I’ve long been a critic of the Obama Museum, which will not be a “presidential library” but literally just a museum as well as ancillary services and programming. But with the construction now beginning, I finally got around to looking at Obama.org‘s projection of economic impact, and it’s worth evaluating.
Short-term jobs (construction)
The building is expected to employ 3,682 people, with a total of $214,635,630 in “labor income,” during the course of construction. That’s an average of about $60,000 per job — because these are mix of various types of jobs, but all short-term.
Ongoing payroll for the Obama Center is forecast as $19 million in payroll. However, Only 43% of the jobs are expected to be held by South Side Chicagoans, with only 16 people employed in “admissions,” for example, and 10 in “Museum Operations and Administration.” Security guards and janitorial staff will be contracted out rather than directly employed.
The consultants predict $3.1 million in revenue for the planned four-star restaurant and cafe, but recognize that only 25% of the revenue will be “new” (that is, that many of the diners would have otherwise eaten elsewhere). They forecast $6 million in gift shop revenue. They forecast $110K in “net new” private event spending, because 80% of private events held at the venue would have been held elsewhere in Cook County.
The forecast for museum attendance uses an upper bound based on a hypothetical maximum based on the number of opening hours, fire capacity, average visit length, etc., then multiplied by a factor of 30% to reflect utilization, and a “historical and cultural significance multiplier” of 1.15 (that is, the expectation that the Obama museum will be exceptionally popular) — which, honestly, seems fairly suspect. The lower bound is calculated based on actual visitors to real-world presidential museums for recent presidents — but using some math which determines that, even though the highest visitor counts from any of these (excluding the first opening year) was 426,000 for the Reagan museum after it became the recipient of Air Force One, the Obama Museum would have 50% more visitors than even this high, because of the greater size of the Chicago metro area and the number of tourists.
Ticket prices are expected to be $18 per adult, $11 for children, $10 for out-of-state students, and free for in-state students. Parking cost would be $22. In addition, visitors are forecast to spend on average $5 in food purchases and $10 in the gift shop.
Outside the museum, they calculate that visitors will spend
$45 per person for lodging, for in-state out-of-town visitors, or $112 for out-of-state visitors. Why out-of-state visitors would spend more on their hotels is not clear.
$19 per person in retail spending, for in-state out-of-town visitors, or $56 per person for out-of-state visitors. This category is not at all clear to me. Are they saying that people will travel to Chicago specifically for the Obama Museum and, once here, will take in a bit of Magnificent Mile shopping?
$32/$102 per person for spending on food. Again, the only way this makes sense is if they assume the visit will be motivated by the Obama Museum, rather than it being an add-on to an existing visit. Or do they “take credit” for longer visits on the assumption that the Obama Museum will be the tipping point in people deciding on Chicago in their vacation planning?
This was the part that was the biggest surprise: we kept reading about how the Obama Center will contribute to the public good with conferences of various kinds. But those aren’t free. However, it is not clear to me to what extent the registration fees are meant to cover the cost of the event, whether it’s subsidized, whether some participants will have a reduced fee, etc.
Their largest event is planned to be an Annual Summit with 5,000 participants. Each of them will pay on average $577 for the event (the unround number suggests some would be given reduced rates), for a total revenue of $2.9 million for an event expected to cost the Obama Museum $4.2 million. Where the additional funds come from isn’t explained — is it from the endowment?
Air Force One non-sequitur
Finally, the document closes with a slide on the “possible impact of Air Force One exhibit” — but this is an appendix and we don’t know what the accompanying talking points were. Is it meant to suggest that the attendance numbers used for calculating estimates, were overstated? That they hope to get a similar “big draw” here? Dunno.
What about the rest of the Center?
The Obama Center won’t just have a museum.
There will be a new public library branch there. Honestly, it is not at all clear whether the money for this is coming from the Obama Foundation or whether the Public Library is simply using their own budget, and, in fact, whether the space will be provided or rented out. Similarly, there will be a “program, athletic, and activity center” with “recreation, community programming, and events.” Will these activities be provided free of charge, for a fee, or by means of the Chicago Park District using this as a site for its programming?
None of these other activities are reflected in the impact calculations; if the generosity of donors worldwide was expected to benefit Chicagoans through use of Obama Foundation funds on these activities, you’d expect to see them taking credit for this. What’s to be made of its absence?
In any case, the fight against the Museum appears to be over. What remains is a fight to ensure that public funds are not spent on its ongoing expenses. But, unfortunately, Chicago being Chicago, and Illinois being Illinois, this is likely to be a losing battle.