Art feeds the soul – and the economy

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Results of economic impact study spell out the value of the arts for the southern Fox Valley

Story by Robin Driessen Bruecker

WORDS LIKE “HEART,” “LIFEBLOOD” and “soul” often have been used when describing various aspects of communities. Perhaps one could say that a community’s residents form the heart, its businesses generate the lifeblood that sustains it, and its local arts are the soul.

Each feeds the other. Companies and other benefactors make donations to local arts organizations, and the arts in turn provide entertainment and cultural enrichment for employees and other community members.

Economic impact

PERFORMANCE AND VISUAL ARTS centers support the community’s economy by providing jobs and attracting patrons who use local restaurants, hotels, gas stations and other businesses.

“From recent studies, we know arts and culture organizations account for $32.3 million of activity annually,” said Maria Van Laanen, executive vice president of the Fox Cities Performing Arts Center in Appleton, which has brought an estimated $178 million into the local economy since it opened in November 2002. “With 1.8 million ticket holders visiting the center since opening and even more attending community events, things like paying for dinner, a babysitter and gas can make a real impact. The touring companies add to the regional economy as well, hiring local musicians and stagehands, dining out and shopping at area retailers.”

The Fox Cities PAC had a driving role among the organizations in the Greater Fox Cities area – Calumet, Outagamie and Winnebago counties – who worked with the national Americans for the Arts nonprofit group to study the direct and indirect economic impact of nonprofit arts and culture organizations in the region. The results of the Arts & Economic Prosperity IV study were significant: annual direct spending of $21.2 million in the region, plus indirect spending of $11.1 million.

“As one of the larger nonprofit arts organizations in northeast Wisconsin, we see it as our role to invest in tools that strengthen the arts and culture industry in our area,” said Van Laanen. “These tools are important to us and important to our neighboring organizations. Intrinsically, we have always known that the arts have a significant impact, and now we have the statistics to prove it. These numbers invite businesses to take a closer look at our industry and see how vital it is to the community they call home.”

Van Laanen noted that a previous study was done by Americans for the Arts in 2007 before the recession, so there were guarded expectations for the more recent study.

“However, the economic activity numbers remain strong, proving that our community values the arts and are willing to come out and see a performance,” she said. “They are not only purchasing tickets but supporting the local economy with related activities.”

Regional focus

The OSHKOSH OPERA HOUSE Foundation Inc., which operates The Grand Opera House, was one of the organizations with a supporting role in the study. Joe Ferlo, president and CEO of the Foundation and director of The Grand, said it had commissioned a separate study by the same group in 2007.

“It made more sense, this time around, to focus on a more regional level,” he added. The Grand was closed in 2009-10 for extensive ceiling and roof repairs, but it was still able to contribute to the second study.

“It’s extremely valuable to have business-friendly data to share,” Ferlo said of the study results. “Sometimes, we in the arts are not as well-voiced in these areas. Our business is unique, and sometimes difficult to describe in business terms. Studies like this, and the discussions that come as a result, enable arts administrators and the business community to have conversations they need to have, on a recognizable playing field.”

Numbers from the Americans for the Arts study are one important tool when showing businesses it’s worth their donations and patronage in support of the local arts. The Fox Cities PAC summed up the Greater Fox Cities region results of the Americans for the Arts’ Arts & Economic Prosperity IV study in a June 2012 news release: The $32.3 million total supports 430 fulltime equivalent jobs and generates local and state government revenues of $1.4 million. The $21.2 million portion that was spent by the nonprofits in 2010 went to employee salaries, supplies and services from other businesses, and acquiring local assets. The $11.1 million portion, which excludes event admission, can be averaged to $19.45 per person for each event, which may be spent on local dining, parking fees, souvenirs and gifts, hotel stays, and other event-related activities. And 23.9 percent of the patrons came from outside the tri-county region.

“Oshkosh and the Fox Valley have tremendously strong cultural institutions that really distinguish this community and region from others,” noted Aaron Sherer, executive director of the Paine Art Center and Gardens in Oshkosh, which also participated in the study. “It was not a surprise for us to see that our organizations have a big impact on the economic vitality of the area.”

The business side of things

THE ARTS CONTRIBUTE to the local economy in many direct and indirect ways, noted Ferlo.

“In the specific instance of The Grand, it brings people downtown, usually in the evening, when increased traffic on the streets and sidewalks is most welcome,” he said. “It’s tremendously valuable to a city center to have ‘people traffic’ as it not only increases the area’s positive energy, but also reduces the negative activity that can happen in less busy areas.”

Events often boost sales for area service businesses, particularly restaurants, where patrons will make an entire evening out of an event by dining out and then attending a show.

“When the event is one of more regional interest — Jeff Daniels, Mallory Lewis, John McGivern, for example — that draw extends even further into the region,” Ferlo said. “Certain events can create opportunities for hotel stays. Even locally produced shows spend money in hardware stores, lumber companies, and fabric shops.

Van Laanen noted one of the subtler aspects of the arts’ impact on a community is generating activity during slower times of the year for other businesses.

“The Wisconsin premiere of Wicked in February 2009 is a prime example because as the economy entered a recession, the center was still drawing more than 63,000 ticket holders to the Fox Cities and generating more than $18 million in economic activity for local businesses,” she said.

