When the Congress established the National Endowment for the Arts (NEA) in 1965, it required the agency to direct a portion of its funding to any state that established an agency to promote the arts. Today every state has such an arts agency, and, although the NEA continues to fund them, the bulk of these agencies’ revenues comes from state legislatures (in contrast to state humanities councils, which are funded largely by federal dollars; see Indicator IV-3, State Humanities Council Revenues).

Arts agency data are presented here because they offer a proxy for data on state humanities funding, which are not currently collected on a regular or comprehensive basis. These arts agency data are also of interest because some funding is used to subsidize activities that fall well within the scope of the humanities as that term is used by the Humanities Indicators Project. (See Statement of the Scope of the “Humanities” for Purposes of the Humanities Indicators.) For example, an examination of the grants made by New York’s state arts agency revealed that in FY 2006 approximately $5.2 million out of a total budget of $43 million supported literature and museum projects. In addition to the substantial monies distributed by the New York agency under these two general headings, numerous other grants went to fund activities that were clearly humanistic in their orientation, such as a presentation of material from Sufi texts accompanied by traditional music from the Indus Valley.

As Figure IV-6 reveals, the history of arts agency funding has been one of long stretches of steady growth followed by shorter periods of sharp decline. The first of these declines began in the early 1990s after 15 years of near constant growth. Between 1990 and 1993, funding levels decreased by 34%, from $435.3 million (in 2005 dollars) to $285.2 million. While the period between 1993 and 2001 saw another surge in funding—and one that brought state spending on the arts to record levels—three subsequent years of deep budget cuts quickly brought funding back down to its 1993 level. The last several years have seen increases in state appropriations to arts agencies. In 2007, these appropriations amounted to $340.9 million, an increase of 160% from 1974 but approximately 31% ($156 million) below the 2001 high.

Figure IV-6, Full Size Supporting Data