By Jennifer Leitch, Development Officer
Every other year on the first Tuesday after the first Monday in November, Americans cast their ballots and help shape the direction of our country. In honor of the hard-won privilege to vote, we have highlighted some current legislative issues that impact the arts in this country.
The California Arts Council (CAC), a state agency whose mission is to advance California through the arts and creativity, and who provides hundreds of grants to California-based arts organizations each year (including P.S. ARTS), faced a big hurdle at the start of the 2013-2014 fiscal year: an almost 7 percent budget reduction. This was especially dismal considering that nationally, California has consistently ranked at or near the bottom in per-capita funding for arts grants. However, thanks to the collective effort of Californians for the Arts and other arts advocates, in mid-July, Assembly Speaker John Perez made a discretionary allocation of an additional $2 million to the California Arts Council, doubling what the CAC was slated to receive. This additional funding, which comes from savings in the 2013 State Assembly operating budget and is the first increase in tax-payer supported funding for the CAC in ten years, is restricted for grants and services that directly support the arts in California communities. We are thrilled to be the recipient of a California Arts Council grant, and thank the Speaker for his dedication and commitment to the arts in California!
On a federal level, the situation isn’t as bright. In the wake of ongoing debates surrounding tax reform, there is concern that charitable giving incentives will be reduced or eliminated; a 100-year old tradition that has benefited millions of Americans and that has helped establish a history of charitable giving in the U.S. that is unrivaled. The provision in question, which allows taxpayers to deduct donations made to nonprofits, not only threatens the nonprofit sector, but also the communities they serve. Charitable giving is a significant, if not primary, source of revenue for nonprofit organizations (P.S. ARTS receives approximately 80% of its revenue from charitable donations), and while most giving is motivated by the cause it supports, history has shown that donors do respond to tax law changes by altering when and how much they give. Without this support, the level of programming and services offered to those in need would be dramatically reduced. Capping the charitable deductions would also result in the loss of nonprofit jobs – a consequence that could potentially have a lasting and harmful impact on the sector. Here are a few more facts about the charitable tax deduction and nonprofits:
- For every $1 dollar in deductions claimed, charities receive $3 dollars in revenue.
- There are approximately 1.4 million nonprofit 501(c)3 organizations in the U.S., including arts organizations, hospitals, private schools, institutions of higher education, religious congregations, public television and radio stations, soup kitchens, and foundations.
- U.S. nonprofit organizations contribute $1.1 trillion in human services every year and support 13.5 million jobs.[1]
Charitable giving incentives are an investment in the public good and are essential to the health of the nonprofit sector. The budget committee is expected to report on issues surrounding tax reform and long-term spending decisions on December 13, 2013. You can help us preserve the charitable giving incentives by emailing your legislators (find your legislator here).
For more information about other legislation affecting the arts (including a proposed 49% cut to the NEA to be considered when the current Continuing Resolution expires in January), please visit the Americans for the Arts website.
