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Discussions about city funding for the arts are likely to overuse words like should, must, and ought to and underuse words like do. According to those frustrated with the city’s current actions and inaction, Santa Fe should give more money to developing arts organizations, must actively foster nightlife to appeal to and maintain a young demographic, and ought to focus more resources on easing the financial burdens of struggling artists. The other side says the city should incentivize small business to develop an economy more conducive to the arts, must be fiscally cautious and limit unessential expenditures, and ought to focus its energies on other issues: education, income inequality, and crime.

In late January, City Councilor Rebecca Wurzburger proposed a resolution to establish a Nighttime Economy Task Force as well as a pilot program to award up to $5,000 to projects aimed at “invigorating the nighttime economy.” Following a series of committee reviews, the proposal is slated for a Feb. 26 City Council vote. Though indirectly targeted at the arts, as related to nightlife, this is the most recent of the “shoulds” added to the conversation — and, coming in the form of a sponsored City Council resolution, it is perhaps the most likely “should” to join that second, smaller category of things the city actually does.

What does the city currently do? By far the most prominent example of city-sponsored arts-related funding is the Santa Fe Arts Commission grants program. This complex and much-discussed funding program — multiple programs, actually — is frequently misunderstood. With the application cycle for the 2014 fiscal year open and set to close at 5 p.m. Thursday, March 6, it is the aim of this article to explain the various grant categories and eligibility requirements.

Established in 1987, the Santa Fe Arts Commission is charged with a number of duties. These include overseeing the Art in Public Places program, the Community Gallery in the Santa Fe Community Convention Center, the Creative Tourism program and website, the annual Mayor’s Awards for Excellence in the Arts, and, arguably most important, grant programs that have provided around $20 million to nonprofit organizations since 1987. The grants are divided among three programs.

The first two programsare funded by the 1% Lodgers’ Tax, a tax on commercial lodging authorized by city ordinance to be used for nonprofit arts promotion and advertisement. These programs are designed to support a cyclical, tourism-based economy. As stated in the city’s official description of the funding programs, recipients “must play a role in promoting tourism and apply the funding received primarily toward the project’s promotional, advertising, and marketing costs.” The largest of the two programs backed by the lodgers’ tax, both in terms of applicants and funds awarded, is the Community Arts Promotion Program (CAPP). According to data from the last eight fiscal years, the top CAPP grantee has been the Santa Fe Opera, receiving as much as $124,887 in fiscal year 2008-2009, down to $68,100 in the most recent fiscal year. Such fluctuations directly reflect the yearly rise and fall of Santa Fe’s tourist economy.

In keeping with the program’s emphasis on marketing, the Santa Fe Opera’s $100,000 request for 2012-2013 itemized $50,000 for printing costs, $20,000 for promotional design and production, $20,000 for advertising placements, and $10,000 for contracted marketing and promotion. Other repeat CAPP recipients include the Santa Fe Chamber Music Festival ($79,537 in 2008-2009) and the Georgia O’Keeffe Museum ($62,963 the same year).

To be eligible for CAPP money, an organization must have received Arts Commission funding in the other lodgers’ tax program — the Special & New Projects Program (SNPP) — for at least two years. This is in addition to meeting the eligibility requirements for all Arts Commission programs: an applicant must be a Santa Fe-based arts organization with a two-year history of having a 501(c)(3) designation and be incorporated in the state. Groups or individuals that do not meet these requirements may apply through a fiscal agent that does.

As its name indicates, SNPP considers special and new projects in addition to established programming. Being funded by the lodgers’ tax, it too is designed to promote tourism. For 2013-2014, Parallel Studios (producer of the Currents New Media Festival) received the highest amount given that year: $8,500. In its application, Parallel Studios requested the maximum of $10,000 — CAPP’slimit is exactly 10 times that at present — half for marketing and public relations, and the other half for administrative salaries and benefits. In 2013-2014, SNPP recipients netted a total of $36,500 in lodgers’ tax funds, compared with $671,250 for CAPP recipients.

The last of the three Arts Commission programs may be aimed at countering the tourism-centric focus of the lodgers’ tax grants. The Community Arts Development (CAD) program is financed through the Quality of Life Fund, which is paid for with gross receipts taxes. The award is for organizations that “provide arts services to the local community, with an emphasis on projects that bring the community together to celebrate the diversity of artistic heritage.” The National Dance Institute of New Mexico was awarded the second-highest grant in this category for 2013-2014, receiving $4,250 (behind Outside In’s $6,500 award). Because CAD does not prioritize marketing and promotions, NDI’s $6,000 request was entirely devoted to artistic salaries and benefits. Total CAD funding last year was $42,250.

One final difference between the categories is that CAD recipients can renew their contracts for a second year if they meet the requirements, whereas SNPP and CAPP recipients must reapply annually. In the most recent funding cycle, 67 eligible organizations applied across all three programs, and 54 received funding, according to Debra Garcia y Griego, Arts Commission director.

To clarify: the reason the Santa Fe Opera receives the lodgers’ tax funding and NDI does not involves tourism. Visitors from Albuquerque, Dallas, and Beijing are presumed more likely to attend the opera than an NDI performance.

Who decides which organizations get what? Next week’s column will deal with the review process, the arts commissioners, and how the funds are actually used. We’ll also hear feedback from supporters and detractors alike. ◀

Contact Loren Bienvenu at lbienvenu@sfnewmexican.com. Interested applicants may contact the Santa Fe Arts Commission at 505-955-6707 to learn more about eligibility requirements and funding programs. The online-only application is available at http://santafenm.culturegrants.org.