ADMINISTRATIVE REPORT

Date: February 1, 2000
Author/Local: AN/6007

RTS No. 01232

CC File No. 2051

CS&B: February 17, 2000

TO:	Standing Committee on City Services and Budgets
FROM:	Director, Office of Cultural Affairs
SUBJECT:	2000 Cultural Grants Budget Ceiling

RECOMMENDATION

THAT Council approve a 2000 Cultural Grants budget of $3,103,500 as outlined in summary Table 1, subject to Council approval of the 2000 operating budget.

COMMENTS

The General Manager of Community Services RECOMMENDS approval of the foregoing.

CITY MANAGER’S COMMENTS

The City Manager notes that the grant budgets are within initial development guidelines which includes a 1% increase over 1999. This may not be achievable in the final budget, as a Council decision on tax increases has not been made. Therefore, the final budget may need to be modified.

POLICY

Council established the annual civic grants program in March 1978. Budget ceilings for the Cultural Grants program are approved annually.

PURPOSE

As summarized in the Director of Finance’s cover report, the purpose of this report is to establish a budget ceiling for the 2000 Cultural Grants budget, which consists of five categories: Operating, Project, Diversity Initiatives, Organizational Development and Theatre Rental grants.

SUMMARY

As advised by the Director of Finance, staff are submitting a 2000 Cultural Grants budget ceiling of $3,103,500 which represents a 1% inflationary increase over the 1999 Cultural Grants budget. Funds within this ceiling are distributed among grant categories as summarized in Table 1.

Table 1
2000 Cultural Grants Budget

Grant Category	1999 Original Approved	1999 Actual Approved	2000 Budget Recommended
Operating	$1,262,140	$1,248,400	$1,275,500
Project	$84,000	$97,740	$90,000
Diversity Initiatives	$60,000	$65,500	$60,000
Organizational Development	$25,000	$19,500	$20,000
Theatre Rental	$1,584,035	$1,584,035	$1,658,000*
TOTAL	$3,015,175	$3,015,175	$3,103,500

* Includes a deferred $59,000 adjustment for the 4% Civic Theatre rental rate increase implemented in Fall 1999, approved by Council on June 1, 1999.

BACKGROUND

The City’s Cultural grants to non-profit arts organizations play a valuable role in ensuring the vitality, diversity, and accessibility of the arts in our community. Operating, Project, and Theatre Rental grants assist with the creation, production, and presentation of local artists’ work, and also help provide opportunities for Vancouver residents to experience the work of artists from around the world. Diversity Initiative grants support the development of art and artists from distinct communities, and encourage intercultural activities. Organizational Development grants contribute to organizational renewal and strategic initiatives.

This year, 114 Operating and Project grant applications totalling $1,734,500 have been received; applications in the other grant categories are due later in the year. Table 2 provides an overview of current requests compared with those in previous years (the statistics for 2000 only include applications for the first of two Project deadlines).

Table 2
Operating and Project Grant Applications

	1996	1997	1998	1999	2000*
Applications received:
Funded in previous year	109	103	99	98	96
Turned down in previous year	15	9	14	6	2
New applicants	19	24	19	27	16
Total requests	143	136	132	131	114*

* Requests for first Project deadline only.

DISCUSSION

For 1999, Council approved a final Cultural Grants budget totalling $3,015,175. Since the Director of Finance advises that the 2000 budget figures are to include a 1% adjustment for inflation, staff are submitting a Cultural Grants budget ceiling of $3,103,500. As described in the section on Theatre Rental grants, this amount includes an adjustment in the Theatre Rental grants category to reflect the 4% Civic Theatre rental rate increase implemented in Fall 1999.

Within the Cultural Grants budget ceiling, funds are allocated to the different categories as summarized in Table 1 and detailed in the following sections. The distribution is based on anticipated needs, and on current priorities for supporting stability in the cultural sector, while assisting some new applicants and activities.

