What they’re thinking: Art programs small part of budget, big part of economy

CEDAR RAPIDS — Earlier this month, President Donald Trump proposed a federal budget that sharply cuts domestic spending to divert more money to the military and to immigration enforcement. Some of the areas he targeted for outright elimination are the $148 million National Endowment for the Arts, the similar $148 million National Endowment for the Humanities and the $230 million Institute of Museum and Library Services.

Sean Ulmer, executive director of the Cedar Rapids Museum of Art, weighs in on what that could mean if the proposal were eventually adopted by Congress.

Q: If funding for the National Endowment for the Arts were eliminated, what kind of trickle-down effect might arts presenters feel at the local and state levels?

A: The NEA provides funds directly to the Iowa Arts Council, which are then regranted on the local level to many organizations, including museums.

According to the American Alliance of Museums, NEA support to the Iowa Arts Council was $1.8 million in data from 2014-2016. According to the same source, $68,000 in the form of three grants came to Iowa museums during that period.

Similarly, the National Endowment for the Humanities granted $2 million to Humanities Iowa, and Iowa received $1.4 million through eight NEH grants to Iowa museums.

The Institute for Museum and Library Services, also on the chopping block, awarded $433,000 to five Iowa museums during that period. ...

The NEA money supports a larger creative economy that in 2013 employed 4.74 million people and contributed more than $700 billion (or 4.2 percent) to the U.S. Gross Domestic Product, according to the Commerce Department. ... The NEA awarded 2,500 grants this past fiscal year, spread across all 435 congressional districts.

If it were eliminated, organizations in larger cities such as New York, Chicago and Los Angeles might be able to make up the difference by tapping their donors, simply because they have more of them. The real impact would be on smaller cities and rural areas, both of which have a more-limited donor pool.

Q: What will it take for local and state arts organizations to make up that shortfall, should it come to fruition?

A: Local and state arts organizations are already strapped. No organization that I know of is completely funded by the NEA and thus are already actively making up their annual shortfall.

In early 2015, The Association of Art Museum Directors published a survey that determined that on a national basis, revenues from art museum visitors average $3.70 per visitor but expenses per visitor are $53.17. These expenses include costs of maintaining the proper environmental controls, security, staffing and costs of the exhibitions and educational programs themselves.

That nearly $50 difference per person is why art museums sell memberships, ask for annual fund support, appeal for corporate underwriting and write grants to local, state and federal agencies.

According to that same survey, nationally, art museums derive their support from three major areas: individual support (67 percent), corporate support (13 percent) and foundations, trusts and grants (20 percent). For the Cedar Rapids Museum of Art, our numbers are similar: individual support (69 percent), corporate support (17 percent) and foundations, trusts and grants (14 percent).

With potentially less money coming in from sources such as the NEA, a greater burden will fall upon individual and corporate supporters.

Q: How does that compound the challenge of finding revenue streams after the Iowa Cultural Trust fund was nearly drained when Gov. Terry Branstad signed a bill Feb. 1 to address a state budget shortfall?

A: The Iowa Cultural Trust was one of those state resources that helped to make up the difference in budgets. It had very specific parameters and the Cedar Rapids Museum of Art was fortunate to receive $2,371 in 2009 in a sustainability grant and $28,000 in funds in 2010 for an endowment challenge match. Now that that money is gone, the avenues for increasing an arts or cultural organization's budget in a sustainable way are gone.

Both endowment growth and sustainability grants sought to make arts organizations more self-reliant in the long term.

Q: What kind of messages do such deep cuts to arts programming send, not only to artists and presenters, but to communities and other organizations?

A: Businesses are hiring more and more people with an arts background because people trained in the arts think differently. They solve problems differently and thus are a welcome addition to most work environments seeking to move their companies forward.

Any group of employees can solve problems the way they always have, but insert an arts person into the mix and suddenly the conversation changes, new solutions appear and companies prosper. ...

In addition to the value seen by businesses, the arts and cultural industry nationally is an economic powerhouse. It is a $700 billion industry contributing more that 4.2 percent to the national economy.

That's bigger than construction ($587 billion) and transportation and warehousing ($464 billion), according to the Department of Commerce. The nonprofit arts and culture industry annually generates $22 billion in local, state and federal tax revenues, far more than it receives from government sources.

Locally, a 2010 survey showed that 62 participating Corridor arts and culture organizations make nearly $80 million in economic impact annually, with $50 million spent by the organizations themselves and another $30 million by our visitors. Locally, some 2,700 people are employed by these 62 nonprofits, which equates to $52.4 million in household incomes. These same 62 organizations generated $7.4 million in local and state government revenues. Even if you are not actively involved with an arts and culture organizations yourself, the economic impact is clear.

Q: In this digital age, when so much information and so many images are just a click or online-search away, why are museums important?

A: Because 850 million people told us so. That's how many people visit a museum in the United States on an annual basis. That's more than the number of people who attend all major league sporting events and theme parks combined.

Museums are the No. 1 most-trusted source of information in America, more than Wikipedia, local newspapers, professors or the U.S. government. In addition to preserving and protecting more than one billion objects — many of them national treasures — museum volunteers contribute more than 1 million hours of service every week ...

Why do museums matter? Simply put, they are necessary to our survival as a nation and as a people.

l Comments: (319) 368-8508; diana.nollen@thegazette.com