Baltimore officials used federal funds to pay performers at last year’s Artscape festival but failed to get approval from the city’s spending board when they ran over budget, according to a report released Thursday by the city’s inspector general.

The report, published by Inspector General Isabel Mercedes Cumming, probed the use of federal American Rescue Plan Act funds to assist with the cost of Artscape. Baltimore used $1.6 million of its $641 million allocation, received by the city in the wake of the pandemic, to pay for the festival via the Baltimore Civic Fund.

Artscape, which is the city’s largest festival and dates to the 1980s, was rebooted in 2025, switching to Memorial Day weekend and moving from its traditional footprint in midtown Baltimore to a location outside City Hall. Marred in previous years by extreme heat, stormy weather and the pandemic, the revamped festival, headlined by Fantasia and Robin Thicke, was well received.

Of the $1.6 million ARPA allocation, $300,000 was budgeted for talent to perform at Artscape while $40,000 was expected to be spent on talent booking, according to the inspector general’s report. Instead, Cumming found the city spent $516,000 in ARPA money for artists, including $240,000 for one unnamed performer.

According to city policy, overages of more than 25% of an ARPA budget allocation are required to be approved by the Board of Estimates, but no such approval was received, Cumming found.

In a multipage response, Mayor Brandon Scott’s administration defended the spending increase, arguing the festival was an economic success and that changes to line items within an ARPA allocation are not uncommon as the actual cost of some items solidifies. Officials acknowledged the increased costs for talent should have been reviewed by the Board of Estimates but were not.

The grant will be resubmitted to the spending board, the administration said.

The administration took issue with Cumming’s report, which it said “attempts to raise questions” about Artscape’s budget and the use of ARPA funds that “insinuate impropriety where none exists.”

Cumming’s only official recommendation for city officials was that they develop standard operating procedures for events such as Artscape to ensure the city receives the “best possible cost” when picking vendors.

The report quotes the city’s former chief recovery officer, the head of the office that distributes ARPA money.

Asked if they would have selected Artscape to receive ARPA funds, the recovery officer, who is not named, said “probably not” but added that arts are a critical component of the city, according to the report. Shamiah Kerney is the only person to previously hold the chief recovery officer position in Baltimore. Kerney is currently deputy city administrator.

The administration’s response states that Artscape had “clear eligibility” for ARPA funds. The city has a long history of funding the festival, which was twice canceled during the pandemic, officials wrote. Attempts to restart the festival in 2023 and 2024 resulted in economic losses for the city, the administration said.

Cumming’s report also questioned whether funds were used to pay for alcohol that was required by riders included in some contracts with performers. An employee of the mayor’s office instructed a talent booker that such purchases were prohibited, Cumming found, but she said she couldn’t rule out that alcohol was bought.

“The investigation was unable to confirm whether ARPA funds were used to purchase alcohol for Artscape 2025 performers because purchase receipts were not required for payment,” the report states.

In its response, the Scott administration said “ARPA funds were not directly used to purchase alcohol.” Alcohol was included in hospitality riders for performers, but neither the city nor the booking agent paid for those riders, it said.

ARPA funds were used, however, to pay for a VIP reception hosted by the mayor during Artscape. According to the report, the city’s current chief recovery officer, Elizabeth Tatum, was asked for an opinion on using ARPA funds for a VIP event. She responded it required more explanation and was not preferable.

The Scott administration said about $26,000 in ARPA money was used for the VIP reception, including facility rental, room setup and decor. Money solicited by Create Baltimore paid for alcohol, officials said.

“Artscape 2025 was an economically impactful investment that advanced the city’s recovery goals and delivered measurable results for residents, businesses and Baltimore’s arts community,” the mayor’s office wrote. “While the city acknowledges the value of continued process refinement, the report does not undermine the impact or public benefit of Artscape 2025.”