On Monday, January 7, 2019, versions of the following letter were sent to FY2019 Community Investment Grant recipients in Levels IV, V, and VI. Please direct any questions to the Arts Commission at (602) 771-6502 or info@azarts.gov.

FY2019 Grantees: Arts Commission Funding Issue

Dear Grantee:

I am writing to inform you of an issue that has had a significant and unforeseen impact on the Arts Commission’s primary funding stream and current-year budget.

For the last 6 months, the Arizona Arts Trust Fund’s monthly receipts have posted well below our conservative projections and at lower levels than ever reported in the fund’s 30-year history.

We regret that this reality means we are unable to pay your grant in full at this time.

To honor as much of our commitment as possible, grantees from Community Investment Grant levels IV, V, and VI will be issued 90% awards according to the payment schedules published in CIG award agreements. When our third quarter closes, we will assess whether we can issue payments for the award balances.

It is appropriate to wonder how we arrived here. This AZ Capitol Times piece offers a fair summary: https://bit.ly/2At4et6. What the piece does not cover is that beyond the decrease in receipts, transitions at the Corporation Commission have also resulted in substantially-delayed funds transfers and responses to data requests.

For several months we have worked closely with our assigned analysts at the Governor’s Office of Strategic Planning and Budgeting and the Joint Legislative Budget Committee to assess changes in the fund. Most of you will remember that the Governor and Legislature increased the state arts budget by $500,000 this fiscal year, and that these funds were immediately committed to statewide arts grants. Given the historically reliable Arts Trust Fund and relative health of the economy, we never expected (and we don’t imagine our authorizers expected) we would find ourselves reconfiguring our current-year budget for a potential loss of $500,000 in revenue.

Please know that we took several actions before considering holding back 10% from grants not yet paid. All grant programs with rolling deadlines were placed on hiatus, and a second application cycle for AZ Creative Communities and other planned administrative expenditures were indefinitely postponed.

This notification also comes at a time when some of the Arts Commission’s other programs, funded through private partnerships, are expanding, and as we move into the next fiscal year’s cycle of grant applications and review. We are sorry for any confusion this may cause.

I would be pleased to answer your questions and explain the issue in greater detail. To that end, I will host a pair of webconferences for affected grantees next week and invite you to join me. If you have questions and are not able to join a webconference, please reach out via phone or email and Alex Nelson, Kristen Pierce Kent, Steve Wilcox, or I will connect with you.

In the meantime, thank you for your partnership and understanding.

Sincerely,

Jaime Dempsey
Executive Director
Arizona Commission on the Arts