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Local-Option Tax Arts-Funding Initiatives On Ballots Nationwide

Who would have thought the poor, underappreciated penny would play a role in next week's election? Yet in the metropolitan area of Denver, it does. Voters, for the first time in a decade, must decide whether to reauthorize the 0.01% retail sales tax that funds the Scientific & Cultural Facilities District (SCFD), a program that has distributed more than $400 million to arts and science groups since 1988.

While local reporting describes the electorate's mood as generally inclined to reauthorize the SCFD, it is difficult to overestimate how dependent the area not-for-profits have become on the proceeds from the tax. For example, 6% of the operating budget of the Denver Center for the Performing Arts comes from the SCFD—about $3 million a year.

In Kansas City, meanwhile, residents of five Missouri and Kansas counties must decide whether to greenlight a one-fourth-of-one-cent retail sales tax that, over 12-15 years, would raise $500 million-$600 million for arts- and sports-building projects. The ballot language states that, during the first four years of the tax, $12.5 million would be allocated annually to building a Kansas City Performing Arts Center, with a sizeable portion of the remaining funds to be handed out to a multitude of regional arts and culture organizations.

Even tiny Billings, Mont., population approximately 90,000, is getting into the act. For the fourth time in eight years, an arts-funding initiative is on the ballot. This newest proposal would place a levy of 3.35 mills—a mill is one-tenth of one cent—on property taxes, raising approximately $600,000 a year for such organizations as the Alberta Bair Theater, the Billings Studio Theatre, the Billings Symphony Orchestra, and Billings Cultural Partners, an umbrella group for local nonprofits. Voters rejected three previous, not dissimilar proposals.

Beyond the specifics of each ballot question, what is really at stake, says Randy Cohen, vice president of research and information at Americans for the Arts, is the perception that "local-option taxes" produce tangible, arts-friendly results for communities, not another burdensome layer of state or municipal bureaucracy. In Denver, Cohen says the stakes are especially high because the numbers are large and because the SCFD has been for 15 years a real pioneer in the struggle to find new ways to fund the arts without relying on state treasuries. As such, the SCFD is, he said, "the most celebrated example of a local-option tax in the country."

Whether it's Denver, Billings, or a unique, two-state-straddling city like Kansas City, Cohen says the important thing to remember is that all arts-funding politics, like all politics in general, is local.

"I definitely think if the initiatives pass it would add momentum to the whole concept of local-option taxes as a way to fund the arts," Cohen says, "because we see leaders everywhere at the municipal level looking for innovative ways to fund the arts and to make them more accessible to their community—to make voters feel they are a part of a community. If you look at something like the Scientific & Cultural Facilities District, local-option initiatives have been effective; they make good economic sense because they make communities a good place to visit. And we all know arts and culture are the cornerstones of tourism in most of the country."

But the electorate can be fickle. Last March, an attempt in Cuyahoga County (encompassing Cleveland), Ohio, to increase property taxes and raise revenue to fund the arts and spur economic development was handily defeated.

"You have to think about what reasoning appeals to which kinds of people," Cohen says. "The economic-investment argument resonates strongly with elected leaders, but not with the general public. Of course voters want museums, zoos, and theatres, but you have to connect. You have to campaign to help the public understand the value."

Cohen cites the case of Tempe, Ariz., which successfully funded a cultural facility by passing a one-mill sales tax—that's one-tenth of one cent—by comparing the cost to a McDonald's Happy Meal: "It seems funny, but it gives people a clear idea of the cost. Cleveland, on the other hand, wanted a tiny increase to the property tax, which is always harder to do, and, when the supporters said the money would go to 'economic development,' people weren't clear what that meant. So never underestimate the value of a great slogan or comparison. It's always a communications campaign."

Arts-funding initiatives, Cohen added, are often viewed by supporters as more likely to pass if they are piggybacked onto measures that are no-brainers for the electorate: In Billings, the cultural levy is linked to a plan to grow the police and fire departments. But piggybacking, too, can be problematic: "There's always a debate about building stadiums," Cohen says, "and I think the public may now be getting tired of financing them. Truthfully, I wonder if the arts might fare better on their own rather than hitch their wagons to controversial plans."

Regarding which of this year's arts-funding initiatives might pass or fail, Cohen diplomatically took a pass, but he did note the relative popularity of Denver's SCFD, where a recent poll found 63% favoring renewal and only one group actively working against it: "Fortunately, if the Denver reauthorization fails, at least it's on the ballot two years before it expires, so it could be saved. But if it failed, it would put a big strain on local cultural organizations and ultimately it would cut arts opportunities for those living in metropolitan Denver. When you cut that kind of revenue stream, you're going to see the arts hurt. When you prevent that kind of revenue stream from being created, you prevent access to the arts and you prevent the development of the arts as a whole."

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