If an investment is best judged by its rate of return, then the small sales tax that metro-area residents pay to support science and culture is a remarkably fruitful use of money.
The Colorado Business Committee for the Arts recently released a report on the economic impact of institutions supported by the Scientific and Cultural Facilities District (SCFD). The district raises about $38 million a year by collecting a 0.1 percent metro sales tax, and it distributes the funds to more than 300 non-profit cultural institutions, ranging from large attractions like the Denver Zoo to small theater groups.
The study has been updated every other year since 1992. This one found that in 2005, scientific and cultural facilities generated $1.4 billion in economic activity. The study estimated that the $38 million in tax revenues helped bring $387 million in “new” money (cultural tourism spending and government grants, among other things) into the metro-area economy.
Not a bad return on that investment of $38 million.
The study found that the facilities surveyed paid more than $16 million in taxes and about $95 million in wages to 10,800 employees, an aggregate number greater than the individual workforces of such top employers as Qwest and King Soopers. Cultural employment has grown by 6,100 jobs since 1997.
The SCFD tax, of course, isn’t the sole factor behind the economic success of those cultural institutions, most of which existed before the district was created and all of which have multiple sources of revenue. What the SCFD has done is to help broaden the appeal of area cultural facilities because of the district’s requirement that recipient organizations provide some free days or admissions or services to the general public. The committee’s study found that 2005 cultural attendance in the metro area was 14.1 million visits, compared to a figure of 7.9 million for the larger Dallas-Fort Worth metro area.
As impressive as the study’s findings are, they don’t paint the full picture. Much of the region’s thriving cultural scene isn’t covered by the study because hundreds of venues from Red Rocks to Golden Triangle art galleries don’t receive money from the SCFD.
The Colorado Business Committee for the Arts reports that it’s working on ways to more fully measure the impact of the arts on our economy. When it does, the news can only be good.
