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The Future of the Arts & Culture Sector
No matter which side of the political aisle you sit on, these are dizzying and disorienting times, especially for cultural institutions. And museums may be in for a particularly rocky road.
While we do not have confirmation that the Trump Administration’s proposed budget will eliminate funding for the National Endowment for the Arts and the National Endowment for the Humanities, the president has been explicit about his intention to do just that. Each endowment operates with an annual budget of $150 million. The endowments represent .002% of the federal budget at an annual cost per American of $0.92 to fund both. The endowments benefit our communities in many ways:
- 40% of those dollars go directly to state and regional councils which are free to support the projects they believe are most beneficial to the constituencies they serve.
- 40% of NEA dollars enrich rural communities.
- The NEH Challenge Grant program has leveraged federal funds at a 3:1 ratio; grants made through the Public Programs division have yielded an 8:1 ratio.
- State humanities councils realize $5 in impact for every federal dollar invested.
- According to the Bureau of Economic Analysis, the arts and culture sector contributed more than $704 billion to the US economy – 4.7% of the US GDP -- and employed 4.74 million people in 2013.
The potential loss of federal support would be a serious blow, and the news for nonprofit organizations is no cheerier at the state level. Legislators this session may consider tax measures that could have serious implications for nonprofits, including museums. While museums currently pay sales tax on ticket sales, other mission-driven programs, including school programs, have been tax exempt. New legislation may impose sales taxes on all of our revenue-producing programs; additional legislation could levy property taxes on nonprofits. As museums struggle to reach new, under-served audiences while also balancing the books, new tax liabilities and the loss of federal funding will be difficult to absorb.
We confront these challenges at a time when the national political landscape is in upheaval and Charlotte leaders, businesses and organizations are working together to improve mobility and increase equity in our own community. It’s a time when our mission has never been more important. Now is the time to turn to history for guidance and enlightenment.
We are more determined than ever to focus our programs, solidify our financial base, and to use history to build community. And we are, as ever, grateful to you for your abiding support.