Cultural funding down
After a nearly decade-long bonanza of giving to local cultural organizations and sports attractions, a government agency that depends on a sales tax is beginning to feel the pinch of the weakening economy.
The Allegheny Regional Asset District’s proposed $74 million budget for 2002 gives $1.3 million less than this year for capital improvement grants to help groups for projects like renovations and repairs. Operating budget allocations for the dozens of groups that have come to depend on annual RAD money will not drop.
Planners believe the cutback is prudent.
“If you look at the revenue projections, they are basically not expected to grow very much – certainly not like they had been growing,” said RAD Executive Director David Donahoe.
Over the years, RAD’s capital grants have gone to a cross-section of applicants – ranging from major renovations at the Pittsburgh Zoo & Aquarium to roof repairs and equipment purchases for smaller groups.
“They have largely been not for huge additions, but the kind of nuts-and-bolts things that these groups have a hard time finding money for from other sources,” Donahoe said.
RAD is expected to adopt a 2002 budget on Nov. 29. Crafted by government and community leaders in the early 1990s, RAD has been a boon to organizations by providing money to as many as 99 groups in one year.
The money comes primarily from a 1 percent countywide sales tax that piggybacks on the state’s 6 percent sales tax. RAD distributes half of the 1 percent for regional assets. The other half goes to Allegheny County and municipalities.
Just how much RAD will continue to get from sales tax becomes increasingly questionable in an uncertain economy.
This year is the first time in RAD’s history that sales taxes have dropped from the previous year. RAD collections through August were down at least 1 percent from last year.
The proposed budget of $74.3 million is $1.3 million below this year’s spending. Despite the drop in sales tax, however, RAD’s budget calls for increasing the amount of operation grants by $1.8 million.
To make ends meet, RAD is dipping into its reserve fund for an estimated $5 million or more through the end of next year. The reserve started 2001 at $23 million.
Donahoe said projections are being analyzed daily.
“We’re confident we are going to meet all our obligations this year, and very confident that, unless there is some enormous reversal, we will be able to meet those obligations (into the future).”
The size of the RAD pie – and how it is divided – has been a focus of debate since the district was formed nearly eight years ago.
While RAD proponents and critics agree that it has achieved valuable goals, some observers believe too much money has been earmarked for big-ticket items – such as construction of two new sports stadiums, leaving less money to divide among other attractions.
“What has happened is that a number of major facilities have gone after large chunks of this money. That’s not something we had anticipated and as a result doesn’t leave as much for small start-up arts and cultural groups,” said Joseph Sabino Mistick, who helped devise the RAD concept when he was an aide to former Pittsburgh Mayor Sophie Masloff.
Craig Kwiecinski, a spokesman for Mayor Tom Murphy, didn’t respond to a question concerning claims that the new stadiums consume substantial RAD money that was intended for other uses.
The Murphy administration devised Plan B, the funding package that financed the stadiums and expansion of the convention center.
RAD has agreements with 13 organizations that require giving a certain amount to those groups, including the Sports & Exhibition Authority to cover costs of the two new sports stadiums on the North Shore.
For example, RAD must make annual contributions of $13.4 million a year through 2030 to pay off the stadium debts incurred in building PNC Park and Heinz Field.
The remaining money is divvied up competitively among mostly smaller community groups.
From the start, more organizations have applied for grants than have received them.
Groups that do receive RAD funding are quick to express gratitude.
The International Poetry Forum in Oakland, which received preliminary approval for a $5,000 grant in 2002, is an example of the small cultural venues.
Program coordinator Christine Zoccole said RAD money helps the organization sustain an educational outreach program that enables poets to recite their work at public schools.
“Nonprofits don’t normally have large budgets, so when you get support, especially from the county that you are in, it’s important to us,” she said.
RAD funds also have been credited with making substantial improvements in county libraries.
The Allegheny County Library Association is slated to get $7 million next year.
“A number of the libraries wouldn’t even be open today if it weren’t for the RAD money,” said Marilyn A. Jenkins, the association’s executive director.
“The RAD money leverages additional state money, and it solidifies local government funding. The RAD clearly has resulted in a doubling of library funding for county libraries,” she said.
Richard Piacentini, executive director of Phipps Conservatory and Botanical Gardens, said RAD funds enabled the conservatory to establish year-round attractions and increase attendance by 65 percent over five years.
“We would never have been able to do that without that support,” he said.
Mistick, a Duquesne University law professor, said RAD has succeeded in achieving its main objective – “getting regional tax dollars into a pot that has been used for the support of regional assets.”
“We managed to sell this by citing the facilities that would be supported with this fund, and they were invariably city facilities that are immensely popular with people through the region,” he said.
Allegheny County Executive Jim Roddey said RAD’s “contributions to the cultural community have been appropriate.”
“Just because somebody has an idea doesn’t mean they should all be funded. I think organizations have to have a compelling reason (for funding).”
Roddey said that RAD funding, overall, has improved the county.
“All of those things ultimately contribute to the quality of life and our ability to attract companies and jobs.”
Jake Haulk, managing director of the Allegheny Institute for Public Policy, a think tank based on the North Side, said the RAD concept has achieved several of its original goals, but tax relief – which was tied into the enabling legislation – has received little more than token attention.
“The number of municipalities and school districts that actually rolled back taxes, following RAD, you can probably count on the fingers of one hand,” he said.
Haulk said that financing of new sports stadiums was a good example of RAD money being spent for unintended uses.
RAD originally aimed at helping fund operations at Three Rivers Stadium, not funding construction of other stadiums, he said.
“They get their hands on a big pot of money, and the next thing you know it is being spent on things for which it was never intended, and the taxpayers don’t see any tax relief,” Haulk said.
Allegheny County commissioners established the Regional Asset District in 1994, and the district adopted its first budget for 1995 – a $53 million spending plan that allocated money to 47 regional assets.
Here are the 2002 preliminary budget allocations from the projected $74.3 million budget:
RAD is obligated to pay the following agencies a certain amount based on agreements reached by RAD and the organizations.
These groups get grants from RAD on a competitive basis, based on requests.
Source: Allegheny Regional Asset District