In the Oregon Legislature, a matter of broken Trust

This is exactly what was never supposed to happen. This is the breaking of the devil’s deal the Oregon Legislature made to keep the culture lobby off its back.The pickpocket, in  formal attire/Wikimedia Commons

This is what happens when an entire state thinks that “fiscal responsibility” means tax kickback checks to citizens in flush times, $10 corporate income taxes in all times, trying to balance the state budget on a two-legged stool (property and income taxes, but no sales tax to keep the stool from tipping over), and a pig-headed refusal to recognize — in Oregon, of all places — that you need to plan for a rainy day.

Don’t look now, but it’s pouring.

And that’s why the Oregon Legislature, trying desperately to fill the gigantic hole in the state’s budget, is cribbing money from every place possible — including the Oregon Cultural Trust, as we reported in this earlier story and as political writer Harry Esteve explains in this morning’s Oregonian.

Let me be clear: I don’t blame the Legislature for looking at every penny available from every source as it tries to deal with this fiscal crisis. It’s a no-win proposition: No matter what our legislators do, on some level it will be wrong. This is a debacle made partly at the national and international levels, and partly by Oregon’s long history of pretending it can have a little bit of everything in life without having to pay for most of it. Now the piper’s at the door, demanding to be paid. And it’s the Legislature that has to figure out how to do it.

What’s depressing is that we’ve been down this road before. And the Oregon Cultural Trust was set up to ensure that in the toughest of times — which once again, we seem to be entering — vital cultural projects and organizations won’t be cut off at the root.

The deal the Legislature made on the Trust when it passed enabling legislation in 2001 was essentially this: Culture in Oregon will be pay-as-you-go, but we’ll help. We’ll establish a small beginning balance, we’ll sell cultural license plates to help fund the Trust, we’ll provide a nice tax break for contributions to cultural groups, and we’ll administer the thing. And then, please, leave us alone.

What that means is that every cent from cultural license plates and donations to the Trust has come into the state coffers with a clear, specific and supposedly inviolable earmark. The money was given for cultural purposes and no others. Using it for any other purpose is a moral violation of trust, and probably a legal violation as well: There is long legal precedence in the United States in favor of donor intentions.

Picking the Cultural Trust pocket, even in times of extraordinary fiscal crisis, is foolish in the long run in three ways.

First, once burned, twice shy. Why would anyone donate to the Trust again once it’s been made clear that the state can and will take the money and use it for something else? That precedent surely will strangle the Trust and cripple or even kill it.

Second, this can’t be legal. If the Legislature ends up appropriating this $2 million-odd for other purposes, it almost certainly will be slapped with a lawsuit. And how much will it cost for the state to defend a suit it will probably lose?

Third, who you gonna trust? Not the Legislature, which has broken its word. Not the governor, who says it’s OK. The erosion of public trust in government is a problem with serious consequences for democracy — as trust goes down, more and more people simply tune out, choosing not to take part in the political process at all. For government, trust — even trust shaded with skepticism — is vital. Break it and you’ve broken yourself.

For some background on the beginnings of the Oregon Cultural Trust, on how we got to this point, and on how frustratingly familiar today’s “news” sounds, read on:

This is an excerpt from a story I wrote that ran in The Oregonian on July 16, 2002:

The trust is, literally, a trust — a fund that is beginning small and will take a long time to build to the point that it can award large amounts of money to anyone. And it is a trust in the sense that it trusts Oregon ‘s citizens to throw their support behind it, because if they don’t, it won’t work.

“We’re all tremendously excited about it,” said Tony Woodcock, president of the Oregon Symphony. “But it’s years away.”

Still, it is far better than the next to nothing that has been the state’s financial contribution to cultural organizations for decades. And in a time when government support for arts and cultural institutions is under attack from the United States to England to Europe, it was accomplished through rare bipartisan agreement in the last Oregon Legislature.

How, in a time when the state’s budget faces an $860 million deficit, was the trust pulled off? With a little tape, a little tap-dancing and a lot of ingenuity.

Its money is being cobbled together from three main sources:

* Sale of some surplus government property. Two parcels on the block should bring in considerably more than $3 million. That’s an excellent kick-start, but this leg of the money stool isn’t entirely stable: It has to be reapproved by the Legislature every two years.

* Sale of a new “culture” license plate for cars and trucks. A good idea but one that faces competition from the existing salmon and Oregon Trail plates, both of which also appeal to many of the people who would be tempted to buy culture plates.

* Perhaps most promising, a tax-credit plan that works like this: If you make a contribution to a nonprofit cultural organization, you get a normal tax deduction. If you match it with a gift to the cultural trust , you get a tax credit — a dollar-for-dollar discount on your tax bill of up to $500 for individuals or $2,500 for businesses. That’s as close to a free lunch as you can get.

