The New York Times covers the shrinking budgets from states for arts funding.The intentionally or not, the article makes a fairly cogent case for untenable position of arts grants in state budgets. This quote says it all:

“We’re furloughing employees,” said a county supervisor, Joe Sanfelippo. “But we want to spend $800,000 on a sculpture? It just doesn’t make sense.”

Robin Pogrebin also provides these details:

Nationwide, state aid represents just a small portion of the money used to underwrite the arts, perhaps 2 to 5 percent of total expenditures, according to Americans for the Arts, a lobbying group. Budgets adopted this spring in the 50 states call for a total of $259 million in spending on culture, or slightly more than the yearly spending of the Metropolitan Museum of Art alone. […] Across the country this is a tough time for small arts groups because state grants have largely shriveled up. Thirty-one states, still staggered by the recession, cut their arts budgets for the 2012 fiscal year, which began on July 1, continuing a downturn that has seen such financial aid drop 42 percent over the last decade, according to data compiled by the National Assembly of State Arts Agencies.

States Slash Arts Funds, Sometimes to Zero (New York Times)