Pretty profit

The ROI of arts spending

/wp-content/uploads/2022/11/BR_web_311x311.jpeg

The 1,500 people attending the Bravo annual gala Saturday night will be all dressed up to celebrate arts and culture while doing a little dancing. The annual February event is one of the largest galas in Greater Des Moines.

It’s put on by Bravo Greater Des Moines, an 11-year-old organization that is charged with allocating some $3 million in hotel and motel taxes collected in 15 metro area cities and unincorporated Polk County to about 50 arts, culture, heritage and educational organizations. 

And Bravo officials say they have plenty to celebrate. The organization is expanding its staff, looking at what new roles it might play in encouraging and supporting the arts and culture community here. A recent study by Iowa State University economist Dave Swenson indicates that the economic impact of Bravo grants is growing.

And this year, Bravo will participate in a national survey of 280 cities for an economic impact study that will be released in 2017. Americans for the Arts is sponsoring the study, and by next year, said Bravo Executive Director Sally Dix, her organization will have a sense of how Greater Des Moines compares with other American cities in terms of the health and vibrancy of its arts and culture scene. 

Until that point, Bravo has periodically hired an economist to look at the economic impact of the organizations it funds, so the most recent study can be compared to studies conducted in 2007 and 2012, said Dix. But the Americans for the Arts study will be the first opportunity for Greater Des Moines to see how it compares with other communities in terms of arts and culture.

Bravo’s allocation of $3.3 million in hotel and motel taxes and contributions in fiscal year 2015 had an economic impact of $120.9 million, according to a study performed by David Swenson, an associate scientist in the economics department at Iowa State University.

“People understand and appreciate how important the arts are to our quality of life in Greater Des Moines, but that’s not the whole story,” Dix said. “The arts are wonderful as a ‘nice to have.’ They’re also a ‘need to have’ as an economic driver, and we want to be more robust in telling that story.”

Bravo is required to report to the cities that fund it, and economic impact studies can be useful in providing at least one measure of its impact. “We have to demonstrate (return on investment). We have donors, and those donors want to know that we’re investing their money wisely,” Dix said.

“These organizations took $3 million from Bravo and turned it into $120 million in economic output,” she said. “I think that’s a pretty good ROI for the cities to understand that the investment they’re making is really leveraging a great deal.” 

Dix said Bravo grants typically are no more than 5 percent of an organization’s total budget.

“We want to make sure the organizations are healthy and have a diverse portfolio of donors and have stable revenue streams for the long term,” she said.

Of that $120.9 million, $45.2 million was labor income to 2.336 people who work for the organizations, and another $73.4 million was value added by out-of-town visitors (about a quarter of total attendance) who visited the arts and culture groups that received grants and presumably stayed in hotels, dined in restaurants and otherwise spent money in Central Iowa.

While 2,336 jobs is a tiny chunk — about half of 1 percent of all jobs in Greater Des Moines’ combined regional economy, which has $29.4 billion in total personal income — it nevertheless shows a growing return on investment, Dix said.

Comparing the 2015 economic impact study to one from 2012 showed a 9 percent growth in jobs, both direct and indirect; a 3 percent growth in out-of-town visitors to the organizations; and an overall increase of 6 percent in economic output, she said. 

Dix said it’s fortunate that the total amount of revenue being generated through the area’s hotel-motels taxes has increased year to year. So has the number of organizations Bravo can finance.

The number of organizations Bravo has financed has doubled since the group was formed in 2004 and grown 33 percent in the past four years. “We’re so grateful that the trends are up,” Dix said.


Portrait of growth

Municipal contributions to arts and culture organizations have been growing, but so has the economic return on those contributions.

Total regional economic output
2015: $120.9 million
2012: $114.1 million

Jobs created/maintained (direct and indirect)
2015: 2,336
2012: 2,144

Labor income 
2015: $45.2 million
2012: $41.3 million

Added value (Additional spending by out-of-town visitors) 
2015: $73.4 million
2012: $57.2 million 

Source: “The Economic Value of Arts, Cultural, and Heritage Organization to the Central Iowa Economy,” 2012 and 2015 reports, by David Swenson.


Bravo hires third employee

Rachel Woodhouse, a donor relations coordinator for Des Moines Performing Arts, will become a community impact specialist for Bravo Greater Des Moines later this month. Woodhouse will become Bravo’s third full-time employee.

Woodhouse will be responsible for managing and evaluating Bravo’s grant-making programs and enhancing its community engagement. She will provide essential support as Bravo looks at other ways it can enhance the role of arts and culture as a key driver of quality of life in the region.

Woodhouse has also held leadership positions on the Des Moines Art Center Art Noir board.