Arts Funding Snapshot 2006: Vital Signs

Published in: GIA Reader, Vol 19, No 2 (Summer 2008)

Steven Lawrence

Highlights

The Foundation Center offers these key findings from GIA’s eighth snapshot of foundation giving to arts and culture. The definition of arts and culture used for this snapshot is based on the National Taxonomy of Exempt Entities and encompasses funding for the performing arts, museums, visual arts, multidisciplinary arts, media and communications, humanities, and historical societies/historical preservation. Most importantly the findings tell us about the changes in foundation giving for the arts between 2005 and 2006 and the distribution of 2006 giving among arts and cultural institutions and fields of activity. They are based on arts grants of $10,000 or more reported to the Foundation Center by 1,263 of the largest U.S. foundations, hereafter referred to as “the sample.”1 The Center has conducted annual examinations of the giving patterns of the nation’s largest foundations for three decades.

Foundation funding for arts and culture grew strongly in 2006, although overall giving rose faster. Unadjusted grant dollars awarded for arts and culture by the 1,263 larger foundations in the sample increased by $275.1 million, from $2.05 billion in 2005 to $2.33 billion in 2006.2 This 13.4 percent gain, or 10 percent after inflation, followed a roughly 4 percent rise in unadjusted giving in 2005. Nonetheless, the latest year’s growth fell below the 16.4 percent unadjusted increase in all funding reported for these foundations — the second consecutive year that arts giving grew more slowly. However, the growth in arts grant dollars was faster than for six of the nine other major funding areas.

The proportion of foundation grantmaking for arts and culture decreased slightly. The arts and culture share of total grant dollars from the 1,263 larger foundations in the sample was 12.2 percent in 2006, down slightly from 12.5 percent in 2005. This share of grant dollars was marginally less than the average share (12.7 percent) and the median share (12.5 percent) for the past decade. By region, the 2006 shares varied from 16.2 percent for foundations in the Northeast to 8.1 percent for grantmakers in the West.

Most larger foundations support arts and culture, while more than half show a strong commitment to the arts. More than four out of every five (81.2 percent) of the larger 1,263 foundations made grants supporting the arts and culture in 2006. Committed arts funders — i.e., those providing at least 10 percent of their 2006 giving for the arts — represented over half of sampled arts funders (55.4 percent).

The size of the median arts grant remained unchanged, while the number of arts and culture grants increased faster than the overall number of grants. The median arts and culture grant size — $25,000 — did not change from 2005 to 2006, although the real value of the median grant decreased slightly due to inflation. This value also matched the median amount for all foundation grants in the latest year and has not changed since 1993. The number of arts grants in the sample increased by 1,397, from 18,698 in 2005 to 20,095 in 2006. This 7.5 percent increase slightly exceeded the 7.3 percent growth in the overall number of grants reported in the sample.

Large grants represent close to three-fifths of all grant dollars. Large arts grants of $500,000 and more captured just over 58 percent of total grant dollars for the arts in the 2006 sample, up from roughly 55 percent in 2005. Nonetheless, they are concentrated in a relatively small share (3.9 percent) of the total number of grants.

Operating support accounted for a smaller share of arts funding than in the prior year. In 2006, general operating support accounted for 22.7 percent of arts and culture grant dollars, down from 26.9 percent in 2005. However, just 13 percent of arts grant dollars in 1989 provided operating support, and 2006 grant dollars for general operating support represented a higher percentage for arts and culture than for many other fields.

Top arts funders represented a larger share of overall giving. The top 25 arts funders by giving amount provided 36.7 percent of total foundation arts dollars in 2006, up from 34.3 percent in 2005. Nonetheless, the share of arts giving accounted for by the top funders has remained roughly consistent since the end of the 1990s. By comparison, the top 25 arts funders accounted for more than 50 percent of giving in the early 1980s.

Please note

It is important to keep in mind that the foundation grantmaking examined here represents only one source of arts financing. It does not examine arts support from earned income, governments, individual donors, or the business community. This analysis also looks only at foundation arts support for nonprofit organizations, and not for individual artists, commercial arts enterprises, or informal and unincorporated activities.

