Questions about arts center funding

A few points worth considering regarding the decision to grant Town of Hilton Head Island funding to the Arts Center of Coastal Carolina at Tuesday’s Town Council meeting:

The arts center leadership has conducted a targeted lobbying campaign during the last three months. This included distribution of free ticket packages to decision makers and influencers. Several recipients returned these gifts due to obvious ethical concerns.

The arts center’s financial disclosures show in each of the last three fiscal years an operational loss at an average of about 10 percent of revenue. Unfortunately, the arts center cannot provide independently audited financial statements. Audited financial statements are in most communities a mandatory requirement for publicly funded grants.

Retitling a grant into a “lease agreement” is only possible if the town retains ownership of the leased equipment. This seems to be a wholly impractical solution, chosen only to circumvent the audit requirements.

The economic impact of the arts center has not been established in an independent analysis. The arts center leadership has claimed about $25 million in annual economic impact, yet the American Association for the Arts’ economic impact calculator, an industry standard tool considered arts friendly, shows a maximum of $5 million annual impact using the arts center’s information from its own disclosures.

These issues need to be addressed before funding to the arts center is provided, and the town needs to implement checks and balances based on established principles to govern the distribution and the execution of public funding.

This story was originally published October 9, 2017 at 2:27 PM with the headline "Questions about arts center funding."