City staff proposed a Cultural Heritage Grant Program on Nov. 5 to distribute $874,000 held in the FY26 budget after federal grant-assurance requirements led the city to end a prior culture-specific grant program.

Crystal Jones, director of the Department of Arts and Culture, told council the new program is designed to support continuity of community-rooted cultural organizations that "preserve, promote, and revitalize a distinct cultural heritage." The department proposed eligibility limited to organizations that already are operational grantees under the FY26 budget (41 organizations were identified as in-scope), nonprofit status, year-round programming, and operating expenses consistent with the department's definition of small and mid-size organizations (roughly $3 million or less in annual operating expense based on Form 990 data).

Award design and timing: Staff proposed awards equal to up to 20% of an organization's three-year average operating budget (Form 990), capped at $150,000, with reimbursement-based payment (80% at contract execution and the remaining 20% after validation of expenses). Because the department is launching the program mid-fiscal year, staff emphasized a reimbursement model and proposed two timelines: a standard schedule (panel review and council action in January/February) and an expedited option (one-week application window, staff review, council approval Dec. 11 and funding in December).

Jones said roughly 11 organizations had been affected by the elimination of the prior program and listed several by name during the meeting (including Guadalupe Cultural Arts Center, Esperanza Peace and Justice Center, Teatro I and others). Council members generally supported the expedited timeline and asked staff to clarify whether prior grantees should receive priority, whether awards could overlap with other city funding (delegate agency awards, bonds, or other city grants), and how the program will be evaluated if continued in later grant cycles.

Legal and process follow-up: Staff said they will return with written guidance for council offices on eligibility and will provide recommendations about whether and how the previously impacted organizations should be treated in the selection process. Several council members asked staff to consider weighting continuity of sustained programming (organizations that continued to provide cultural programming despite the prior funding change) in the review criteria. Crystal Jones and city staff committed to follow up and agreed to consult the arts commission and the arts funding committee as part of the review if the standard timeline is used.

Next steps: The department recommended opening applications next week. If council approves the expedited timeline and staff recommendations, the department would present funding recommendations to the Arts Commission and to council for approval by Dec. 11 and distribute funds in December so impacted organizations would receive support during the holiday period.