Press Release: Reston 20/20 analysis of proposed Reston visual and performing arts center shows it will be costly and require tax increases.

 PRESS RELEASE

December 9, 2022

 

Reston 20/20 analysis of proposed Reston visual and performing arts center shows it will be costly and require tax increases.

 

In a detailed analysis released today, December 9, 2022, Reston 20/20 analyzes the 20-year future cost of building and operating a visual and performing arts center in Reston Town Center as $164 million.  The report details how over half of that cost will require tax increases for Reston or county taxpayers.

The analysis, based on the recent experience of non-profit performing arts centers nationwide and several feasibility studies of prospect arts centers, fills a void left by Fairfax County and the Reston Community Center (RCC) which have provided no analysis of the center’s prospective financial burden to date.  The only financial RCC’s consultant provided was a rough order of magnitude forecast that the proposed arts center would cost $81.4 million if built in 2030, probably the earliest date one could be completed. 

The Reston 20/20 analysis, prepared by long-time Restonian Terry Maynard, details of the financing cost for building such an arts center over 20 years, estimating the cost over that timeframe at $135.9 million.  The report adds that the cost could increase more than the three percent per year assumed due to construction cost escalation, greater inflation, and delays in launching construction.  If financed by Restonians alone through STD#5, construction would require a 46% increase in the local tax rate in 2030.

The operating costs of such an arts center—some $28 million over 20 years--also pose tax challenges.  The report notes that the nationwide non-profit theater industry has only been able recover about 42% of its operating costs through annual revenues, relying on outside sources—taxes, endowments, donations, etc.—for the remainder.  Start-up arts centers have generated only about 22% of the revenues needed to meet expenses, escalating to 42% over several years.  Reston 20/20 forecasts these costs would require an eight percent increase in Reston tax rates in 2030 if RCC managed the center.

“The county and RCC have failed to provide the community any reasonable estimate of future costs associated with the proposed arts center,” according to Terry Maynard.  “While RCC has asserted it could manage the theater in a more streamlined manner than others have, it has not conducted the analysis to show how this might be achieved or the impact on existing RCC offerings.  It is irresponsible to proceed with the consideration of a Reston VPAC without a detailed estimate of the center’s future impact on Reston and county taxes,” he added.

The report says, “Reston and Fairfax County have much more important needs for the use of their tax dollars over the coming decades (including) more schools, improved transportation capabilities (transit, pedestrian/bike, and auto), urban parks, and protection of the environment, among others.”  According to the report, there are at least 31 visual and performing arts centers of varying sizes within 10 miles of Reston.

The report concludes that, if a performing arts center is to be built in Reston, “it should be a county arts center as described in the Reston (Master) Plan entirely funded by the county—including all construction and operating costs.”

##############