Legislators could cost Wisconsin more than $100k in federal arts funding

Without matching funds from the state, National Endowment from the Arts grants for 163 arts organizations are in limbo.

Arts organizations around Wisconsin could miss out on a big chunk of federal money because the state legislature’s Joint Finance Committee has yet to sign off on a routine transfer.

Every year, the National Endowment for the Arts parcels out federal funding to state-level arts agencies, including the Wisconsin Arts Board, to distribute in the form of individual grants. The states have to match this money. For the latest round of these grants, the Arts Board is waiting for the state to put up the remainder of its share of the match by transferring $109,200.

The Arts Board requested this transfer in November 2021. It still hasn’t happened, and organizations counting on that money are getting nervous. 

“There’s over 100 organizations that are waiting for these checks, and it ranges from the large organizations in Milwaukee to the smaller organizations in the northwoods,” says Anne Katz of Create Wisconsin (formerly Arts Wisconsin), a Madison-based nonprofit that advocates for public investment in the arts. 

The 163 organizations currently waiting on these funds include bigger players like the Overture Center and Kohler Arts Center, alongside grantees like the Flambeau Valley Arts Association in Ladysmith and the Red Cedar Symphony in Rice Lake. They represent 37 of Wisconsin’s 72 counties. 

The fact that $109,200 can create such a crucial impasse is emblematic of the overall condition of public arts funding in Wisconsin. A report from the National Assembly of States Arts Agencies found that in its 2021 fiscal year, the state of Wisconsin allocated about 29 cents per capita to the Wisconsin Arts Board. That report placed Wisconsin in 48th place among the 50 states. In other years, Wisconsin has ranked dead last. 

George Tzougros, executive director of the Wisconsin Arts Board, says he’s never seen this process drag out for so long. “It’s taken some time but it’s never been May,” Tzougros says. “It might have been February or March but it’s not been May. This is an unprecedented amount of time we’re waiting.”

The deadline for the JFC to approve the request is June 30, the end of the state’s fiscal year. ​​”There may be some flexibility because the federal fiscal year ends September 30, however the continued delay is a hardship to the organizations,” Tzougros notes.

Increased federal funding, with state-side obstacles

The $109,200 isn’t all the money the Arts Board can distribute, but missing out on it would effectively mean the grants it was planning to hand out would have to be cut down significantly. 

The money is hostage to some pesky technicalities of the state’s budget process. During the state’s biennial budget cycle, the Legislature allocates a certain amount for the Arts Board. Generally it’s not until after the budget has passed that the NEA announces how much it will actually be giving the state. So when the NEA gives more than the state budget is already providing, the state has to adjust accordingly in order to fully take advantage of that federal money. 

State agencies deal with such issues by making requests to the Joint Finance Committee, a process known as 13.10, after the state statute that provides for it. 

In February, four Democratic JFC members—District 27 Senator Jon Erpenbach, District 18 Rep. Evan Goyke, District 6 Senator LaTonya Johnson, and District 74 Rep. Beth Meyers—sent a letter to the committee’s Republican co-chairs, District 17 Senator Howard Marklein and District 39 Rep. Mark Born, asking that the Arts Board’s request be placed on the agenda for the next Joint Finance committee meeting.

Even though the Legislature as a whole has been on vacation since early March, JFC has continued meeting during March and April to field 13.10 requests, exercising its authority to make adjustments to the state budget. Recent agendas have included transportation funding and lawsuit settlements, but not the Arts Board’s request.

Marklein and Born’s offices did not respond to a request for comment for this article by deadline. Staff in Goyke’s office shared a copy of the letter but declined to comment on the record.

Marklein’s southwestern Wisconsin district includes one of the state’s most prominent and widely loved arts organizations, American Players Theatre. And apparently even they can’t get much of a response. APT communications director Sara Young says that she and others, on the theater company’s behalf, “have called Senator Marklein’s office, numerous times, and have not talked to him personally about it. 

“I’ve only successfully talked to staff members about this, and it’s all been rather non-committal and the stock answers that you would get,” Young continues. “‘We’ll consider it, if there’s another 13.10 meeting, we will consider it being on the agenda.’ But no, we haven’t gotten anything in the way of assurances about it being part of the agenda.”

Even if Wisconsin’s Legislature is stingy on the whole with arts funding, this part of the process usually isn’t such a problem.

“The grants should normally have gone out in the end of December, early January at the latest,” Tzougros says. “People should have had their checks that long ago.”

Here’s how the math breaks down: 

• The NEA allocated $887,100 to Wisconsin in its latest round of state match funding—this corresponds to the federal government’s 2021 fiscal year but the state’s 2022 fiscal year.
• The Legislature’s latest biennial budget allocated $807,100 toward the state’s share of the match for the state’s 2022 fiscal year. 
• The state also still needs to backfill $29,200 towards the previous year’s NEA match.
• So, the state has $80,000 worth of catching up to to toward this year’s match, and $29,200 toward the previous year’s, adding up to $109,2000.

