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The Shaky Future of Denver Arts and Culture Funding

Nonprofit dance company Wonderbound is one of hundreds of cultural organizations in Denver navigating the COVID-19 shutdown.EXPAND
Nonprofit dance company Wonderbound is one of hundreds of cultural organizations in Denver navigating the COVID-19 shutdown.
Martha Wirth
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“It’s a crazy time,” says Gary Steuer, head of the Bonfils-Stanton Foundation, one of the biggest arts and culture funders in Denver. “If you’re in the privileged position of philanthropy and running a private foundation, these are those times when it’s your obligation to step up and figure out: What is the role you can play in helping in this crisis?”

When COVID-19 closures swept Colorado’s cultural scene, government, nonprofit and private-sector funders barely took a breath before pouring resources into relief efforts, tapping into sources that had been earmarked for other projects and future plans. Artists — many of whom live paycheck to paycheck, and plenty of whom were given a double whammy when their supplemental jobs in the service industry were eliminated as restaurants and bars shut down — had bills to pay, even if their gallery shows, commissions, concerts or performances were canceled. The situation was dire, and it required urgent action.

RedLine Contemporary used money from its Insite Fund through the Andy Warhol Foundation to create an emergency grant fund; Denver Arts & Venues, the city's cultural agency, contributed, as did Colorado Creative Industries, the state's arts organization. All three worked together to form the Colorado Artist Relief Fund, which RedLine administers. More than 670 desperate and anxious people working in the arts and culture sector applied for grants that max out at $1,000; given the size of the fund at the end of the first week of May, no more than 225 artists would be awarded grants.

Arts and culture funders typically offer grants to nonprofits, and a perennial gripe among Denver artists is that so much money goes to overpaid nonprofit administrators, special funder-driven projects and educational efforts, and so little to creatives engaged in their own professional practices. But with the first emergency grants, most of the money went to individuals, Steuer points out. Arts groups — whose needs were urgent but didn’t demand triage in the first days of the closure — were mostly neglected.

But within days of the shutdown, in an effort to help 43 nonprofit grantees it had funded over the previous eighteen months, Bonfils-Stanton wrote checks of up to $6,000, handing out $125,000 in relief.

“The immediate emergency funding was done very, very quickly,” explains Steuer. “As soon as this crisis came upon us, we thought it was really critical to respond immediately. Normally decisions like this are made by the board of directors. We created an emergency plan. We decided it made sense not to have any process: no red tape, no application, no reporting requirements.”

Then on May 4, the Bonfils-Stanton Foundation announced that it had organized the COVID-19 Arts & Culture Relief Fund, designed to support small- to mid-sized cultural groups in Colorado, which typically have fewer resources for survival, with $5,000 to $10,000 grants. Bonfils-Stanton is contributing $1 million to the fund, which will be administered by the Denver Foundation; that organization donated another $50,000. Denver Arts & Venues gave $205,000, the Gates Family Foundation contributed $100,000, and PNC Bank added $10,000. Individuals including Hal and Ann Logan and Jeremy and Susan Shamos also donated, and the group is still looking for additional contributions.

The grants — albeit a drop in the bucket compared to income lost as organizations have canceled performances, exhibits and fundraisers — couldn’t come at a better time. But they won't be enough to ensure the long-term survival of the area's cultural nonprofits.

The Scientific and Cultural Facilities District, which funds metro organizations through a penny-on-$10 sales tax first approved by voters in the seven-county Denver area in 1988 — recently surveyed hundreds of arts, culture and science groups about how they are faring during the COVID-19 pandemic. Of 321 groups that responded to the survey, 94 percent said that they expect the COVID-19 pandemic and resulting shutdowns will hurt their organizations moderately or severely; 57 percent said they have four months or less in operating reserves; about 45 percent have already made temporary staff reductions (21 percent of that group fear those will be permanent); and 60 percent of the organizations surveyed are moderately confident or not confident at all that their organization will survive.

Their concern is warranted. Even the philanthropic community, which comprises generally well-endowed foundations and wealthy individuals, and government arts agencies are facing a trying future.

“When we move into recovery and rebuilding, I think there are some real issues — not just in the arts-philanthropy world, but in the nonprofit-philanthropy world,” says Deborah Jordy, head of the SCFD. “Are there going to be resources available when so much money is going into COVID relief?”

