Bacon's Rebellion

James A. Bacon


 

Baconometer

Frying

Alms for the Arts

 

Brad Armstrong wants to raise $163 million in public and private funds to support Richmond's performing arts and downtown revitalization. The causes are worthy. But is he asking too much?


 

If you spent a morning chatting with Brad Armstrong, as I did last week, you’d have to be a philistine not to leave his office dazzled by his vision for the Virginia Performing Arts Center in downtown Richmond. Armstrong, who left his job as a partner in the Martin Agency three years ago to breathe life into a set of architectural renderings, makes a strong case for investing in the arts center.

 

The first and largest phase of the $163 million project would transmute a full city block of musty, boarded-up buildings into an architectural gem – creating a first-class venue for song, dance, theater and music, and completing the revitalization of a convention/hotel district in the heart of downtown. The complex would house a renovated Carpenter Center, a jazz club, a high-tech music hall and facilities for community-based groups such as the Elegba Folklore Society and Richmond Boys Choir.

 

I have no doubt that the arts center would be a tremendous asset for Virginia’s capital city. Yet I am conflicted. The master plan, which also includes renovations to the old National, Empire and Landmark theaters, calls for a massive commitment from the community. Financing would require a local meals tax, a regional lodging tax, roughly $30 million in state support and multi-millions in private support.

 

While the Performing Arts Center unquestionably would be worthwhile, so would a half dozen other civic projects in the Richmond region that are vying for funding – and dozens more that may never be conceived. The arts center is so grandiose in scope, I fear, it will preclude consideration of other ideas. Richmond’s movers and shakers feel so tapped out by existing commitments that they have little appetite for new projects of any kind.

 

Brad Armstrong is the prototype of what I call the “civic entrepreneur” – that rare individual at the intersection of government and the private sector who possesses the imagination to conceive a bold new project, the diplomatic skills to rally people behind him and the determination and creativity to surmount the inevitable obstacles. Civic entrepreneurs are indispensable: Without them, our communities would be greatly impoverished. But if their ambitions are too grand, they can suck up the political and philanthropic oxygen that might support other projects.

 

Armstrong would be horrified, no doubt, at the suggestion that the Performing Arts Center is crowding out other initiatives. He regards the project as inherently inclusive: an umbrella for performing arts groups from around the city, including those from the African-American and Hispanic communities that have never enjoyed access to state-of-the-art performance halls. One of the reasons for the high price tag of the Performing Arts Center is that it includes a $15 million endowment that would subsidize access for not-for-profit groups that could never afford first-rate facilities on their own.

 

Such efforts are praiseworthy, but they take place in a vacuum. The arts complex is on center stage largely because Armstrong put it there through an exertion of will. Of course, Richmond is no different than any other region in Virginia. Indeed, it may even be a step ahead of the game. At least Richmonders have commenced a conversation about what it takes to prosper in a globally competitive economy in which prosperity springs primarily from its ability to develop, recruit and retain human capital. But there remains a disconnect between the new ways of thinking about the future and the civic projects that have been moving through the fund-raising pipeline.

 

Here are the kinds of questions that Richmond -- and every other Virginia region -- needs to be asking:

 

Where should communities prioritize their allocation of finite political and philanthropic capital -- to projects that bolster their wealth-creating capacity, projects that promote social justice, or projects that improve the general quality of life?

 

Which should lay a great claim on resources? Hard infrastructure like roads, industrial parks and real estate developments? Universities, research centers and other knowledge-creating institutions? Civic booster projects like downtown face-lifts, convention centers and ball stadiums? Or investments in “quality of life” such as healthcare, parks and trails, clean rivers, museums, performing arts or -- too rarely considered -- the pattern and density of land use?

 

Thanks to Richard Florida’s path-breaking work in the Rise of the Creative Class, communities like Richmond comprehend the necessity of investing in quality-of-life initiatives. To prosper, regions must succeed in recruiting and retaining members of the “creative class,” those artistically, scientifically and entrepreneurially gifted people who contribute disproportionately to economic growth. That means providing the kinds of amenities that the “creatives” enjoy.

 

Superficially, that could be construed as an argument in favor of building an arts complex. But another question arises: What kind of arts do the younger, mobile members of the creative class – particularly the so-called Young & the Restless in the 25-34 age range -- prefer? Do they frequent grand ballrooms and theaters, or are they, as Florida suggests, more drawn to music and art that arises organically from “the street.”

 

Finally, given that a region can afford to support only a finite number of civic projects, how should leaders manage the regional “portfolio” of initiatives? Should leaders demand a measurable return on investment? If not, are they willing to acknowledge failures and pull the plug? What appetite for risk does the region have? Should it invest in high-impact projects with high sunk costs and big risks – like Richmond’s failed Sixth Street Marketplace – or spread the risk by supporting more grass-roots initiatives where the cost of failure is negligible?

