Culturing Business in O.C.

Ingram Micro co-chairman David Dukes enjoyed the recent Stomp performance at the Orange County Performing Arts Center on two different levels.

To start, the human percussion machine that tapped and banged its way onto the 10-year-old center’s stage presented a tremendous show. But Dukes also enjoyed using the ensemble’s sights and sounds to help court executives at a Japanese company that’s considering doing business with Ingram Micro, the world’s largest computer products distributor.

And, as usual, Dukes said, the $73-million, privately financed center proved to be an attractive lure.

“Most visitors figure that we have a performing arts center here in Orange County,” Dukes said. “But they’re almost always overwhelmed by the physical facility. Coupled with the level of programming we have at the center, it’s an overwhelming plus when it comes to recruiting potential employees and customers.”

The center’s 3,000-seat Segerstrom Hall can bolster business opportunities--be it courting potential employees, impressing visiting customers or rewarding hard-working employees. It’s one of the many ways that nonprofit arts organizations contribute to the health of the local economy.

“Having a well-represented and well-developed arts community is an important draw for businesses in Orange County,” said Anil Puri, a Cal State Fullerton economist. “A solid arts center is an image-building thing, just like having Disneyland or the Angels.

“The advantages of that sort of thing can’t always be quantified,” Puri said. “But a lot of people do surveys of the attractiveness of certain places to live or work, and the arts, while hard to quantify from an economic sense, are always part of that picture.”

At a time when government budget-cutting and corporate downsizing has reduced potential funding sources, institutions such as the Performing Arts Center are scrambling to gather data that tell potential contributors about their impact on the local economy.

The Civic Arts Plaza in Thousand Oaks, for example, hopes to contract with the UCLA Anderson Graduate School of Management for a study that will document its impact on the local economy.

While it’s difficult to measure the economic benefits that a solid arts organization can contribute to a region’s image, it is possible, economists say, to chart more down-to-earth considerations.

A 1994 survey of 49 local nonprofit arts organizations and museums, including the Performing Arts Center, suggests that the nonprofit arts sector has a noticeable impact on the local economy. The Chapman University survey, conducted for the Costa Mesa-based Orange County Business Committee for the Arts, is being updated, but it doesn’t break out the economic impact of individual institutions.

But the report does suggest that the direct economic impact of the county’s major nonprofit arts institutions was $67.5 million in 1993. That total includes direct spending by organizations on salaries and operating expenses.

Indirect spending--the amount of money spent as museum workers and center directors use their paychecks to buy goods and services--totaled $194.9 million in 1993, according to the survey.

Indirect audience spending--for meals, drinks, transportation and related things--hit $86 million during 1993.

Add those elements together, the survey says, and the total economic impact of the nonprofit arts community on Orange County is $348.5 million.

Statewide, economists say, the arts are an increasingly important part of the economy.

Figures gathered by the California Arts Council in 1994 indicate that the state’s nonprofit arts institutions sold nearly 24 million admission tickets during 1993 with a value of nearly $200 million.

The study conducted by KPMG, the accounting firm, argues that the arts scene has created more than 115,000 full- and part-time jobs in California, and that the arts sector adds $1 billion to the California economy.

Hycor Biomedical Inc. Chairman Richard D. Hamill, who, like Dukes, is a member of the Performing Arts Center’s board of directors, will be in attendance when 1,900 of the center’s supporters gather for a celebratory fund-raiser.

Hamill described the center as an increasingly important part of Orange County’s allure--especially when it comes to convincing people that there’s cultural life outside of Los Angeles.

“It’s a fabulous incentive when it comes to recruiting people to Orange County,” said Hamill, who occasionally schedules performing arts center visits to help woo out-of-town job prospects. “I’m not sure how you quantify those benefits, but it’s probably something like trying to run your business without good schools.

“The center would be conspicuous by its absence.”

Arts and Dollars

Orange County’s nonprofit arts organizations help fuel the economy by generating direct and indirect spending of nearly $350 million. Most of that impact is from arts employees and vendors. Dollar amounts in millions; information for 1993, the most recent available:

*--*

Indirect by Direct Indirect audience Performing arts $48.0 $138.0 $75.1 Museums 8.4 24.2 1.4 Other 11.4 33.0 9.5 Total $67.8 $195.2 $86.0

*--*

TYPES OF SPENDING

* Direct: Wages and operating expenses

* Indirect: Spending that occurs when arts employees use their wages and vendors use their receipts to purchase goods and services

* Indirectly by audience: Restaurant meals, drinks, transportation

Source: Center for Economic Research, Chapman University; Orange County Business Committee for the Arts; Researched by JANICE L. JONES / Los Angeles Times