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House debate centers on arts endowment amendment that would use rainy-day interest to fund grants
Summary
Sponsor Representative Nielsen introduced amendments to HB 46 that would earmark 10% of state surpluses into a restricted arts endowment and use only interest — not principal — to match community arts grants. The House agreed to 'circle' the bill for further study after debate over a $10 million fiscal note and matching rules.
Representative Sam Nielsen, the sponsor of House Bill 46, outlined amendments proposing a new funding mechanism for an arts endowment that would draw only the interest earned on monies set aside, leaving principal in the state’s rainy-day fund untouched. "What we're proposing is that we take the interest off the rainy day fund ... and put it in that box to the right that says endowment funds available for programs," Nielsen told colleagues during floor remarks.
Nielsen said the amendment would earmark 10% of a state surplus into a restricted account; the account’s principal would remain available to return to the rainy-day fund should the state need it. Only interest generated would be distributed to arts organizations when matched by local or private dollars. Nielsen described a sliding match formula: 1-to-1 for requests under $100,000, larger matching ratios for bigger requests, and a safeguard that state funds would remain with the state treasurer if a grantee failed.
The sponsor acknowledged a fiscal note of approximately $10 million attached to the bill and circulated illustrative numbers showing hypothetical returns "over the past five years" that would have produced several million dollars available for match and grants. Lawmakers questioned the precise amounts; Nielsen cited handouts and figures to the floor and offered to 'circle' the bill if members wanted more time to study the numbers.
Several members voiced support for finding stable funding for community arts and youth programs and suggested alternatives that might be combined with Nielsen’s approach — including proposals to capture some tax dollars repatriated from out-of-state investors or to use compounded interest from other funds. Representative Olsen and others urged coordination with similar proposals under preparation.
After discussion, Representative Nielsen and several colleagues agreed to circle HB 46 so caucuses and the arts community could review the amendment language and fiscal detail. The motion to circle passed on recorded votes.
