Drama over funding keeps arts community on the edge of its seat

Federal funding for the arts under the Reagan administration has long been a two-act drama with a largely happy ending for the arts community. For the past five years, the administration has sought drastic cuts in federal arts expenditures, while congressional opposition has held such spending steady. This year's funding debate, however, promises a different denouement. The Reagan budget proposals sent to Congress last week call for a reduction of more than $32 million in federal funding for the arts and humanities. In addition to the 12.5 percent cut in National Endowment for the Arts (NEA) funding and a 10 percent reduction in National Endowment for the Humanities (NEH) budget, the proposals also seek the virtual elimination of the $21 million Institute of Museum Services and a 98.5 percent cut in postal subsidies for nonprofit organizations, including arts institutions.

But the continuing debate over the controversial Gramm-Rudman-Hollings budget-balancing law has thrown many of those proposed cutbacks into question. Last week a special federal court struck down a key portion of the law as unconstitutional. Pending an appeal to the United States Supreme Court, however, the federal court ruling left intact the targets of the initial round of budget cuts, which constitute an across-the-board 4.3 percent reduction.

``Everyone is talking about Gramm-Rudman and concerned about the cuts,'' says Rep. Sidney R. Yates (D) of Illinois, chairman of the House appropriations subcommittee that has restored arts cuts in the past. ``Right now, it is almost impossible to determine how this will come out. At the moment it seems so chaotic.''

Despite the confusion, heads of most arts organization are braced for an initial March 1 round of budget cuts -- cuts that many observers concede could be sustained in the immediate future, but which throw into question the long-term health of nonprofit art. While federal endowment funds now constitute less than 5 percent of all spending on the arts nationwide, they remain the largest backer and the catalyst for an estimated $4.6 billion in private donations. ``By now everyone [in the arts community] has absorbed the idea of a 4.3 percent cut,'' says Anne Murphy, executive director of the American Arts Alliance, a nationwide arts consortium. ``But it's up to the arts community to make its case [to Congress] against further reductions.''

``The big difference this year is Gramm-Rudman,'' says Robert Lynch, executive director of the National Assembly of Local Arts Agencies. ``We're afraid that it will be used to push for cuts not officially mandated.''

Under the Reagan budget plan, which incorporates the 4.3 percent Gramm-Rudman reductions, the NEA budget would be cut from $165 million to about $145 million. Humanities funding would fall to $126.4 million from the current level of $140.6 million. Arts endowment officials predicted that such cuts would not cause major disruption to current NEA programs.

``The NEA is coming out a lot better than many other agencies targeted,'' says Francis S. M. Hodsoll, arts endowment chairman. ``We are in with the pack. We will continue to do well by the arts.''

Citing a general rise in state arts funding and private philanthropy, Mr. Hodsoll and other NEA officials insist that no arts programs would be eliminated under the proposed budget. Instead, most cuts would be passed along to those larger cultural institutions, such as symphony orchestras and opera companies, that have good access to additional outside funding. Other programs, such as in literature and folk and visual arts, would be cut less. Some institutions, including the Smithsonian Institution and the National Gallery of Art, would actually receive funding increases.

Despite such cautious public optimism at the NEA, many arts officials remain less sanguine about the future of the arts in America. ``Several orchestras already have very large deficits,'' says Don Fraher, director of government affairs for the American Symphony Orchestra League. ``With additional cuts in federal funding, we could see the elimination of community-outreach programs, shortening of rehearsal time, and maybe even cutbacks on entire seasons.''

``Museums are not going to close,'' says Larry Reger, executive director of the American Association of Museums. ``But there will be the hidden impact, the cutback in hours, in public programs, in the conservation of collections.''

In addition to these immediate repercussions, observers voiced concern over the long-term effect of declining federal subsidies. Any decrease in federal funds, critics say, entails a subsequent erosion of additional arts funding and jeopardizes nonprofit art in general.

``The main reason we object to federal cutbacks is because the NEA is a symbol, a Good Housekeeping seal of approval, that is looked at very carefully at the state and local funding level,'' says Mr. Lynch. ``Any cuts made at the federal level are translated locally.''

``We're really concerned about the commercialization of the nonprofit art world -- the emphasis on blockbuster museum shows, the transfer of a theatrical `product' to Broadway,'' adds Ms. Murphy. ``More and more we are losing the spirit of nonprofit art. That's the tragedy.''

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