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An art for helping boost the economy

01:00 AM EDT on Friday, June 8, 2007

By Bill Van Siclen

Journal Arts Writer

PROVIDENCE — Calling the results “amazing,” “exciting” and “extraordinary,” city officials yesterday unveiled the findings of a national study showing that local arts and cultural organizations pump more than $110 million annually into the state’s economy. The study, conducted by Americans for the Arts, a Washington, D.C.-based arts advocacy organization, also found that nonprofit arts and cultural groups supported nearly 3,000 full-time jobs and generated more than $11 million in state and local tax revenues.

The study, titled “Arts & Economic Prosperity III,” also found that nonprofit arts and cultural groups contributed far more to the local economy than the national average.

The figures were especially striking when Providence was compared with other cities of similar size. Based on data supplied by 56 cities and counties with populations between 100,000 and 250,000, Providence’s nonprofit arts and cultural sector ranked second in total spending ($112 million), third in number of full-time jobs (2,759), and second in state and local tax revenues ($11.1 million).

That was well ahead of cities such as Orlando, Fla., Savannah, Ga., Tempe, Ariz., and Santa Cruz, Calif. Only Pasadena, Calif., ranked higher in overall arts-related spending ($180 million) and tax revenue ($16 million).

Speaking to an audience of local arts and business leaders at the just-opened Renaissance Providence Hotel, city arts and tourism director Lynne McCormack said the study “busts the myth” that nonprofit arts groups don’t contribute much to the local economy.

“If nothing else, this should put an end to the idea that ‘nonprofit’ means ‘no money,’ ” McCormack declared. “It’s often said that the arts are good for your soul. This study shows that they’re also good for the economy.”

McCormack’s boss, Mayor David N. Cicilline, also praised the study, although he warned against taking its findings for granted.

“Whether it’s seeing a play at Trinity Rep, listening to a concert at Vets Auditorium or spending an evening out at WaterFire, we know that arts and cultural events contribute both to our quality of life and to our economy,” Cicilline said. “But simply knowing that the arts are a good thing isn’t enough. If we want them to remain vibrant, we need to continue and even increase our investment in the arts.”

In a news release from its national headquarters, Americans for the Arts called the study “the most comprehensive economic-impact study of the nonprofit arts and culture industry ever conducted in the United States.” In all, the study examined economic and attendance data from more than 6,000 arts and cultural organizations based in more than 150 cities, towns, counties and “multi-county regions.”

Among the findings: on a national level, nonprofit arts and cultural groups generate $166.2 billion in economic activity annually; staffing at arts organizations generates the equivalent of 5.7 million full-time jobs; and local, state and federal tax revenue from arts-related spending totals more than $29.6 billion a year.

To arrive at these figures, the study used something called input/output analysis, a method that allows economists to track how many times a dollar is re-spent within the local economy. (As an example, the study cites the case of a theater company buying a $20 gallon of paint from a local hardware store. A portion of that money is then “respent” when the store pays its employees, and again when the employees use their paychecks to buy goods and services from other local businesses.)

The study, conducted by researchers at Georgia Tech University, also compared arts-related spending patterns in regions with roughly similar populations. Providence, with a population of nearly 180,000, was part of “Group C,” along with cities such as Savannah and Orlando.

With the exception of Pasadena, a smaller but wealthier city near Los Angeles, Providence topped the charts in virtually every category. For example, the study found that overall spending by nonprofit arts and cultural groups in Providence amounted to $111,809,777 in 2005, the last year for which economic data were available. That was well behind Pasadena ($180,092,378), but ahead of Burlington ($26,892,997), Boise ($38,024,057) Savannah ($46, 632, 526) and Orlando ($95,475,446).

On the tax front, the study found that Providence arts and cultural organizations generated more than $5.6 million in tax revenue for the city, and more than $5.4 million for the state in 2005. Again, with the exception of Pasadena, those figures were higher — often much higher — than for other cities in Group C. (Note: nonprofits generate tax dollars in several ways, including direct taxes paid on salaries and ticket sales and indirect taxes paid by audience members for food, parking and other services.)

The city also fared well in the study’s overall rankings.

Spending by local arts and cultural groups on salaries, props, costumes and other so-called “direct expenditures,” for example, was nearly twice the national average. Meanwhile, audiences attending arts events in Providence spent more than three times the national average at restaurants, bars, parking garages and other businesses.

Another finding was highlighted by Nina Ozlu, chief counsel for government affairs for Americans for the Arts. Unlike most cities, where local residents are the primary patrons of arts and cultural events, Providence draws more than 60 percent of its audiences from outside Providence County.

“That’s one of the big surprises,” Ozlu said. “Obviously, people love coming to Providence for arts and culture.”

At the same time, Ozlu conceded that while the study painted a detailed picture of Providence’s nonprofit arts community, it did have some gaps. Since the study focused on nonprofit arts groups, for-profit arts businesses such as art galleries, jazz clubs and graphic-design studios were not included. Likewise, the economic contributions of artists, writers, musicians and other individual artists were beyond the study’s scope.

Americans for the Arts is a national arts advocacy organization representing more than 5,000 arts groups from around the country.

“Whether it’s seeing a play at Trinity Rep . . . or spending an evening out at WaterFire, we know that arts and cultural events contribute both to our quality of life and to our economy.”

Providence Mayor David N. Ciciline,
on a national report documenting the impact of arts on a community.

bvansicl@projo.com

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