or individual artist can be registered as a “Living National Treasure.” Legislation in 1955 created the National Commission for Protection of Cultural Properties, which can designate people and organizations as living national treasures for their role in aiding and continuing the culture and arts of Japan. Fields where living national treasures have been designated include ceramic art, dyeing and weaving, lacquered ware, metalwork, special dolls, Noh and Kabuki acting, Bunraku puppets, music, dance, singing, and so on.
The Living National Treasures receive a stipend in order to be able to improve their special artistic talent while training students to perpetuate their art form. Since the total annual budget for Living National Treasures is set at 232 million yen (roughly $2.6 million) and each person receives 2 million yen (roughly $22,500), the maximum number of Living National Treasures is limited to 116.
Grants
For the visual artist who considers seeking a grant there are a variety of funding sources, including state arts agencies, private foundations, and prizes and awards.
All fifty states, as well as the District of Columbia, Puerto Rico, and the Virgin Islands, have art agencies. The programs and application procedures differ from state to state. Since many state agencies give most of their grants to organizations, individuals seeking grants often must be affiliated with an eligible organization. A listing of the state agencies can be found on the Web site of the National Endowment for the Arts (www.nea.gov).
Of the more than 100,000 private foundations in the United States, a relatively small number currently offer support to individual projects. Application procedures vary with each foundation or grant-giving agency. It is important that applicants pinpoint the organization best matched to their qualifications, so careful preliminary research is necessary.
An excellent source of reference for grant seekers is The Foundation Center Network, an independent national service organization that provides authoritative sources of information on private philanthropy. The Foundation Center has its main office at 79 Fifth Avenue, New York, New York 10003. Branch offices are located at 1627 K Street, NW, Third Floor, Washington, D.C. 20006-1708; 1422 Euclid, Cleveland, Ohio 44115; 50 Hurt Plaza, Suite 150, Atlanta, GA 30303; and 312 Sutter Street, San Francisco, CA 94108. There are also one hundred cooperating library collections, which can be located by calling the following toll-free (800)424-9836.
The Foundation Center publishes a number of invaluable books, including The Foundation Directory 2009 and Supplement 2009, which contain listings of grantmakers giving interests, addresses, telephone numbers, financial data, grant amounts, gifts received, plus full application information. Foundation Grants to Individuals is the only publication devoted entirely to foundation grant opportunities for individual applicants. The listings include over 8,300 independent and corporate foundations. In addition, artists can learn about applying for grants in Grantseeking Basics for Individuals. The Foundation Directory Online and Foundation Grants to Individuals Online also allow online access by subscription to this information. The Web site of The Foundation Center is www.foundationcenter.org.
The American Council for the Arts, 1 East 53rd Street, New York, N.Y. 10022, has resources available to visual artists seeking grants. The Web site is at www.artsusa.org/. The New York Foundation for the Arts also maintains such resources available via phone at (800)232-2789, or on the Internet at www.artswire.org.
Awards, Honors, and Prizes (published by Gale Research Company in Detroit) is a two-volume directory of awards for many disciplines, including the visual arts. It describes many different programs that include trophies, medals, scrolls, and monetary awards.
Another organization that provides information concerning grants and fellowships is the Grantsmanship Center, P.O. Box 17220, Los Angeles, CA 90017, or on the Internet at www.tgci.com. The Center conducts proposal-writing workshops and publishes a quarterly newsletter for public and private nonprofit organizations. The Center’s services, and benefits programs, are designed for organizations, not for individual artists who are working independently.
Grants and Due Process
Controversial art, and controversial legislation, resulted in several court decisions that clarified the due process requirements that apply to grant-making agencies such as the NEA. In 1990, Congress amended the statutory framework governing the NEA by adding the following provision:
None of the funds authorized to be appropriated for the National Endowment for the Arts… may be used to promote, disseminate, or produce materials which in the judgment of the National Endowment for the Arts… may be considered obscene, including, but not limited to, depictions of sadomasochism, homoeroticism, the sexual exploitation of children, or individuals engaged in sex acts and which, when taken as a whole, do not have serious literary, artistic, political or scientific value.
To conform to the law, the NEA added a certification requirement that grant recipients would have to sign in advance in order to receive their grants. The recipients had to certify that the grant would not be used to create and disseminate materials that “in the judgment of the NEA … may be considered obscene.” The legislative restrictions, and the certification requirement, caused a furor in the art world. A number of artists and arts organizations brought lawsuits to challenge the restrictions. The success of these challenges is instructive with respect to the constitutional limitations that apply to agencies giving grants.
