Not usually. My daughter has done a couple such residency gigs.
No government money was involved. They had to work at the co-op doing classes or manning the “store.” That was in exchange for studio space and gallery space.
You would be surprised at the places that do residencies; her husband had one at the Kholer plant for his metal work. Corning glass does them for glass blowers.
The Art world is a little ecosystem unto itself.
Sculpture Space counts ***New York’s Council on the Arts, the National Endowment for the Arts***
that’s taxpayer money...
the corning program is most likely funded by corning