February 14, 2011
From: Thomas L. Birch, Legislative Counsel
Vol. 05:11

President’s 2012 Budget Proposes NEA Fund Cut

President Obama sent his fiscal year 2012 budget proposal to Congress today, with a cut in funding for the National Endowment for the Arts (NEA) from the 2010 level of $167.5 million to $146.255 million. (Congress still has not resolved federal government spending levels for 2011.) In each of the past two years, the Obama administration has requested funding for the NEA at $161.315 million. The funding level proposed in the administration’s 2012 budget is close to the amount appropriated to the NEA in 2008, at $144.7 million.

At the same time as the president asks Congress for a reduction of $21.25 million in appropriations to the NEA, the administration’s budget proposes to allocate $5 million for the Our Town initiative. With a break in precedent, the funds for the initiative are not subject to the requirement that 40% of grant-making funds be allocated to the state and regional arts organizations. The budget documents also explain that NEA funds to the states for arts education above the 40% allocation will be available at a reduced level.

The NEA is seeking statutory clarification regarding the allowed match for grants made by state arts agencies. The administration’s intention is to “clarify that match must come from funds controlled and managed by the State and that funds from third parties not directly controlled and managed by the State are not eligible (such as subgrant match.)” The proposed clarifying language would allow states to match with such funds as appropriated funds, donated funds and trust funds.

The administration’s budget document also seeks permission from Congress to develop criteria on the “waive of match” provision for states and regions. The administration explains that while states may seek a waiver authority, it does not appear to be the intent of the NEA’s authorizing legislation “to allow waiver of match in perpetuity,” and guidance is desirable as to the circumstances around the ability of states and regions to seek a waiver of match.

In other changes to the NEA budget allocations, funds for research would increase by almost $1 million over the 2010 levels, and administrative support for salaries and expenses would go up by $1.138 million in the president’s budget proposal.

NASAA will continue to provide additional information about the NEA budget proposal as details become available. In the meantime, Congress is enmeshed in trying to resolve funding levels for the 2011 fiscal year, with the House of Representatives this week working on a continuing resolution for the remainder of the current fiscal year with deep cuts totaling almost $100 billion, including a cut in NEA funding back to $145 million for the rest of this fiscal year. Until this year, with the change in political make-up of the House of Representatives and the general concern about reducing spending overall, the NEA’s funding had grown by more than 35%, from $124.4 million in 2007 to $167.5 million in 2010.