This is in some senses a good problem to have—provided that JFC does its job on time. “The federal dollars have been going up incrementally over time, through the Trump administration and now the Biden administration,” Tzougros says. “It’s just been going up and up and up, which means the state has to keep up.”

NEA’s state-match program gave Wisconsin:

•   $787,100 in 2018
•   $798,900 in 2019
•   $813,700 in 2020
•   $813,097 in 2021
•   $887,100 in 2022

The impact so far

Tzougros worries about the false perception that arts organizations are coasting comfortably on the various rounds of federal COVID relief they’ve received. 

“If they were lucky enough to get Rescue Plan money or CARES Act money or some of that [COVID relief funding], they may have had some things to tide them over,” Tzougros says. “But [that] money was specific for mitigating the costs of COVID, whether that was maintaining staff or a facility or getting the kinds of things that were necessary to clean the facilities, whatever—that’s what that money was for. It wasn’t for the general operation of the organizations. And as they wait for audiences to return … there’s not a lot of fat on the bone at this point.”

The Arts Board wrote in a recent memo that “the lack of the match funding has already caused the Arts Board to delay payment of grant awards to Wisconsin arts businesses until the match is met.” If the JFC doesn’t transfer the money, the Arts Board would have to scale back the amounts of the grants it’s parceling out, issue fewer grants, or both.

“If the Arts Board is unable to draw down these funds, the National Endowment for the Arts will re-allocate these [unmatched] dollars to another state arts agency,” the memo noted. “The dollars will not be returned to the federal government to be used in other ways.”

Public arts grants (whether from the NEA, the Wisconsin Arts Board, or a local-level agency like Dane Arts or the Madison Arts Commission) almost always depend on matching elements. One grant doesn’t provide the full budget for a given project; instead, the grant serves as something of an anchor for the recipient to attract funding from other sources, public and private. Even if the initial arts grant is only a small amount of money, it provides crucial leverage, and a sense of stability and credibility for other funders. The grants are built around the assumption that all these different pieces of funding and support will come together.

“It’s definitely a sort of Jenga structure. You lose this one source of funding and then everything else—I won’t say ‘falls apart,'” Katz says. “I mean, people are so creative with the funding that they have. It’s really impressive. They do a lot with not very much and, again, the purpose of public funding is to really help people engage in the arts.”

In that “Jenga structure,” a public grant of even a few thousand dollars provides something of a cornerstone. At an organization like Madison-based Arts for All Wisconsin, which provides arts programming for adults and kids with disabilities, having to wait on such funding is “really counterproductive,” says executive director Christina Martin-Wright. 

​​”There are very few funders that we look to for ongoing support, and the Wisconsin Arts Board—while there are never any guarantees by any means—has been a very steady and reliable source of funding if we do our job right,” Martin-Wright says. “And we have done our job right.”

Whether or not the money comes through, the ripple effect will be significant. “This relatively small amount of funding packs a big punch,” the Arts Board’s memo notes. “Wisconsin’s creative industry provided a $10.9 billion economic impact, with over 96,000 jobs, before the pandemic.” 

Arts for All generally receives between $5,000 to $7,000 from the Wisconsin Arts Board in a given year, Martin-Wright says. It uses some of that money to hire teaching artists around the state. “For some people, depending on the community and what kind of cultural programming is offered for people with disabilities in that particular community, it could mean the difference between not having a creative social outlet or having one,” Martin-Wright points out.

The money that’s in limbo here may not spell life or death for larger organizations, but is a far bigger share of the budget for smaller organizations, including those operating in rural areas and small towns. Not all arts organizations have a generous cushion of reserve funds to fall back on, or other reliable, major sources of revenue to make up the difference.

“What concerns me is the smaller organizations and community arts organizations,” says APT’s Young. “We have an organization here called River Valley Arts here in the Spring Green area, that depends, I think, more on those dollars to continue their programming and their re-granting. It’s definitely affecting the day-to-day operations of artists and small arts organizations in our community, and I’m sure that that’s the case statewide.”

Until JFC actually transfers the money, the organizations awaiting it will have a harder time budgeting confidently. The delay is adding more uncertainty at a time when arts organizations are still dealing with the damaging effects of the pandemic, and federal COVID relief has run out.

“We’re almost at the end of the fiscal year for a lot of organizations, so they don’t know how their budgets are going to be affected, because they don’t know the amount of money that they’re gonna get,” Katz says. “They will get something, but it seems counterproductive to give money back to the feds when we’re talking about money that will really do a lot of good. The Arts Board does not give out big grants. They give out a relatively small amount of funding, but that funding is matched in the local communities many times over. Even a small grant that the Arts Board will give to a small organization makes a big difference in that community.”