RI State Economy Benefits From Preservation: Report

NEWPORT, RI — A new study says the state economy gains $1.4 billion from tourists who come to admire Rhode Island's historic buildings, according to the Preservation Society of Newport County. And that's only one way preservation brings in money, according to author Donovan Rypkema, of Place Economics. His report, which was paid for by the van Beuren Charitable Foundation, based in Jamestown; Rhode Island Historical Preservation and Heritage Commission, and the National Trust for Historic Preservation, is being called the first "to analyze Rhode Island's preservation sector on four main themes: Heritage Tourism, Historic Tax Credits, Quality of Life and Sustainability," the Preservation Society said.

"What we found is Rhode Island's historic cities, towns, and neighborhoods attract visitors, residents, businesses, and investment," Rypkema said. "The assets of past centuries are the base of a 21st century economy and are often locations of choice for today's Rhode Islanders."

The study touches on ways local communities also reap benefits, but the impact on the state economy was the main question the study was meant to answer, according to Trudy Coxe, the preservation society's chief executive officer and executive director. Up until now, the leading preservationists in Rhode Island could not say exactly how much preservation is worth. Now they can, she said.

In 2014, a local study was published to show the economic impact on Newport. It came to $110 million annually.

"That was also a number we did not know," Coxe said. That study is outdated now, and the figure should be higher because more people are coming to the mansions. They spend money while they're in Newport. The state, for example, collects the lion's share of the meals and beverage and hotel taxes that can be attributed to Preservation Society visitors, but the city keeps one percent. According to the new study, local workers and businesses benefit with $1 billion in paychecks because visitor spending "creates jobs for 19,000 workers directly, and another 7,000 indirectly." A chart shows more than 6,000 "direct" jobs come from sales in the low paying food and beverage sector. Retail sales, and lodging come next followed by recreation, entertainment and admissions; and finally, transportation inside Rhode Island.

The Preservation Society, which attracts the most visitors statewide, employs about 100 fulltime workers and 300 seasonal, according to Andrea Carneiro, communications director. She declined to say how the salaries stack up to the minimum wage.

"Employee wages are a personnel matter, and confidential," she said.

But in addition, the 2014 study showed, the Preservation Society purchases goods and services from local companies. So do people and organization that rent the properties for weddings, parties and other events.

As for the impact on residents and taxpayers, Carneiro confirmed Newport does not collect any property taxes from the Preservation Society, due to a state law which exempts its historic properties. That exemption includes The Breakers, Marble House, Rosecliff, The Elms, and the other mansions. It has 11 historic properties, not all in Newport. But other properties, such as a warehouse, are taxed.

The state does not make payments in lieu of taxes (the so-called PILOT program) for the Preservation Society, Coxe said. It does for Newport Hospital and for Salve to compensate Newport for the costs of being the host community. Currently, museums are not eligible for PILOT, she said. Maybe that will change someday.

Meanwhile, Coxe said, the Preservation Society contributes $50,000 annually to the City. And it makes other donations.

Asked about contributions for police and fire response, Carneiro said the City does not bill the Preservation Society for those services. However, the "Preservation Society pays thousands of dollars every year for police and fire details, and our rental clients pay thousands more for third party events," she said, referring to special events that require one or more officers to direct traffic and perform other safety functions.

Here are the new study's key findings, according to the press release.

· RI welcomes 9.8 million heritage visitors annually, who add nearly $1.4 billion to the state's economy.

· Spending by heritage visitors creates 19,000 direct jobs, and another 7,000 indirect jobs

· Since 2001, 326 historic buildings have been rehabilitated in 26 of the state's 39 communities using state historic tax credits.

· Every dollar the state invests in a tax credit project generates $10.53 in economic activity.

· 56% of Rhode Island's population growth since 2000 has occurred within local historic districts, which comprise only 1% of the state's land area.

· Preservation is green: the reuse of one 40,000 square foot historic building is equivalent to taking 24-28 cars off the road and preserving 4.2 acres of greenfield land.