In two consolidated cases, Bella Lewitzky Dance Foundation v. National Endowment for the Arts and Newport Harbor Art Museum v. National Endowment for the Arts (754 F.Supp. 774), the plaintiffs had been awarded grants but refused to sign the certification and, therefore, could not use the grant money. The plaintiffs argued that the law was unconstitutionally vague, since the NEA would be judging what was obscene. The court agreed that the NEA would have no way of applying at least that part of the relevant judicial test for obscenity that requires a determination of varying community standards. If the NEA cannot really determine what is obscene, how can it give clear guidelines to applicants as to what obscenity is? So requiring the applicants to sign such a certification violates Fifth Amendment due process safeguards, especially in view of the fact that attempts to comply with the certification requirement would have a chilling effect on the freedom of expression safeguarded by the First Amendment.
The defendants tried to argue that the obscenity ban did not violate the Fifth or the First Amendments because the ban was not on expression, but rather was a refusal to subsidize such expression. The court did not accept this argument and observed:
In simple terms, the government may well be able to put restrictions on who it subsidizes, and how it subsidizes, but once the government moves to subsidize, it cannot do so in a manner that carries with it a level of vagueness that violates the First and Fifth Amendments.
In 1991 Congress passed a new law specifying that the courts, not the NEA, would judge the issue of obscenity in the grant-making process and adding a “general standards of decency” test with respect to content. Highly controversial art brought a confrontation under these provisions in Finley et. al. v. National Endowment for the Arts (795 F. Supp. 1457). In this case, the appropriate Panel at the NEA recommended that four performance artists should be funded. The Chairman of the NEA, feeling political pressure, made individual calls to poll the NEA Council, which has to approve the Panel’s recommendations. After this polling, the Panel’s recommendations were not followed and the applications were denied. The four artists then brought legal action against the NEA.
The court reaffirmed that once the government decides to subsidize an activity, it cannot withdraw the subsidy in such a way that free expression is chilled. Beyond this, the NEA had certain guidelines as to how it must approach the making of grants. Plaintiffs’ rights might, therefore, have been violated by overturning the Panel’s decision to give grants on the basis of political considerations. As the court stated, “Political expediency is neither an express nor implied criterion under the statute for the denial of an NEA grant.” Also, the Chairman violated the procedural requirements when he polled the Council, since the Council should have met as a body to consider the recommendations of the Panel. In addition, the privacy rights of the plaintiffs were violated when the NEA released information from the plaintiffs’ application files. Finally, the court concluded:
The decency clause sweeps within its ambit speech and artistic expression which is protected by the First Amendment. The court, therefore, holds that the decency clause, on its face, violates the First Amendment for overbreadth and cannot be given effect.
On appeal before the Ninth Circuit Court of Appeals, the artists won again when the court decided that (1) the First Amendment is violated because utilizing the “decency and respect” clause is viewpoint discrimination, and the NEA fails to “articulate a compelling state interest served by the provision”; and (2) the Fifth Amendment is violated because the clause is unconstitutionally broad, and “decency and respect” are terms that “are inherently ambiguous, varying in meaning from individual to individual.” (Finley v. National Endowment for the Arts, 100 F.3d 671)
The United States Supreme Court, however, held that taking into consideration the general standard of “decency and respect” was not unconstitutionally vague and did not violate the First and Fifth Amendments. The statutory language merely added some imprecise considerations to an already subjective selection process. The Court observed that, “although the First Amendment certainly has application in the subsidy context, we note that the Government may allocate competitive funding according to criteria that would be impermissible were direct regulation of speech or a criminal penalty at stake. So long as legislation does not infringe on other constitutionally protected rights, Congress has wide latitude to set spending priorities” (National Endowment for the Arts v. Finley, 524 U.S. 569).
Microlending: A Local Initiative
Public support for the arts can take forms other than grants. For example, in New Bedford, Massachusetts, the New Bedford Economic Development Council has created a micro loan program for the purpose of helping artists, performers, and creative entrepreneurs.
Modeled on programs that have had success in assisting entrepreneurial activities by poorer people in Third World Countries, the theory of such loans is that access to a releatively small amount of capital can be a stimulus to entrepreneurial success. The program in New Bedford seeks to assist artists to increase their capacity, open a successful business, expand their retail capabilities, move into a live/work space, purchase equipment, and provide working capital.
The loans are in the range of $5,000 to $35,000 per year with an interest rate based on the prime rate and repayment over a period of one to five years. Collateral (that is, property that will be taken if the loan is not repaid) can be either business or personal assets. To be eligible for a loan, an artist must either live or work in the City of New Bedford.
While the program has not been in existence long enough to judge how valuable it will be for artists, this innovative initiative is exciting because of its potential for artists. Perhaps its imaginative force can be the impetus for communities to explore this and other local programs to benefit artists and, through a greater local presence for art and the economic activity generated by the arts, to benefit the community as well.