AFTA Journal

November 2002

STRENGTH IN NUMBERS

The cultural community is in the midst of a financial crisis, and we are summoned to declare our importance to the city without apology. The jobs provided by cultural organizations, the private contributions leveraged, the tourists attracted to New York--all make cultural funding a good investment of City funds, especially in the current budget emergency.

With the likelihood of a mid-year City budget cut facing the cultural community in November, we need to be clear about our value to the city. As the fiscal crisis worsens, every City expenditure is a candidate for reduction, so we must speak with one voice about the positive benefits of continued City support for the arts. The terrible events of 9/11 brought us together in defense, just as the Cultural Blueprint process did in looking forward. We will need the same unity in making our case in the coming budget process, but we will need something more--factual information.

The case for public support of the arts is based on three principles: the value of culture to New York's quality of life; the importance of the arts industry to the economy; the benefits of arts education in the schools. We need to demonstrate these relationships with quantitative and qualitative data. With this information in hand, we can prove that City dollars are well spent. City funding is a good investment in a bad economy because it leverages $4 to $6 in private contributions for every City dollar and strengthens other industries, such as tourism and the commercial arts.

The numbers we gather about economic impact and benefits to schools and communities should be about the people who benefit--the roughly 20,000 jobs provided directly by nonprofit cultural organizations, the thousands of artists working in New York, the hundreds of thousands of students learning to make and appreciate art, the millions of people attending cultural programs throughout the city, including an estimated 15 million tourists who attend cultural activities each year.

Beyond these numbers lies something equally important: the arts as a spiritual resource and a symbol. The strength of our argument lies also in the healing value of the arts, the solace people found in cultural activities after 9/11, the rallying symbol of New York's cultural vitality, the consensus that a cultural element is essential to rebuilding Lower Manhattan, and the good things the arts can do--such as bringing back jobs, restructuring the schools and winning the bid for hosting the 2012 Olympics.

The Alliance will be publishing new research studies in the next several months, covering such topics as the crisis in arts funding and the economic impact of capital construction projects at cultural institutions. This newsletter will regularly provide updated information for a united advocacy effort. Our strength will lie in numbers--in the data demonstrating our centrality to the city and the power of many voices speaking as one.

Randall Bourscheidt
President, Alliance for the Arts

NYC CULTURE FACTS

The arts industry is a potent economic engine for New York. It generates tens of thousands of jobs, billions of dollars in revenues and millions of tourists on a yearly basis. It educates our children and supports lifelong learning for our adults and seniors. It is a symbol of all that New York City stands for, but the public is often not aware of the magnitude of its impact on the city's health. Below are some salient facts:

Nonprofit cultural organizations and the visitors they bring to the city create over $5.7 billion in economic benefits for New York City, and are linked to an additional $12 billion in commercial activity in 2001. (Source: NYS Department of Labor, Alliance for the Arts)

The cultural sector generates tax revenues which are more than twice the amount of support from the City (Source: McKinsey & Company, Alliance for the Arts)

In 2001, the New York City's nonprofit cultural sector generated 54,000 jobs. Approximately 20,000 jobs are provided directly by nonprofit cultural organizations. (Source: McKinsey & Company, Alliance for the Arts)

The Department of Cultural Affairs budget represents less than half a percent of the total New York City budget (0.3 percent) (Source: NYC Independent Budget Office)

CITY BUDGET PROCESS

The New York City budget is not a fixed document; it is a dynamic process. The budget is amended throughout the year to reflect fiscal realities and policy priorities. Major players in the process include the Mayor and his administration, the City Council, the Borough Presidents and Community Boards. Once the budget is adopted in June there can be real-time adjustments made to it throughout the following fiscal year. Below are the critical dates and players in the budget process during the second half of this fiscal year (ending June 30, 2003).


Find out more about the budget process at New York City's Independent Budget Office.

IMPACT OF THE MID-YEAR CUTS

By law, New York City maintains a balanced budget, and deficits must be closed either by raising revenues or cutting spending. Taxes and fees have already risen. It is widely believed that there will be a 9.5 percent expense budget cut to City agencies in November, retroactive to July 1, 2002. If the City's finances worsen further, additional mid-year cuts are possible. The level of these cuts will be determined in part by revenues in the coming months.

The cultural community should brace for the possibility of cumulative reductions in City funding for a period of several years. Already facing tough times since September 11, 2001, many cultural organizations have seen dramatic declines in income from all sources as well as in attendance. Decreased attendance negatively affects earned income, which is the largest revenue source for New York City's cultural organizations. Should City government funding also be cut, the impact could be severe. Organizations with operating budgets below $1 million rely on government funding for up to 28 percent of their funding. For them, a cut of 9.5 percent to the Department of Cultural Affairs budget retroactive to July 1 could be devastating.


WHAT YOU CAN DO

The time to make your voice heard is now. Write to the Mayor or your representative in the City Council. For contact information, see Who Represents Me? below. The cultural community should make its views known before each one of the dates in the budget process.

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