Many private foundations are granting far beyond the usual 5 percent of their total monies that the Internal Revenue Service requires them to give at minimum every year. The Bonfils-Stanton Foundation, which typically grants $2 million annually and has an endowment of roughly $80 million, has made an additional $3 million available. But in order to do so, it's reducing how much it will able to invest, which could mean less money to give out in upcoming years.

“It’s borrowing from Peter to pay Paul,” says Steuer. “The more money we pay out this year and next, ultimately, we’re eating into our principal. We have less money to give out in future years. It’s probably kicking the can down the road. We’ll have to cross that bridge when we come to it.”

Even large cultural organizations like the Denver Museum of Nature & Science face a tough economic future.EXPAND
Even large cultural organizations like the Denver Museum of Nature & Science face a tough economic future.
Aaron Thackeray

Colorado Creative Industries — which is part of the Colorado Office of Economic Development, and already sorely underfunded compared to similar state agencies — has a $2 million budget from the state based on gaming revenue. That is supplemented by a grant from the National Endowment for the Arts. But casinos are closed and gaming revenue is down. The roughly $740,000 to $800,000 regularly granted to the agency by the NEA requires a match from the state, and with massive budgetary cuts on the horizon, Colorado lawmakers may be unwilling to sufficiently fund Colorado Creative Industries to make that match.

“The FY21 budget parameters haven't been finalized,” says Margaret Hunt, the head of Colorado Creative Industries. “Given the uncertainty of projected state revenues, the state continues to explore multiple contingency scenarios to deliver a balanced budget. Ultimately, the legislature will provide the governor with a budget that meets the agreed-upon parameters. Until that time, the impact on Colorado’s arts community and our office is unclear.”

Su Teatro is funded by the Scientific and Cultural Facilities District penny-on-the-$10 tax.
Su Teatro is funded by the Scientific and Cultural Facilities District penny-on-the-$10 tax.
Felicia Gallegos-Pettis

Even the biggest and most stable source of arts, culture and science funding in Colorado, the SCFD, is likely to see its revenues fall drastically. The sales tax brought in roughly $66 million in 2019, which was divvied up between hundreds of nonprofits, but as consumer spending drops, so will tax revenues.

“Through the pandemic, quarantine, stay-at-home orders, the economic freefall, with everything being closed and the lack of consumer confidence, it’s impossible to predict SCFD revenue,” says Jordy.

She has already proposed cuts to granting based on a projected $46 million coming in over 2020. A certain percentage of the take is earmarked for big institutions like the Denver Museum of Nature & Science, the Denver Art Museum and the Denver Zoo, and they'll all see cuts in their allocations, but so will smaller organizations like the Colorado Symphony and Su Teatro, and much smaller groups that apply for SCFD funds in their counties.

Much of the budget for Denver Arts & Venues, a significant funder of cultural activities, is based on income from Red Rocks, which the city owns. But Red Rocks concerts have been canceled through at least June, and many beyond then are being postponed or rescheduled to 2021.

“Nothing in the live-events ecosystem is going to look the same, but I don’t think anyone is sure what that means either short- or long-term, and we’re not prepared to speculate,” explains Brian Kitts, a spokesperson for Arts & Venues.

Uncertainty looms for all, and the problems that organizations and artists faced paying April and May rent could be trifling compared to the economic fallout that is still to come.

Yet Jordy says there are some reasons to be hopeful: Voters have approved the SCFD continuing through 2030, so it will be able to keep funding arts and culture, even if it may not have as much money to dole out. Some organizations have begun exploring merging to save money, and funders like Bonfils-Stanton are talking about setting aside funds to help groups survive by banding together.

Jordy also takes heart in how arts groups quickly took educational programming and some of their performances and exhibitions online, many for free. Wonderbound and Cleo Parker Robinson Dance are offering classes and performances; the Denver Zoo — which is in a particularly difficult position because it has to care for thousands of animals without any of its regular revenue from admissions — has been showing its zookeepers in action online; eTown is doing regular podcasts; and Denver Film has launched its Dinner + A Movie series, bringing screenings of new releases into people’s living rooms while also partnering with DoorDash for discounts on delivery.

“It shows how nimble they are and how creative they are. They’re smart,” Jordy says. “Everyone is moving as quickly as they can to provide a little pleasure and joy and to keep their organizations relevant to the public.”

But even if they stay relevant, can they stay fiscally sound? After all, even arts funders have finite resources.

“These are unprecedented times,” says Jordy. “These are extraordinary times. We’ve never been through anything like this.”

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