On Tuesday, April 23, Cultural Alliance President Tom Kaiden delivered the following testimony on the state of the cultural community and a petition signed by more than a thousand residents calling for the restoration of the Philadelphia Cultural Fund to members of Philadelphia's City Council.
Good evening Council President Clarke and members of City Council. Thank you for the privilege of speaking with you today.
My name is Tom Kaiden and I am the President of the Greater Philadelphia Cultural Alliance which represents over 400 regional museums, theaters, libraries and cultural organizations, nearly 3/4 of which located here in the City of Philadelphia.
And although this is a budget hearing, today I actually want to talk about receipts--how arts and culture can make Philadelphia better, and how we can help bring more revenue into our City’s coffers.
This past year, we published an important economic research study that shows that arts and culture generates $2.8 billion in economic impact for Philadelphia County. This spending supports nearly 30,000 jobs, and returns $59 million in much-needed municipal tax revenues for the City. $59 million in tax receipts. That money is a return on the city’s historical investment in arts and culture.
That said, the arts impact is now clear, but our City’s cultural assets face two serious challenges in the years ahead.
The first one is internal. Half of Philadelphia’s cultural organizations are now operating in the red. Average operating margins, which had already been thin before the recession, have dropped from +2% in 2007 to -9%. Why is that? Because despite rising sales of tickets, memberships and subscriptions, there have been substantial cuts to foundations, corporate and government support that have left too many cultural organizations on the verge of bankruptcy.
Such a collapse would threaten the city’s reputation as a world class cultural destination. We spend millions of dollars on marketing for tourism, conventions and economic development with the promise of great food, great entertainment and fantastic arts and culture. What happens if we can’t open the doors? Will visitors return? What will they tell their friends and neighbors about us?
The second challenge is external. While Philadelphia has reduced its funding over recent years, other cities and regions are making big investments in their cultural product to capture market share, jobs and tax receipts. They are coming after us. Here specifically is what the competitive threat looks like.
- Minnesota is investing $1.2 billion in arts and cultural heritage over 25 years. That’s roughly $48 million per year.
- Detroit and its surrounding counties have a millage tax that raises $22 million for the Detroit Arts Institute.
- Portland, Oregon just passed an arts tax of $35 per resident that is expected to raise $12.2 million annually in the years to come.
- Pittsburgh’s Regional Asset District raised more than $167 million in 2011 to help fund arts and culture, libraries and parks and other quality of life initiatives.
At the same time, here in Philadelphia, we cut the Philadelphia Cultural Fund, the city’s signature arts funding program, by half in 2010. When you look at what our close competitors spend per-capita on arts and culture, the threat is clear. Philadelphia now comes in last, behind New York City, San Francisco, Portland, Charlotte, Denver and even Pittsburgh. These cities are all going after our cultural tourism dollars, our highly-skilled workers and our employers and they’re investing in a vibrant cultural scene to do it.
Ironically, the City of Philadelphia actually wrote the game plan for a competitive creative sector. This Council created the first Percent for Art program in the country. Your funding for the Mural Arts Program, the Cultural Fund, the Office of Arts, Culture and the Creative Economy, the Philadelphia History Museum and the African American Museum have made this city unique.
Today, the hard truth is that we can’t afford to coast on the bold policies of the past. If we want continued growth, if we want to keep reading about Philadelphia as the #1 cultural destination in the country, then we need to increase funding for the arts. The long term solution is sustainable dedicated funding like they have in Minnesota and Pittsburgh, but that will take a lot of hard work and enabling legislation from Harrisburg. We’re up for the fight, and we hope you’ll join us.
In the short term, there is some triage we need to do now, in this budget. Restore the Philadelphia Cultural Fund to $3.2 million. Doing this would cost residents of Philadelphia an average of $1 per person per year. Today, I bring to you a petition signed by more than a thousand Philadelphians who would be happy to pay that extra dollar. They understand, as you and I do, that arts and culture are a source of pride for the city and a crucial economic engine. I hope we have your support.
Thank you for your time.
*Chart Sources: Pennsylvania Cultural Data Project (Philadelphia), Scientific & Cultural Facilities District (Denver), Allegheny Regional Asset District (Pittsburgh), Arts & Science Council (Charlotte), New York City Department of Cultural Affairs, Creative Advocacy Network (Portland), San Francisco Arts Commission. All financial figures are from either published reports or direct communication from each agency or organization.
Census 2010 figures used for all geographies to calculate per capita figures