 

The idea for a performing arts center originated seven years ago when Armstrong was serving as the volunteer president of the Arts Council of Greater Richmond. The Council and a spin-off, the Alliance for the Performing Arts, began pushing for a master plan to develop the region's arts "infrastructure" -- theaters, music halls and other facilities. Over the next few years, these allied interests scraped together enough money to hire consultants and put some credible numbers together.

 

In February 2001, the arts community unveiled its vision for a three-phase project, beginning with rehabbing the "Thalhimers" block downtown -- the location of the long-defunct Thalhimers department store -- moving on to the Empire and National theaters on Broad Street, and then rehabbing the Landmark theater adjacent to Virginia Commonwealth University.

 

About the same time, the business leadership was looking for a solution to the Thalhimers block. The city had invested some $180 million to build a new convention center, and it dawned on civic leaders that the adjacent Broad Street corridor was a festering eyesore of tacky stores, vacant buildings and poor people switching bus lines -- not the kind of ambience likely to attract major conventions. The Performing Arts Center looked like a way to inject some economic vitality back into the area.

 

Armstrong had a great job at the time as a partner in the Martin Agency, the largest advertising agency in the Southeastern states. Having brought the arts project this far as a volunteer, he had no thought of taking it past the concept stage. But grocery magnate Jim Ukrop, hotelier Booty Armstrong and attorney John Bates put the squeeze on him. As someone who bridged the arts and business communities, they told Armstrong, he made the ideal candidate to bring the project to fruition. Ukrop arranged office space for the Performing Arts Foundation at his First Market Bank office downtown, while various private entities kicked in for Armstrong's salary.

 

Armstrong set about recruiting a Foundation board, with twin goals in mind: reflecting the ethnic and geographic diversity of the region, and finding people who could help raise funds. He called the first board meeting, at 8 a.m., Sept. 11.... 2001. On the day the terrorists struck, the stock market took a dive, philanthropists' net worth shriveled, uncertainty reigned, and civic ventures across the nation put their plans into the deep freeze.

 

But Richmond doesn't have the luxury of waiting for a rebound, Armstrong contends. In 2007, Virginia will celebrate 400th anniversary of the founding of the Jamestown colony -- literally, a once-in-a-lifetime event. One million tourists are expected to visit Central Virginia and nobody wants Broad Street, the city's main thoroughfare, looking like dog dreck. Last year, the city approved a Community Development Authority that raised $66 million to tear down dilapidated buildings, build parking lots and install streetscapes -- an investment that in turn sparked private commitments to build a new hotel across from the convention center. Soon after, Congress appropriated funds for construction of a new federal courts building. The only missing piece is the Thalhimers block. 

 

The Performing Arts Center will fill that hole with a signature piece of civic architecture. The design has a timeless quality -- not tied to any specific era -- yet it maintains consistency with downtown's architectural heritage. The main facade on Broad Street will display traditional elements such as stone building materials, columns and cornices. At the same time, extensive use of glass will invite people to view the activities inside, be they Elegba dancers practicing on the ground floor or guests milling in the reception hall. Seven statues will represent music, dance, theater and other art forms within.

 

Armstrong's immediate challenge is finding roughly $113 million to get the Thalhimers phase of the project up and running in time for the Jamestown quadricentrennial. The complex will bring in some rental revenue -- including receipts from traveling Broadway shows -- but not enough to cover operating expenses. Armstrong anticipates an ongoing annual deficit of $750,000, to be funded through a $15 million endowment. No arts center in the country, he notes, makes an operating profit.

 

The city of Richmond has committed to the first $27.8 million by imposing a one percent increase in the meals tax. Meanwhile, Armstrong is pushing a regional hotel occupancy tax to raise another $14 million. That tax, he notes, is backed by the hotel/motel association on the grounds that a performing arts center would help attract more conventions and mean more business for everyone.

 

Unfortunately for Armstrong, Chesterfield County has yet to warm to the tax. Chesterfield politicians can be forgiven for wondering how much a performing arts center in the city would stimulate the hospitality industry south of the James River.

 

Meanwhile, the Foundation has twice approached the legislature for some $30 million in state financing -- considerably less than the amount that could be issued in bonds and supported by an estimated $3.7 million a year in taxes generated by the state -- but, given the fiscal crisis of the past few years, did not get an encouraging response.

 

Frankly, Armstrong's case to the Commonwealth has holes. Even assuming that the $3.7 million in state tax revenue can be legitimately attributed to the arts center, as at least one economic impact study concludes, it's not clear how much of that sum would represent a net gain to the state. If Virginians weren't spending their entertainment dollars at the arts center, they would be spending them somewhere else -- most of it, presumably, in Virginia. The arts center, it can be argued, wouldn't be creating new economic activity as much as it would be redistributing it from one venue to the other.

 

Some of that tax revenue would represent a gain to the state, Armstrong argues. Many affluent Richmonders patronize the arts in other cities where the facilities and amenities are superior. There's no way to pin down a figure, he concedes, but it could be substantial. Additionally, an estimated 17 percent of the $3.7 million in revenue to the state would come from out-of-state tourists. "We use this conservative estimate in our analysis and note that we would expect that the [actual] proportion of out-of-state visitors would be higher."

