Steppin' Out
Story
Local arts groups make business sense, study says
By Heather Zimmerman
The South Bay arts community does a lot more than show people a good time; arts groups make a significant contribution to the local economy. The results of a new study show that area nonprofit arts organizations have an economic impact of $166.5 million in Santa Clara County, including generating about $12 million in state and local tax revenue and supporting almost 4,000 full-time jobs.
About 75 nonprofit arts groups based in Santa Clara County participated in "Arts and Economic Prosperity III," a national study conducted by the nonprofit arts support organization Americans for the Arts. The study was funded by civic and government organizations such as the National Conference of State Legislatures and the National League of Cities. The Arts Council Silicon Valley coordinated the study locally.
A total of 6,080 arts organizations from 156 communities around the country took part in the study, which was the largest and most wide-ranging such study yet. The results of the study, released on June 6, indicated that arts and culture create $166.2 billion in economic activity nationwide.
The local groups that participated in the study reflect a cross-section of Santa Clara County nonprofit arts groups small and large, representing a variety of art forms. "If we hope for or expect larger community support, we need to take the time to give the community some information," Amy Himes, marketing and development director for City Lights Theater Company, says of why the company participated.
"Arts and Economic Prosperity III" provides information to local arts groups that will be useful in a number of ways, not the least of which is demonstrating that the arts are also a business. "It's important to have this type of information. It shows that economic development opportunities are available where the arts are present," Tamara Alvarado, executive director of Movimiento de Arte y Cultura Latino Americana (MACLA), says.
The information used in the study was drawn from detailed financial reporting from nonprofit arts groups; local, state and federal government data on tax, labor, wage and commerce; and audience surveys. Seventy-five groups in Santa Clara County contributed financial information from fiscal year 2005-06; about a third of those groups surveyed their audiences throughout the 2005-06 season. Almost 1,300 audience members were surveyed. The four organizations interviewed for this article contributed both financial information and audience surveys to the study.
"Arts and Economic Prosperity III" measures the direct results of the organizations' expenditures on employment, and goods and services in the community. It also takes into account how the groups' performing or visual arts events bring additional dollars into the community by attracting audiences who patronize nearby businesses, such as restaurants, stores and hotels.
"It took what I and many other arts group leaders felt intuitively and gave us a lot of hard data for our argument," Nick Nichols, managing director for San Jose Repertory Theatre, says.
Audience surveys polled patrons about how much they were spending in connection with the event they were attending, excluding the price of admission. These expenditures included restaurant meals, parking/transportation, child care and souvenirs or other retail items. For every arts event attended in the county, a patron spends an average of $16.33 in the community excluding admission, and if the patron is not a resident of Santa Clara County, the average amount spent jumps to $21.03.
These numbers give groups a tool to demonstrate that arts funding is an investment that pays actual financial dividends, not directly to funders but to the same community where funders do business. "It gives us fresh ammunition we can use in showing what we already know," Lee Kopp, director of marketing and publicity for Ballet San Jose, says. "We're not asking for a bailout. We can show that this amount of money is going to generate this much return."
Alvarado points out that the idea of arts groups being part of the business community is not new, certainly not for the groups themselves. "We use the arts as a starting point," she says of MACLA's activities in the community. For example, MACLA is currently creating a directory for the small businesses in its downtown San Jose neighborhood.
In addition to defining the arts as a significant business sector, the study provides groups with a calculator, available online, which they can use to figure their individual contributions to the local economy, a number that should resonate with potential funders. "According to that tool, we have an impact of $7 million," The Rep's Nichols says of the calculator. "The whole operating budget for next year is $5 million."
In addition to figuring Ballet San Jose's economic impact, Kopp says he plans to use the results from the calculator to compare numbers with other ballet companies in the country in order to analyze data such as audience demographics.
Many groups express the hope that the good business numbers presented in the "Arts and Economic Prosperity III" study will prove persuasive to the corporate sector, which is often described as underrepresented in South Bay arts funding. "We really hope the study will play up investing in the arts as a business. It shows that it's a good idea businesswise, and not just because it feels good in your heart," Himes says.