Specific Findings

Arts Grants Compared to All Grants in the Sample

Overall foundation dollars for the arts. Unadjusted grant dollars for arts and culture from the 1,263 larger foundations in the Foundation Center’s sample increased by $275.1 million, from $2.05 billion in 2005 to $2.33 billion in 2006.3


Funding for arts and culture increased 13.4 percent before inflation between 2005 and 2006. (With an inflation rate of more than 3 percent, this reflected a real increase of 10 percent.) While this gain fell below the 16.4 percent increase in unadjusted funding reported for foundations in the sample overall, it surpassed six of the nine other major funding areas (figure 1).


The arts’ share of all foundation grant dollars. In 2006, arts grant dollars represented 12.2 percent of all grant dollars in the Foundation Center sample (figure 2). This percentage was slightly lower than the arts’ 2005 share and the 12.7 percent average share and 12.5 percent median share for the past decade (figure 3). From 1996 through 2006, the arts’ share of all foundation grant dollars ranged from lows of 12 percent in 1996 and 2000 to a high of 14.8 percent in 1998.


The impact of exceptionally large grants. Every year and in all funding areas, a few very large grants can skew overall totals, creating distortions in long-term grantmaking trends. In 2006, 18 arts and culture grants totaled at least $10 million, and instances where these grants had a notable impact on grantmaking patterns are identified in the following analyses. Yet despite the potential fluctuations caused by these exceptional grants, Foundation Center data in all fields have always included them, providing consistency over time. (In addition, the Foundation Center provides statistics based on share of number of grants, which are not skewed by exceptionally large grants.)

Arts funding by region. Foundations in the Northeast provided a larger share of their overall 2006 giving for arts and culture (16.2 percent) than did foundations in other regions. The Northeast was followed by the Midwest (13.0 percent), South (11.8 percent), and West (8.1 percent) regions of the United States. Nonetheless, between 2001 and 2006, giving for arts and culture grew slightly faster among foundations in the Midwest (up 22.8 percent) and West (up 22 percent), compared to those in the Northeast (up 20.3 percent). Foundations located in the South showed a far more modest rate of growth in arts and culture giving (up 3.9 percent).

Organizations in the Northeast and Midwest received the largest share of arts grant dollars out of overall giving (15.0 percent each), followed by those in the West (14.0 percent) and South (9.5 percent). In addition, 4.2 percent of grant dollars funding organizations located outside of the United States supported the arts. Interestingly, arts and culture giving to Western recipients rose at a much faster rate between 2001 and 2006 (up 47.3 percent) than did support for recipients in the Midwest (up 19 percent) and Northeast (up 15.3 percent). Over the same period, arts grant dollars for Southern recipients declined 6.5 percent.


Number of grants. In terms of the number of foundation grants given rather than the total dollar amount, the arts’ share of all foundation grants was unchanged at 14.3 percent in 2006 (figure 4). The actual number of grants increased by 1,397, from 18,698 to 20,095 — the highest number of arts and culture grants tracked for a single year in the sample.

Share of foundations funding the arts. In the 2006 sample, about 81 percent of funders supported arts and culture — 1,025 of the 1,263 foundations. However, some of these foundations do not maintain a consistent commitment to the arts. Among sampled arts funders showing a stronger commitment to the arts, close to three-fifths (568) provided at least 10 percent of their 2006 grant dollars for the arts, while over one-fifth (220) gave 25 percent or more.

Grants by arts subfield


Funding for the performing arts accounted for over one-third (35 percent) of all foundation arts dollars in 2006 (figure 5), surpassing the share reported for museums (31 percent). From the start of the 1980s until 1998, the performing arts consistently received more foundation support than museums. However, museums have surpassed the performing arts by share in several recent years (1998, 1999, 2001, 2004, and 2005). More study would be needed to adequately understand the underlying reasons for the shifts in share between these two fields of activity, for example, the entry onto the scene of new and large arts funders, extraordinarily large grants, the contribution of valuable art collections, and new capital projects at museums.

Giving to performing arts. In 2006, performing arts grant dollars increased by nearly 26 percent, from $641.6 million to $807.7 million. Contributing to the increase in giving was a $50 million grant from the Donald W. Reynolds Foundation to the Las Vegas Performing Arts Center Foundation for the Fred W. and Mary B. Smith Center for the Performing Arts.