 

Furthermore, Armstrong says, the economic impact analyses don't include revenues from increased convention traffic, which would include many out-of-state visitors and would boost the $3.7 million number higher. Nor do they take into consideration the benefits to local industry: If Richmond has a vibrant arts scene, corporations may find it easier to recruit top executive and managerial talent. Philip Morris USA and Wachovia Securities have relocated several hundred employees from New York to Richmond in just the past year. A facility like the Performing Arts Center, says Armstrong, would have made their job easier. As those companies have told him: "In New York our employees have Broadway. In Richmond our employees have Broad Street." Then he adds: "We need to make Broad Street Richmond's equivalent of Broadway if we want to attract the best and the brightest."

 

That's the case Armstrong will have to take to the Richmond business and professional community. The three-phase project requires about $55 million in private donations. Having raised roughly $13 million in commitments so far, he's launched into full fund-raising mode. Now that it has unveiled the final architectural renderings, the Foundation is offering "naming opportunities". The name of every theater, auditorium, atrium, promenade and courtyard in the complex is up for sale. Armstrong is optimistic that the community will respond.

 

Let's assume, for purposes of argument, that investing $55 million into the performing arts is the highest and best use of Richmond's finite philanthropic capacity -- that these funds are better spent on the arts than, say, supporting higher education or healthcare. Is building a giant arts complex really the best way to stimulate the arts?

 

Even Armstrong draws a distinction between cultural  "hardware" and "software". By hardware, he refers to the physical settings where the arts are performed -- the stages, music halls, dressing rooms and buildings that house them. By software, he refers to the performing arts organizations themselves -- not just the symphony, opera and ballet but the jazz society, the theater troupes, the choirs, the ensembles and the chamber orchestras.

 

Every arts group needs hardware: somewhere to practice and perform. By addressing the needs of all groups in a master plan -- a plan that provides a wide range of settings from a 1,150-seat music hall to an 80-seat experimental theater -- the Foundation will provide first-class facilities that every arts organization craves but very few could afford on their own.

 

But what's more important -- the stage or the performer? Could that $55 million be better spent on software: supporting arts organizations directly?

 

"Of course there must be a balance," says Armstrong. "It would be foolish to spend all of our resources on facilities and have nothing left over for the organizations that use them." That's why the Arts Council has set up an umbrella arts fund, which operates like the United Way to allocate charitable donations where they can do the most good, whether to large, established organizations, smaller groups or start-ups.

 

That sounds great in theory. How will the Arts Fund work in practice if major donors are funneling their contributions into the Performing Arts Center? We'll have to wait and see.

 

One more question: Are the performing arts inherently elitist? There is a vibrant "street" music scene in Richmond that doesn't rely on government funds and philanthropy. It thrives because young people are actually willing -- get this -- to pay what it costs to put on the shows. And it thrives because there's a demimonde of clubs, bands, agents and concert organizers who, in the purest of free markets, hustle to provide people with the kind of entertainment they want.

 

Because most of these people come out only at night, this netherworld is largely invisible to Richmond's business leaders. And if the nightlife entrepreneurs did step into the light of day, the tattoos and lip rings probably would frighten off most Main Street sponsors. But the clubbing scene is where much of Richmond's artistic energy resides.

 

The publishers of SaveRichmond.com -- who have contributed to Bacon's Rebellion (See "Boats Against the Current," Feb. 2, 2004) -- have listed a series of inexpensive reforms and initiatives that could stimulate the local music scene. Lighten up on the nightclub regulations. Hold an annual music festival. Release a CD of locally recorded music. Publish an annual entertainment guide. Encourage the development of independent media.

 

Armstrong is genuinely very ecumenical in his support of the arts. He thinks many of SaveRichmond.com's suggestions are great ideas and would like to see them happen.

 

Here's the thing: The city has imposed a meals tax -- which falls disproportionately on Richmond's for-profit nightclub culture -- to raise funds to support Armstrong's not-for-profit arts crowd. To my knowledge, none of the tax dollars is being set aside to advance the SaveRichmond.com agenda.

 

I'm 51 years old, married, with a six-year-old at home. My wife and I aren't up to partying past 2 p.m., drinking beer and listening to hip hop in a Shockoe Bottom nightclub. The Jazz Club in the Thalhimers complex sounds more like our speed. Personally, my artistic tastes run much closer to Brad Armstrong's than to those of, say, my two teenage daughters, both of whom love the concert scene.

 

But do I think it's fair to tax Richmond's young people to support my lifestyle? No, I really don't.

 

Do I think a performing arts complex is the best place for private donors to invest $55 million for the betterment of the community? At least they're giving their own money away. I can see both sides of the issue. I'm still chewing that one over.

 

-- July 26, 2004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fire back!

 

You can berate Bacon at jabacon@

baconsrebellion.com

 

Or read his profile here.