Major events at the Paine Art Center have attracted a sizeable number of out-of-town visitors. Citing a recent Ansel Adams photography exhibit and room-by-room storytelling scenes called Nutcracker in the Castle, Sherer said that each event drew 10,000 spectators of which two-thirds reported they weren’t local residents and came to Oshkosh specifically for the Paine events.

“These people eat at restaurants, shop at stores, and stay in hotels as part of their visit, so their impact extends beyond the Paine,” Sherer noted.

Such out-of-town attraction can be critical for the local hospitality industry. Bergstrom-Mahler Museum in Neenah estimated its special four-day Arts of Fire event in 2009 generated more than $60,000 for the local economy by non-local visitors alone, according to Jen Stevenson, marketing, public relations and development director for Bergstrom-Mahler. The event attracted visitors from around the country, placing hundreds of “heads in beds” at area hotels as well as assisting nearby restaurants and retailers.

Supporting local arts

WHILE NONPROFIT ARTS and culture organizations contribute to the local economy and enrich countless lives, they in turn benefit from corporate and community contributions. Venues like the Fox Cities Performing Arts Center rely on corporate support to provide several community programs.

“Ticket sales and other earned income alone do not cover the full costs of delivering the center’s mission and presenting live performances,” explained Van Laanen. “Our business model relies on donations from both individual and business annual partners to offer programs like our daytime education series, free community engagement activities and subsidized use of the Center by community groups.

Van Laanen said 71 percent of its Annual Partner Campaign dollars come from corporate contributions.

“That kind of corporate investment makes us unique among our peers nationwide, but, here in the Fox Cities, business leaders get it. They see the value of the arts in their community,” she said.

Local companies also rent the Fox Cities PAC for their own business and staff events.

“Beyond the companies themselves, we look to engage their employees through group sales, backstage tours, special ticket offers and volunteer opportunities,” added Van Laanen.

One staunch supporter in the business community is Darwin Copeman, president and CEO of Jewelers Mutual Insurance Company in Neenah, who serves as a board member for the Fox Cities Performing Arts Center. He noted the symbiotic relationship between the center and the nearby restaurants and hotels, and the intangible value of the arts enriching the quality of life in the Fox Cities in various ways such as educational programs that reach more than 23,000 students each year.

Additionally, the center is among the recruiting tools that can attract new workforce talent to the region.

“These are valuable assets for a multitude of businesses in the area and they should recognize that value through support of the arts as a revenue enhancement and talent attraction for their companies,” said Copeman. “Employers can demonstrate their support for the arts by sponsoring events, purchasing tickets for their employees as incentives or rewards, hosting customers at events or simply making a financial commitment.”

Kevin Ralofsky, president and CEO of CitizensFirst Credit Union in Oshkosh, noted investing in the arts can give communities economic growth and a quality of life that attracts diverse individuals.

“More and more, people make decisions about where they want to live based on quality of life issues. A city with a lively arts community will attract a higher-quality workforce for the business community,” he said.

In addition to attending or volunteering for events or donating money, Ralofsky said businesses also can contribute supplies and serve on boards and committees, and even petition elected officials for increased funding for the local arts from all levels of government.

Plexus Corp. is among the annual donors to the Fox Cities PAC and also recently began contributing to a capital campaign.

“The PAC is important to us for several reasons: We like the strong educational outreach program of the PAC and recognize the impact that has on the community as well as the families of our employees,” said Joe Mauthe, senior vice president – global human resources. “We also believe that the PAC is important in the quality of life for our employees and also in attracting new employees and their families to the Fox Cities, and we’ve also used the PAC for team-building and employee recognition.”

Plexus also has more than 100 works from local artists throughout its new headquarters building in downtown Neenah.

“It’s a great way at making our workspace more attractive and giving recognition and support to some very talented artists in our community,” noted Mauthe.

To help keep The Grand Opera House experience at an affordable rate for patrons, the organization aims for an industry-standard 40 percent of its operating budget being achieved through individual, business and corporate support, according to Ferlo.

“Whether it’s a major sponsorship, a small-business relationship, or a donation of goods or services, regional businesses are a big part of making the arts successful in our communities,” he said. “One of our 2013 initiatives includes creating, developing, and implementing a program that allows smaller businesses more diverse opportunities to become involved.”

Attorney Jim Macy, a partner with the law firm Davis & Kuelthau, s.c. in Oshkosh and Green Bay, is another business leader who recognizes what the arts mean to communities and companies.

“Many community downtown sections are comprised of small businesses that provide unique products and services not generally found in the outlying centers,” he explained. “They bring a certain charm and history to each community. They become a gathering point. They exist only to the extent they can remain economically viable. A landmark like the Grand Opera House anchors a downtown community and assures hundreds if not thousands of visitors to downtown Oshkosh. They shop the shops and dine in the restaurants. They keep small businesses viable, which in turn maintains employment opportunities to those that work in them.”

Sometimes the bottom line can be about more than money. Said Macy, “While some may think businesses sponsor shows for marketing and name recognition, the reality is that many businesses sponsor shows at The Grand as a benefit to their employees and as pride in their community.”

Robin Bruecker has 16 years experience in magazine and marcom writing. Contact her at robinbrueck@yahoo.com.