The largest share of giving to the performing arts (figure 6) supported the performing arts generally (including performing arts centers and education), followed by music (including symphony orchestras and opera), theater, and dance. The performing arts received more funding than museums in 2006 based on share of arts grant dollars, as well as share of number of arts grants (41.1 percent vs. 20.9 percent). In general, the average performing arts grant tends to be smaller in size than the average museum grant. In 2006, 63 percent of all funders in the Foundation Center sample supported the performing arts.


Giving to museums. Grant dollars allocated to museums increased by 4.1 percent between 2005 and 2006, from $682.7 million to $710.9 million. The number of grants increased by 5.1 percent, from 3,994 to 4,196. Among museum types (figure 7), the largest share of 2006 funding supported art museums (56.4 percent), although this share was slightly lower than in the previous year (57.8 percent). Nonetheless, actual grant dollars for art museums rose between 2005 and 2006. Grant dollars also increased between 2005 and 2006 for multipurpose museums,4 children’s museums and other specialized museums,5 ethnic/folk arts museums, marine/maritime museums, natural history/natural science museums, and sports/hobby museums. By comparison, grant dollars decreased for history museums and science and technology museums. In the Foundation Center’s 2006 sample, 60 percent of all funders supported museum activities.

Giving to multidisciplinary arts. The share of arts giving for multidisciplinary arts6 remained nearly unchanged at 9.2 percent in 2006. Actual grant dollars for these activities rose 18.7 percent, from $180.1 million to $213.7 million. The number of multidisciplinary arts grants also increased, from 2,215 to 2,527. This growth followed two consecutive years of decreases in total grant dollars supporting multidisciplinary arts.

Giving to media and communications. Support for media and communications7 represented 7.6 percent of arts funding in 2006, up slightly from 7 percent in 2005. Actual grant dollars rose 11.8 percent, from $157.9 million to $176.5 million. Five grants of at least $2.5 million were made in the media and communications field in 2006, down from ten in the previous year.

Giving to the visual arts. Support for the visual arts and architecture jumped 67.1 percent in the latest year, from $100.3 million to $167.6 million — the highest amount on record. This growth was almost entirely attributable to a $60 million gift of contemporary drawings from the Judith Rothschild Foundation to New York’s Museum of Modern Art.8

Giving to historic preservation. Support for historic preservation decreased by close to 13 percent in 2006, from $128.4 million to $112.1 million. By comparison, the number of historic preservation grants increased 4.2 percent, from 1,256 to 1,309. However, this total remained below the peak of 1,325 historic preservation grants reported in 2000.

Giving to the humanities. Funding for the humanities9 totaled less than 4 percent of arts grant dollars in 2006, down from 5 percent in 2005 and 6 percent in 2004 and 2003. Actual humanities grant dollars decreased by 9.6 percent in the latest year. The number of humanities grants also declined by 3.5 percent, from 810 to 782.10

Grants by types of support

An important caveat to a report on the allocation of foundation dollars by specific types of support is that, for roughly 22 percent of arts grant dollars in the 2006 Foundation Center sample, the type of support could not be identified. This means that modest differences in percentages — that is, variations under 10 percent — may not be reliable. (The grant records available to the Foundation Center often lack the information necessary to identify the type of support. For example, it is often the case that the only source of data for this sample on foundations’ grants is the 990-PF tax return, and this tends to be less complete than other forms of grant reporting.)


The arts compared to other foundation fields of giving. The three largest categories of support tracked by the Foundation Center are program support, capital support, and general operating support. See figure 8 for a comparison in these three categories of dollars going to arts and culture with grant dollars going to other major foundation subject areas.

Of the three main categories of support, special programs and projects typically receive the largest share of arts and culture grant dollars and grants. In fact, the same is true in most of the major fields, such as health and education, where program support consistently accounts for the largest share of funding. In 2006, program support represented 32.9 percent of arts and culture grant dollars and 36.1 percent of the number of grants.

Capital support accounted for the second largest share of arts grant dollars in 2006 (31.5 percent), after representing the largest shares in 2004 and 2005. Grants for capital support are larger on average than awards for program and general operating support, and exceptionally large capital grants can have a pronounced effect on the distribution of funding by type of support. In fact, arts dollars allocated to capital support have fluctuated more than arts dollars to the other two primary categories of support: in 1986 the share allocated to capital was about 44 percent; in 1993 it was about 30 percent; and in 1999 it was about 41 percent. (In general, the share of capital support is highest in periods of strong foundation asset growth.)