Operating Grants

Operating Grants contribute to the financial stability that arts organizations need over the long-term to maintain quality programming, and to secure support from other public sector funders. To be considered for an Operating grant, an organization must have a track record of competent management and artistic achievement, a diversified revenue base, and ongoing presence in the community. To qualify, applicants must also have received civic Project funding for at least two consecutive years.
This year the City has received 85 Operating grant requests totalling $1,553,500 which includes 11 applications from groups previously in the Project category. A number of these
applicants may be referred back to the Project category if staff review indicates that they do not meet Operating category requirements. Staff recommend a Operating Grants budget of $1,275,500.

Project Grants

Project grants are intended for one-time initiatives, new applicants, organizations working on a project basis, and those whose activities are only partly eligible for civic funding. To provide greater flexibility for smaller arts groups, there are two application deadlines in this category, one in December, in tandem with Operating grants, and the other in June. For the December deadline, the City has received 29 Project grants requests totalling $181,000. Staff recommend a budget of $90,000 in this category.

Diversity Initiatives Grants

This grant program is designed to help build artistic capacity in distinct communities, as defined by race, ethnicity, or disability. It assists with artistic leadership training, developmental projects by groups from distinct communities, and cross-cultural artistic collaborations. While grants totalling $65,500 were approved in 1999, staff recommend a budget at last year’s original $60,000 level, believing that the number of requests after program’s first two years will level off.

Organizational Development

Organizational change and renewal have become increasingly important in the cultural sector as it responds to increased competition for audiences in a global economy; to budget cuts and new priorities among public and private sector funders; and to the opportunities presented by new technologies. Organizational Development grants help arts organizations upgrade staff skills, secure the expertise they need to address specific operational problems, undertake long-range planning, and develop collaborative audience development initiatives.

Of the $20,000 recommended for this category, staff propose that $15,000 be designated as the City’s contribution to the cultural component of the Arts Partners in Organizational Development program (ArtsPOD), and the balance for arts administration training and innovative audience development collaborations. Established in 1989 by the City and Vancouver Foundation, the POD program helps non-profit groups identify organizational problems and develop strategies to address them. Last year Arts POD was also supported by the B.C. Arts Council and Department of Canadian Heritage.

Theatre Rental Grants

Theatre Rental grants are provided to Council-designated arts organizations that regularly use one of the three Civic Theatres: the Orpheum, Vancouver Playhouse and Queen Elizabeth theatres. Council approves a “base level” of rental grant uses to organizations accepted into this program (currently 12 groups), which gives them a predictable annual level of support.

Council approved the current timetable and process for these grants on July 27, 1995, providing for an allocation report in the summer of each year, prior to the performing arts season. The budget ceiling for these grants is established at the same time as the rest of the Cultural Grants budget, and increased later in the year to address additional rental grant costs related to any Civic Theatre rental rate increases, which are implemented in the Fall.

Last year, because several rental grant applicants changed their 1999/00 performance seasons, scheduling fewer performances in Fall ‘99 and more in Spring ‘00, the usual adjustment that factors the Civic Theatres rental rate increase into the Theatre Rental grants budget was not immediately required, and was deferred to this year. Staff estimate that a $59,000 budget adjustment reflecting the 4% rental rate increase in 1999 will be needed to address eligible rental grant uses this year, and are recommending a Theatre Rental Grant budget of $1,658,000, which includes the 4% adjustment, and the 1% inflation increase indicated by the Director of Finance.

As described in the Director of Finance’s cover report on civic grant budget ceilings, the Theatre Rental Grant budget includes the annual $100,000 allocation for the Vancouver Symphony’s office space rental in the Orpheum.

CONCLUSION

The budget ceiling and distribution of funds among categories recommended in this report reflect the ongoing importance of the City’s Cultural Grant programs in supporting the fiscal stability and cultural infrastructure necessary for a healthy cultural sector. They also reflect the desirability of providing strategic support for artistic development in distinct communities, for innovation, and for new creations, all of which contribute to the broad range of choices available to Vancouver residents. The Cultural Grant budget also provides for assistance with the organizational renewal that enables arts organizations to respond to the challenges presented by the our society’s rapid economic, social, and technological changes.

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(c) 1998 City of Vancouver