Eight nonprofits applied to the Killeen Arts Commission for nearly $456,000 in grants, including taxpayer money, before that figure was more than halved thanks to its scoring system.
And on Tuesday, members of the Killeen City Council will consider whether to approve the use of hotel occupancy tax revenue and American Rescue Plan Act money for these grants.
“One of the Arts Commission’s primary responsibilities is to make recommendations to City Council regarding the allocation of Hotel Occupancy Tax funds for arts grants,” the acting executive finance director wrote. , Judith Tangalin, to City Manager Kent Cagle in an Aug. 16 Staff Report. “Texas Tax Code Chapter 351 governs the use of municipal hotel occupancy taxes. Section 351.101 requires two criteria to be met in order to spend municipal hotel occupancy tax revenue.
The criteria: Expenses must promote tourism and the convention and hospitality industry, and they must meet one of nine statutory categories, according to the staff report.
“The encouragement, promotion, enhancement and application of the arts is one of nine categories. Section 351.103(c) limits the amount of hotel resort tax revenue used for the arts to 15% of the total hotel resort tax revenue collected.
In June, nine organizations submitted their grant applications to the city’s arts commission, Tangalin said in the report.
“Events proposed by applicants for the grant have been assessed by the Arts Commission in accordance with the Arts Commission grant award policy adopted by City Council on April 14, 2020. One application has been rejected.”
The approved candidates are Armed Forces Natural Hair and Health ($92,245), IMPAC Outreach ($46,691), Vive Les Arts Societe ($41,226), Songhai Bamboo Roots Association ($29,407), Vive Les Arts Children’s Theater ($20 $772), Killeen Sister Cities, Osan, Korea, Committee ($12,295), KZamore Foundation ($5,554), and Artesania y Cultura Hispana ($4,478).
Grant requests total $259,668 for 27 events in the 2022-23 fiscal year. But when the organizations submitted their applications, that figure was $455,763. It was whittled down by assessments of the applications by KAC board members — at least two of whom are involved with a pair of applicant nonprofits. They are Luvina Sabree from Armed Forces Natural Hair and Health and Darlene Golden from Songhai Bamboo Roots Association. Golden is president and Sabree is vice president.
It’s unclear how KAC board members — the others are John Miller, Erin Hughley, Van Fraley, Angela Galbreth, Monique Brand, Regina Mitchell and Christopher Brown, according to the city’s website — assess and rate the candidates. The Herald requested income and expense reports from each KAC grant applicant for the past two fiscal years under Texas public information law.
Miller told the Herald in October 2020 that KAC members fill out ballots and each is given a score. The scorecard includes a set of criteria, described as ranging from artistic to economic: Does a program promote tourism and the convention industry? Does it have artistic value and related fields?
After members complete their individual ballots, they are submitted to the city, and staff members score and apply weight to them. From there, they calculate how much money each candidate should receive.
The newspaper also asked the city to provide a review of financial documents to officials to determine whether to approve grant funding for KAC applicants, and it was considered a request under the law. on Texas Public Information. As of Friday afternoon, these documents had still not been received.
The Herald also asked council members Roman Alvarez, Riakos Adams, Jessica Gonzalez, Mayor Debbie Nash-King, Ken Wilkerson, Jose Segarra, Michael Boyd and Nina Cobb to answer questions about KAC’s financial accountability.
On Friday afternoon, only Segarra responded. Here are the questions and their answers:
Q: What is the rationale for using tourist tax revenue to partially fund one-day events or those that do not attract overnight tourists?
A; “Organizations using hotel occupancy tax revenue are required to provide proof to the city that they had at least one person staying at one of our hotels for every $3,000 … granted. Otherwise, they are subject to a penalty.
Q: What policies or procedures are used to ensure KAC grant recipients are 501(c)(3) organizations under the Internal Revenue Code and are up-to-date with their tax filings?
A: “Applicants are also required to provide proof when applying for funding that they are a 501(c)(3) with current state verification and a current year exemption letter. of the Internal Revenue Service.”
Q: At some KAC-sponsored events, visitors must pay admission. Why is this necessary when these organizations are already subsidized by taxpayers’ money?
A: “The Town of Killeen does not pay 100% of event expenses and the reason some fees are charged is that they are required to provide consideration based on the amount of the grant. event and some find the match through other means such as finding sponsors.
The city held grant application workshops on March 25 and April 15, documents show. After the April 22 application deadline, KAC “assessed” the applications on June 10 and “reviewed” them on July 8. These come out of the most recent grant cycle in which seven organizations – Vive Les Arts Societe; Killeen Sister Cities, Osan, Korea, Committee; Natural Hair and Armed Forces Health; Vive Les Arts children’s theater; Association of Songhai Bamboo Roots; sensitization of IMPAC; and The Crossroads to Texas Quilt – received $229,622 of Killeen HOT revenue and ARPA funding.
President Joe Biden signed into law ARPA in 2021 — a nearly $2.9 trillion economic stimulus bill that allocated $350 billion from the Coronavirus State and Local Fiscal Recovery Fund to state and local governments.
During this fiscal year, the city used $37,167 in HOT revenue and $192,455 in ARPA funding for the total of $229,662 used to fund multiple KAC events. Under Texas law, municipalities can use HOT money “solely to directly promote tourism and the convention/hospitality industry,” according to the state comptroller’s website. “This means profits should be spent on projects or events that bring visitors or attendees to stay overnight in the community, thereby generating more hotel occupancy tax.”
The state hotel occupancy tax rate is 6% and the Killeen rate is 7%, for a total room tax of 13%.
HOT revenue represents 1.1% of the city’s total revenue. In the proposed budget for 2023, officials expect to receive more than $3.1 million in HOT money, up from nearly $3.6 million this fiscal year. In fiscal year 2020-21, that figure was around $2.7 million.
The events planned by KAC grant applicants in the fiscal year that begins October 1 are:
Vive Les Arts Societe – “Elf”, “Spamalot”, “Chemical Imbalance”, “The Wizard of Oz”, “Come From Away”
Armed Forces Health and Natural Hair – Armed Forces Health and Natural Hair Fair, Veggie and Art Fest, Killeen Black Art and Film Festival, Summer Fest
KZamore Foundation — Art Showcase and Jazz Community Brunch, Stage Play
IMPAC Outreach – African American Art and History Showcase, Taste of Africa, Rhythm & Vibes: Killeen Poetry Slam, Inspired Voice Narrative Project, WordFest
Killeen Sister Cities, Osan, Korea, Committee — International Festival, Cultural Exchange
Vive Les Arts Children’s Theater – “James and the Giant Peach”, “The Little Mermaid”, “Missoula Children’s Theater”
Artesania y Cultura Hispana — Art and Culture Festival
Songhaï Bamboo Roots Association — Kwanzaa, Jazz Extravaganza, Trail Ride/Southern Soul, Caribbean Afr’Am Festival
The Killeen City Council meeting on Tuesday is scheduled for 5 p.m. at City Hall, 101 N. College St.