Grant dollars allocated for general operating support in 2006 were higher for arts and culture (22.7 percent) than for many other fields. Nonetheless, this share was down from the nearly 27 percent share reported in 2005. The share of number of operating support grants also decreased between 2005 and 2006, although the reduction was far more modest (from 33.3 percent to 32 percent.) Despite the smaller share of arts giving targeting operating support in 2006, the portion of grant dollars allocated to this type of support has grown markedly in the last roughly seventeen years; operating support represented only 13 percent of arts funding in 1989.

Arts grants by specific types of support. Table 1 provides a breakdown of more specific types of support within the larger support categories and lists both the specific dollar value and number of grants made in each type. As with all data in the Snapshot, it is important to keep in mind that this table includes only grants of $10,000 or more awarded to organizations by a sample of 1,263 larger foundations. It is also important to note that for nearly 22 percent of the arts grant dollars in this sample, the type of support was not specified.


Grants by grant size

Median grant size. The median or “typical” grant amount11 for arts and culture in 2006 was $25,000, which matched the median amount for all foundation grants. This amount has remained unchanged since 1993. If this amount were adjusted for inflation, however, it would have lost value in real dollars. More study would be required to determine whether the unchanged median means that foundation arts grants simply are not keeping pace with inflation, or whether, in combination with the increased number of grants, it means that foundations are choosing to distribute funds more broadly to a larger number of recipients.

Small and mid-sized grants. Two-thirds (66.1 percent) of all arts grants in the 2006 sample were for amounts between $10,000 and $49,999 table 2), slightly more than the 2005 share. By comparison, the share of mid-sized arts grants ($50,000 to $499,999) decreased slightly to 30 percent.


Large grants. The share of larger arts grants ($500,000 and over) remained nearly unchanged over the same period: larger grants represented 3.9 percent of the total number of arts grants in 2006, compared to 3.8 percent in 2005. However, their share of total grant dollars increased from 54.9 percent to 58.2 percent. Overall, foundations in the sample made 103 arts grants of at least $2.5 million in 2006, up from 97 in 2005 and 71 in 2004.

In addition to the $61.4 million grant from the Judith Rothschild Foundation to the Museum of Modern Art and the $50 million grant from the Donald W. Reynolds Foundation to the Las Vegas Performing Arts Foundation, examples of other especially large 2006 grants included a $22.3 million continuing support award from the Freedom Forum to the Freedom Forum Newseum, a $15 million grant from the Annenberg Foundation to the Philadelphia Orchestra Association for its Fund for Technology, and the Starr Foundation’s $15 million award to Lincoln Center for the Performing Arts for the renovation of the Alice Tully Performance Space.

The 25 largest arts funders. The top 25 arts funders by giving amount provided close to 37 percent of the total arts dollars in the Foundation Center’s 2006 sample (table 3), up from 34.3 percent in 2005. Overall, the share of giving accounted for by the top 25 arts funders has remained fairly consistent at between 33 and 39 percent since the end of the 1990s. While the share recorded for the latest year remains substantial, in the early 1980s the top 25 arts funders accounted for more than half of the grant dollars in the sample. This suggests that the base of large arts funders has widened since that time, making arts funding less concentrated among a small number of foundations.




Top foundations by share of arts giving out of overall giving. Of the foundations that committed large percentages of their grant dollars to arts and culture, many are the smaller foundations in the sample (table 4). Among the top 100 foundations ranked by share of arts giving out of total giving, 62 foundations gave less than $5 million in total arts grant dollars in 2006. This number would be greater if grants of less than $10,000 were included, because some arts funders will either primarily or exclusively award arts grants of less than $10,000 each.

Arts giving by the 25 largest funders overall. Among the 25 largest foundations by overall giving in the sample, only one made no grants for arts and culture in 2006 (table 5). Nonetheless, levels of arts funding varied widely, with 11 foundations allocating at least 10 percent of their overall giving for the arts, while six provided 1 percent or less.


