Status Report

As revealed last night by Mighty Toy Cannon, the Oregon Legislature is moving forward with plans to sweep funds from various state programs to help balance the state's $855 million deficit. In this budget proposal, $1.8 million will be robbed from the Oregon Cultural Trust, including $1.3 million in proceeds from the sale of the Cultural Trust license plate over the last five years. This morning's Oregonian describes how this happened, and reports that arts advocates and the 911 system are the two constituencies that are most enraged.

This morning I spoke with Kristina McNitt, the arts lobbyist in Salem, to better understand the timing of all of his, and I asked her to explain why there appears to be a half-hearted attempt from the state's arts advocacy organization, the Cultural Advocacy Coalition, to combat this action.

Wonk Alert!

The CAC began spreading the call to action last Wednesday night, just after the proposed sweep made its way out of related subcommittees of Ways and Means. Several arts organizations amplified the call to action on Thursday and Friday, noting that a vote was imminent. Indeed last Friday, the full Ways & Means Committee voted the rebalance package, including the $1.8 Trust swipe.

This "solution" was apparently stuffed into SB 581 after gutting the bill of its original contents (I haven't yet been able to determine what those were). This "gut and stuff" maneuver is not uncommon, however, and it explains why legislation moved so quickly, and also why some legislators weren't even aware of the sweep strategy until they received a high volume of complaints from Cultural Trust advocates and constituents of other affected programs.

McNitt reports that the Senate will vote on the proposed state budget today (Tuesday, March 3), and the House will vote on it by Friday. So keep those letters and emails going strong!

Now, let's assume for a moment that legislators are so desperate and confused about how to balance the budget that this proposal actually stands. In that scenario, you can expect some organizing from the CAC to re-structure the sweep into a loan payable back into the Trust, with interest. There are also some very smart lawyers looking at this, and building the case for why this is totally illegal: the state entered in a contract with the people who purchased Cultural Trust license plates. There was offer, acceptance, and consideration -- the three necessary components of a legally enforceable agreement.

Apparently these messages are all too complicated right now as legislators prepare to vote on a much more mind-boggling deficit. McNitt says that in the meantime arts advocates must continue to protest the funds sweep, and there will be another announcement from the CAC this afternoon or evening.

The advocacy is working, McNitt says. And even if the swept funds make it into the final budget, "We are building our leverage to create an alternative deal."

I will complain more later, but right now I need to get more people to take action.


~Christopher said...

I've just emailed the representatives from Salem.

MightyToyCannon said...

Thanks for giving us an update through a blog post which is probably the closest that Culture Shock has ever gotten to investigative journalism! I have more to say about advocacy efforts, but better focus now on writing more letters.

MightyToyCannon said...

I don't want your post to get pushed down the list too quickly, so am adding this news as a comment. The Arts Commission just reported that Economic Stimulus grants via the NEA are now open to proposals. In addition, Oregon's share of the funds for re-granting purposes comes to $307k plus change. Guidelines for how OAC will handle those funds are pending. Here's the info on the NEA share -- my quick perusal of the guidelines is that proposal will need to address how funds will help retain jobs or contractors who have been or will be laid of.

Application guidelines for direct NEA support through The Arts and the American Recovery and Reinvestment Act of 2009 are now available on the NEA's website:

The deadline to apply is 11:59 pm, April 2, 2009.

culturejock said...

Thanks for that, MTC. RACC has been tracking this too and was disappointed to learn that only those organizations that have received an NEA grant over the past four years are eligible to apply. So if you don't already have your foot in the door, you won't get in this way. But, RACC is developing a list of organizations that ARE eligible, and we will push this announcement out to all of them, and we will do anything we can to help them apply for these funds.

culturejock said...

With friends like the BEND BULLETIN, who needs help with being batshit crazy?


State lawmakers vs. cultural trust
Published: February 28. 2009 4:00AM PST

Tough times have a way of forcing tough questions. That isn’t a necessarily a bad thing, but the exercise can lead to bad decisions, as the Oregon Council for the Humanities has discovered.

The council’s problem begins, not surprisingly, with the economy.
Times being what they are, state tax collections have plummeted, and lawmakers are scrambling to make ends meet for the rest of the 2007-09 biennium. The effort involves some cutting, some reaching for federal money and some pirating of specialized accounts. One such account supports cultural organizations like the OCH, whose executive director has spotted the Legislature’s Jolly Roger on the horizon and sounded the alarm.

Lawmakers want to snatch $1.8 million from the Trust for Cultural Development Account, which is supported by individual and corporate contributions as well as revenues from the sale of “Oregon Cultural Trust” license plates. Cara Ungar-Gutierrez, executive director of the Oregon Council for the Humanities, acknowledges that the state’s budget needs to be balanced. However, she says, the state’s attempted raid on the cultural account is a “violation of (the) trust”
demonstrated by contributors, and therefore “unethical.” She’s right. People donated money to the trust, not to the general fund, and lawmakers should leave it there.

But they should feel free to eliminate the tax credit that encourages Oregonians to give money to the trust in the first place. The Legislature established the credit in 2001, and we have long considered it a bad idea. In fact, the existence of the credit is one reason the state feels so comfortable dipping into the trust, which despite the raid will contain about $10 million at the end of the biennium.

Oregon law allows individuals to claim an annual credit worth up to $500 for contributions to the cultural trust. Corporations can claim a credit of up to $2,500 per year. Tax credits are in incredibly powerful tool because people deduct them from their tax bills rather than their taxable income. Let’s say your tax bill comes to $2,000 and you’ve donated $500 to the cultural trust. You can deduct that $500 from your tax bill and pay only $1,500, according to Steve Bender, an analyst with the Legislative Fiscal Office. Thus, he says, “one could argue that while clearly donors express an intent that funds be placed in the trust, in many cases they are making that donation at no cost to themselves.” It’s a free donation for taxpayers.

But it isn’t free for all of the other programs the state general fund supports, most notably public education. Legally, says Bender, a tax credit is a designation of tax money. In effect, the hypothetical person described in the previous paragraph would be designating $500 of his $2,000 tax bill to the cultural trust. People and programs that rely upon the trust love this, naturally. But steering tax money in this fashion reduces the amount that goes elsewhere. During the current biennium, the credit’s impact on the state’s revenue stream is expected to be roughly $3.7 million — about twice the sum the Legislature now wants to take back.

We support the things the cultural trust funds, but let’s be honest:
They’re far, far less important than public schools, public safety and many other programs that rely upon state tax dollars. That’s why the tax credit ought to go, even though the money it has generated so far ought to stay where it is.

culturejock said...

Well the Senate has done the deed.

BOOS AND HISSES to Senate budget chief Margaret Carter, D-Portland, who said:

“There are those that are whining all over the place about ‘you cut this and you cut that,’” she said, wiping away mock tears during a speech on the Senate floor. “The fact is that we had to cut. That’s why I call this the shared cut and shared responsibility model.”

Don't you MOCK me with fake tears, lady. This isn't over.

MightyToyCannon said...

More reporting on this topic over at Portland Art Watch:

culturejock said...

Thanks to Willamette Week for covering this topic as well.

If you've written your legislator, you've probably gotten back a response by now that says "yeah we're sorry but times are hard." Please write back to make the point that stealing money from the TRUST is different than cutting other state programs. I recommend Bob Hick's very good 3-point argument at

I wish I had more of an update, but I haven't heard a peep from the Trust or their lobbyist today.

Anonymous said...

Denny Crane