Cuyahoga Arts & Culture considers November '24 levy to expand cigarette tax
Cuyahoga Arts & Culture made several moves at its Wednesday board meeting aimed at addressing consistently declining revenue. The agency is funded by the county cigarette tax. It’s slated to bring in just over $10 million this year, down almost 50% from its inception in 2007.
Area arts leaders have been working for more than two years to get permission to expand the tax. State lawmakers finally agreed this year to allow CAC to ask voters to increase the tax from its current rate of 30-cents-per-pack.
In a presentation from political consulting firm R Strategy Group, CEO Jeff Rusnak outlined the growing voter support for arts funding over the past two decades: From a failed attempt at a property tax in 2004 to the creation of the cigarette tax in 2006 to its overwhelming renewal in 2015. The tax is slated to expire in 2025 without a renewal, which Rusnak said should be placed on the November 2024 ballot.
“That allows proper time to do the work on the front end to prepare for the initiative,” he said.
That includes community outreach about how much to potentially ask voters to increase the tax as well as messaging about arts funding over the next three months. Rusnak said his firm’s recent polling showed that county residents support arts and culture funding for several reasons, including new evidence that it provides a haven.
“People see arts and culture as a vehicle or a place, a safe space for young people,” he said. “I know there’s been a lot of work around arts and culture and how it ties to our health, but I think you’ll also see it as a safety thing.”
Michael Gill, executive director of arts news nonprofit CAN Journal, was at the meeting. Like Ideastream Public Media, his publication receives funding from CAC. Gill said, instead of the March primary election, next fall seems to be the earliest that CAC could be ready for the ballot.
“I think it’s not a bad thing that it’s a November election,” he said. “That election is going to have good turnout. So, Cuyahoga County’s voice will be broadly heard.”
Rusnak said alternative taxes have been considered over the past two decades, including one on video rentals, another on dine-in meals and a third on alcohol. None of those were officially presented to voters.
Cigarette tax revenue is currently 9.2% lower than this time last year due to population loss and less people smoking. CAC staff noted that the agency’s investments are overperforming, shrinking the deficit.
Cuyahoga Arts & Culture awarded more than $12.3 in grants to 273 organizations in November 2022. Arts groups will be making their cases Sept.19-20 for this year’s allocations. At Wednesday’s meeting, the board approved the total available amounts for grantmaking over the next two years, a point of contention at several past meetings due to the declining revenue.
CAC Executive Director Jill Paulsen presented three scenarios for 2024 and 2025. One keeps funds at a lower level than 2023 granting but consistent at more than $9.1 million over the next two years. A second more aggressive scenario, which Paulsen said is favored based on community feedback, puts each year’s level at $11.1 million. The third scenario allows for a slight increase to $13.1 million next year, followed by a sharp decrease to less than $8.9 million in 2025.
CAC Board Vice President Michele Scott Taylor and Board Member Charna Sherman sparred verbally over whether there was enough information available to vote on funding scenarios. Sherman suggested that the “top six” organizations receiving funding be polled for their opinions of the options. Last year, those were the Cleveland Institute of Art, Ideastream, Rock & Roll Hall of Fame and Museum, Cleveland Museum of Art, Cleveland Orchestra and Playhouse Square.
CAC Board Member Daniel Blakemore is also philanthropy director for the nonprofit Conservancy for Cuyahoga Valley National Park. He said scenario three seemed disruptive in its inconsistent year-to-year funding amounts. The CAC board eventually approved scenario two.
After the meeting, Assembly for the Arts Board President Fred Bidwell said he was “a little disappointed” that a decision was reached without more time for public discussion. Without expressing a preference for any of the options, he said a case could have been made for scenario three.
“In a high inflation environment, dollars that you have today are much more valuable than dollars you might get access to tomorrow,” he said.