Support for International Cultural Exchange

Grantmakers included in Foundation Center’s 2006 grants sample provided 51 grants totaling $18,299,783 with a primary purpose of international cultural exchange. If grants with a secondary purpose of international cultural exchange are included, the figures rise to 315 grants totaling $41,459,651. Beyond these summary statistics, the Robert Sterling Clark Foundation has commissioned a detailed report examining support for cultural diplomacy in the post-9/11 context, which will be published in Fall 2008.

Corporate Foundation Giving for Arts and Culture

They following analyses are based on arts grants of $10,000 or more reported to the Foundation Center by 200 of the largest U.S. corporate foundations. Findings do not reflect direct corporate giving, which accounts for the majority of charitable contributions by U.S. corporations.

Corporate foundations represent an important source of support for arts and culture. While corporate foundations account for less than 4 percent of U.S. private and community foundations, the larger corporate foundations included in the 2006 grants sample provided close to 11 percent of grant dollars for the arts (figure C1). Actual grant dollars totaled $247.1 million. By number, corporate foundations allocated 4,364 grants, or close to 22 percent of the overall number of arts grants in 2006. The median corporate foundation arts grant equaled $20,000, less than the $25,000 median amount reported for foundation arts funding overall.



Compared to a decade ago, corporate foundations have reduced the share of their overall giving targeting the arts. In 2006, corporate foundations provided 12.4 percent of their grant dollars for arts and culture (figure C2), down from 14.2 percent in 1996. However, the decrease in share was not a consistent trend throughout this period. In fact, corporate foundations increased the share of their giving supporting the arts steadily in the late 1990s, reaching 15.3 percent in 2000. The share then declined to a low of 11.4 percent in 2005. Over the entire period, corporate foundation giving for arts and culture represented an average of 13.5 percent of their total giving.

Museum activities benefited from the largest share of corporate foundation giving. Reversing the overall pattern of arts and culture giving in 2006, corporate foundations provided a larger share of their grant dollars for museums (37 percent) than the performing arts (32.5 percent). They also directed bigger shares of their giving for multidisciplinary arts and historical activities than all private and community foundations, while providing smaller shares for media and communications, the humanities, and the visual arts (figure C3).



Footnotes

  1. 1. Source of the data. The original research upon which this report is based was conducted by the Foundation Center. Specifically, the source for data was the Foundation Center’s Foundation Giving Trends: Update on Funding Priorities (2008) report and the grants sample database. The data for 2006 include all grants of $10,000 or more awarded by 1,263 of the largest U.S. foundations and reported to the Foundation Center between June 2006 and July 2007. Grants were awarded primarily in 2006. These grants represented half of total grant dollars awarded by the more than 72,000 active U.S. independent, corporate, and community foundations that the Foundation Center tracks. (The sample captures roughly half of all foundation giving for arts and culture.) For community foundations, only discretionary and donor-advised grants were included. Grants to individuals were not included.
  2. “Unadjusted grant dollars” refers to the value of giving before inflation is taken into account. Adjusting for inflation allows for more accurate comparisons of changes in giving, as inflation-adjusted figures reflect actual buying power at different points in time.
  3. In addition to the more than $2.3 billion supporting the arts in 2006, foundations in the sample provided 105 grants totaling $16,235,304 for arts and humanities library programs, and 51 grants totaling $18,299,783 for international cultural exchange. (For more details, see “Support for International Cultural Exchange”.)
  4. Includes museums such as the Smithsonian Institution and general-purpose museum programs.
  5. Includes maritime, sports, and hobby museums and specialized museums.
  6. Includes support for multidisciplinary centers, ethnic/folk arts, arts education, and arts councils. For a detailed analysis of foundation funding for arts education, see L. Renz and J. Atienza, Foundation Funding for Arts Education, New York: Foundation Center, 2005.
  7. Includes support for production and dissemination of one or more media forms including film/video, television, radio, and print publishing; support also for journalism and communications centers.
  8. Grants in the form of artwork given are coded for the type of art given, if this information is available.
  9. Includes support for archeology, art history, modern and classical languages, philosophy, ethics, theology, and comparative religion.
  10. For a detailed analysis of foundation humanities support, see L. Renz and S. Lawrence, Foundation Funding for the Humanities, New York: Foundation Center, 2004.
  11. The median — meaning that half of the grants are above and half are below the amount — is generally acknowledged to be a more representative measure of the typical grant than the mean or “average,” because the median is not influenced by extreme high or low amounts.

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