States Pick Up the Slack on Arts Funding After Federal Reductions

State legislatures are moving to soften the blow of shrinking federal cultural support. According to the National Assembly of State Arts Agencies (NASAA), combined appropriations for the 50 states and four territories will reach $649.2 million in fiscal year 2026, a 7.4 percent dip from 2025. Twenty-nine states nevertheless raised their arts allocations, which NASAA executive adviser Kelly Barsdate calls “encouraging” in the face of an uncertain fiscal climate.

Funding fluctuations are dramatic. New Hampshire, hampered by a revenue shortfall in a state with no income tax, slashed support for its Council on the Arts by 90 percent, from $1.5 million to $150 thousand. Other steep drops include California (down 40.8 percent), Missouri (down 59.7 percent), Kansas (down 34.3 percent) and Hawaii (down 74.9 percent after one-time grants inflated last year’s total).

The picture is not uniformly bleak. Florida boosted its arts agency by 36.1 percent to $40.7 million, Oregon jumped 82.1 percent to $14.6 million, North Dakota nearly doubled its budget to $2.5 million and Connecticut rose 54 percent to $10.6 million. Per-capita spending continues to vary widely, with Minnesota leading at $7.85 while Georgia, Wisconsin and New Hampshire all fall below twenty cents.

During the Covid-19 crisis, American Rescue Plan money temporarily propped up museums and performance venues, but those federal dollars are now fading. Pandemic relief to the states fell from $740.9 million in fiscal 2024 to $694.2 million in 2025. President Trump’s recently signed “Big Beautiful Bill” offered no cultural funds, and his May “skinny budget” omitted the National Endowment for the Arts (NEA), the National Endowment for the Humanities (NEH) and the Institute of Museum and Library Services entirely. A House Interior Appropriations Committee draft has restored only $135 million each for the NEA and NEH, 35 percent below last year’s levels, prompting arts advocates to lobby Congress for restoration.

Forty percent of the NEA’s budget flows directly to state councils, but every federal dollar must be matched. Fourteen states now appropriate only the bare minimum required to claim the money, raising fears that those legislatures could withdraw completely if the federal contribution disappears. Kansas, for instance, scaled its grant to the Arts Commission back to $1 million solely to meet the match. Americans for the Arts senior director Jay H. Dick warns that abolishing the NEA could prompt some states to abandon arts funding altogether.

To diversify support, many states have embedded the arts in their tax codes. Montana dedicates a slice of its coal-production tax, while Missouri earmarks a two-percent levy on entertainment ticket sales. Eighteen states sell art-themed license plates whose surcharges funnel into cultural programs, and four states include an arts donation check-off on income-tax returns. Arizona’s arts commission relies heavily on corporate filing fees and a legislatively created Arts Trust Fund. Ohio’s newest biennial budget empowers counties to ask voters for a cigarette tax that would bankroll the arts, and nine other states route portions of lottery or gaming proceeds to cultural agencies.

Barsdate argues that these measures “fulfil the commitment to support culture in a different way,” though they cannot fully replace robust federal engagement. For now, a patchwork of state appropriations, tax mechanisms and private philanthropy is keeping theatres, museums and community arts groups alive, but the gulf between well-funded and poorly funded states is widening. Advocates caution that without a firmer federal partner the long-term health of the country’s cultural ecosystem remains at risk.