The triumph of conceiving and pushing through the Oregon Cultural Trust is real. But before anybody guzzles a celebratory bottle of bubbly … a few things should be considered: …

* It’s going to take several years for the trust to have a significant effect.
The fund will be small to begin with, and most of the money raised will be reserved to create an endowment. That is good in the long run but limiting in the short.

* The pie is being split a lot of ways. This isn’t an art endowment, it’s a cultural endowment, and it defines culture in a broad sense. Money will go to arts groups, humanities organizations, cultural heritage groups and historic-preservation groups. About one-third of the money will go to five existing state-level agencies: Oregon Arts Commission, Oregon Council for the Humanities, Oregon History Center, State Historic Preservation Office, Oregon Heritage Commission. Another third will go to counties and tribes to spend at their discretion. The final third will be direct grants to cultural organizations. Nobody’s going to get rich, or even solve all their funding problems, off this thing.

* What the Legislature gives, the Legislature can take away. A one-time, $1 million appropriation has been approved to get the cultural trust rolling. But with the state budget in severe deficit, another special session is under way, and there isn’t much that won’t be on the table. Nobody’s saying the Legislature will grab the $1 million away — as of Friday afternoon, it had resisted the temptation. But nobody’s saying it isn’t possible, either.

* Who knows how successful the plan will be?
It depends to an extraordinary degree on how willing private citizens are to spend the money to make it work.

* Is it a beginning or an end? As forward-looking as the trust is, it can’t cover all the bases. State funding for groups such as the Oregon Arts Commission has ranked near the bottom nationally for decades. Will the trust be a supplement or a substitute? If, come budget time, the Legislature tells cultural groups, “You have the trust ; we’ve done our job,” little has been gained — and in the short term, a lot has been lost.

And here’s an excerpt from an earlier story I wrote that ran in The Oregonian on Jan. 13, 2002:

Fasten your seat belt. It’s going to be a bumpy ride.

With dead rot in the Silicon Forest and a money squeeze that Gov. John Kitzhaber says has left the Oregon state budget $850 million in the hole, almost nobody’s getting out of this recession unscathed.

Especially in the arts.

Oregon can’t even find adequate money to float its public schools, let alone its universities. Portland, “the city that works,” can’t keep its mentally ill and chronically unemployed residents off the streets or out of the homeless camps. Oregon bears the worst unemployment level in the nation. One in 10 Oregonians receives food stamps.

Does anyone seriously expect that money for arts programs isn’t going to dry up fast?

Ask The Musical Theatre Company, done in partly by a steep rent increase from its landlord, the Portland School District, which was desperate to find more money for its own cash-strapped programs.

Ask PIPfest, the innovative international performance festival cut loose by Portland State University because the university can’t or won’t pay the bills anymore.

Ask the “big four” performance companies — opera, ballet, symphony, Portland Center Stage — which stand to lose $800,000 among them from their already precariously slim budgets because Mayor Vera Katz needs to whack millions from the city budget.

Ask members of the nascent Oregon Cultural Trust, pushing hard to keep a small but important piece of state support in the budget as the Legislature deals with cuts. “If we don’t get this off the ground this year, it may never get born,” says board member John Hampton. “You can wound something mortally before it’s born.”

Welcome to the new reality, which is different only in degree from the old reality.

The distance between talk and actuality about the arts has always been a chasm in Oregon.
While chambers of commerce and official advocacy groups pull out complex algorithmic charts to tout arts tourism as an important leg of the economy, the state has never put its wallet where its mouth is. It wallows near the bottom nationally in state funding for the arts. That throws extra pressure on corporations and foundations to fill the gap. But Oregon has never been much of a corporate center, and as a deluge of mergers and takeovers has globalized the economy it’s become even less so: Corporate headquarters have been skipping out of town like deadbeat dads on the lam. Foundations, meanwhile, find more hands grasping for their lifelines — and because their health is dependent on the health of the economy in general, foundations have less money to give at a time when more people need it.

It’s hard to argue persuasively for increased arts funding when people are out of work and families can’t pay the rent. But as Charlie Walker, former Linfield College president and another board member of the Oregon Cultural Trust, puts it, even amid a recession it’s important do some long-term thinking.

Meanwhile, some individuals will choose to give money to arts groups they love. Artists will hunker down, go slim, try to ride out the storm. More groups will go broke. Some, against the odds, will flourish. A few will find a kind of liberation in poverty and create interesting low-cost work.

One small comfort:
When it comes to funding, at least Oregon arts groups can’t tumble too far. They’ve never got very high in the first place.

Sound familiar? If it does, get mad — and let your legislators know.