In 1957, the Festival of Arts Scholarship Program was established to provide financial assistance for Laguna Beach High Schools students preparing for careers in various disciplines in the arts. Sally Dunn Reed, a senior graduating from Laguna Beach High, was awarded the very first scholarship of $1,000.
In 1989, the Festival of Arts with a $1.5 million endowment established the Laguna Beach Festival of Arts Foundation, a California nonprofit public benefit corporation, for the purpose of charitable giving in perpetuity in the form of art scholarships and/or grants in and about Laguna Beach, California. The Foundation operates independently from the Festival of Arts.
In 2007, the Festival of Arts assumed the financial responsibility of the art scholarships, enabling The Foundation to focus on its grant program for local non-profit art organizations. To date, the Festival of Arts along with the Foundation cumulatively has awarded over $3 million in college scholarships. Disciplines for which scholarships are awarded are Film, Performing Arts (Dance, Music, and Theater Arts, including Performance and Production), Visual Arts, and Writing.