Fearful Minnesota arts groups hope for tax windfall

  • Article by: GRAYDON ROYCE
  • Star Tribune
  • October 28, 2008 - 11:30 PM

Sheila Smith has heard the argument: A constitutional amendment is not the way to address state budget inequities. But the executive director of Minnesota Citizens for the Arts fears that the traditional way of doing business -- competing for the attention of legislators hashing out conflicting requests -- has ill-served arts groups and patrons.

When the state budget was cut by 14 percent in 2003, arts funding dropped 32 percent, an event that stung Smith and other advocates sharply.

So when the Legacy Amendment was proposed for funding outdoors and environmental interests, the arts asked to get on board. Hunters and anglers weren't crazy about the arts piggybackers, but the unlikely union stuck.

Now, after more than a decade of dispute on this issue, the voters will decide.

The ballot proposal this November would increase the sales tax on $10 by 3.8 cents and potentially raise $276 million annually. Of that, arts statewide could get 19.75 percent, or an estimated $54 million. Arts supporters look at 2003 and worry that without the guarantee provided in the amendment, their causes eventually will lose even current levels of funding.

"The arts are clearly not the most powerful political force at the Capitol. That's why they get short shrift," said Larry Redmond, an MCA lobbyist. "I don't think there will be any arts funding in 15 to 20 years if we don't do this. It's a big increase, but the point of this is that arts should be available to the average member of the public, and but for philanthropy, the nonprofit arts organizations would not exist."

None of that sits well with Verne Johnson, chairman of the Civic Caucus, a nonpartisan group that promotes policy debate.

"They are very valuable to our community," Johnson said of the arts. "But if you bypass the legislative process, you've given one group a permanent advantage. And once you start down that route, everyone will see that it's a way to get around the process, and education, health care, other causes, will want to do that."

If the Legacy Amendment passes, the State Arts Board could see the annual appropriation rise to $30 million, tripling its current level. The state agency's budget was as high as $13 million a year in 1998, and as low as $8 million in the 2003 cuts. In addition, $10 million of the proceeds under the amendment would fund arts education with the remainder going to the Minnesota Historical Society and local historical societies.

Though comparisons are imprecise, Minnesota's state arts board fares well when compared to similar states, such as Wisconsin ($5.3 million per year) and Michigan ($8.5 million). It would seem far better off than Colorado ($2.4 million), but metropolitan Denver uses a 1 percent sales tax to fund a Scientific and Cultural Facilities District that provides $40 million annually to nonprofits. In Missouri, arts councils in St. Louis and Kansas City supplement $10 million from the state. In 2008-09, the St. Louis council will distribute grants of $3.6 million.

State rankings

Minnesota has a disproportionate reputation for arts and cultural institutions, arts advocates say. The metropolitan area is home to two world-class orchestras and two art museums, a theater scene that sells more tickets per capita than any market other than New York, significant choral-music activity, dance and visual arts.

Outstate, Duluth and Rochester have large civic theaters and orchestras. The MCA and Americans for the Arts in 2006 claimed that arts produce $1 billion in economic activity throughout the state. A Pew research study in 2004-05 found that Minnesota has a much higher rate of people who actually participate in arts in daily life.

"The arts can be an anchor in redeveloping a neighborhood or community," said Sue Gens, interim director of the state arts board. She cited northeast Minneapolis, where a visual-arts district attracts crowds with Thursday-night gallery openings.

Outstate, the issue is twofold: revitalizing communities hit by population decline and refreshing funding for arts in schools. Rebecca Peterson has run a successful project at the Center for the Arts in Fergus Falls, where a refurbished moviehouse draws about 18,000 people a year for music, theater and performance. The organization also collaborates with the school district.

"Arts centers in communities help hold school-arts programs together," Peterson said.

Not everyone is convinced. Rebecca Hoover of Little Canada posted a comment on the Star Tribune website that agreed with the newspaper's editorial endorsement of a "No" vote on the amendment. Hoover finds the mechanism inappropriate, particularly because it uses the sales tax, which is regressive. Beyond that, Hoover feels the priority is misplaced.

"Given the many, many often heartbreaking needs of our citizens, government funding of the arts is about my lowest priority," Hoover said in an e-mail.

Redmond responds that those issues already have natural strength in the Legislature. He points to the referendum approved two years ago that dictated a percentage of state monies go to transportation.

"That took money away from other needs," he said. "This constitutional amendment raises its own money. We're not taking money away from anybody."

Johnson, of the Civic Caucus, points out that the group opposed the transportation initiative, too.

"We're very strong for transportation, but we were against that amendment," he said. "I can sympathize with them [arts groups] but it's destroying our system."

Graydon Royce • 612-673-7299

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