Special Bd. of Aldermen — 5/2/17 Page 7
non-local government. We've also added a significant chunk of support from an endowment. We are
estimating an endowment of $4 million that is generating about four percent to sustain operations. That
endowment we’re proposing is the private sector role in the financial success of the building. We're looking to
the public sector to provide bonding support for capital and looking to the private sector to raise money from
the outset to endow operations. Endowment is really the most certain way to have a successful building
because it is there. It’s money that is protected and can sustain this building a long time out in the future.
The last big piece of analysis was we projected the economic impact of this building on the county economy.
We buy these multipliers from the Bureau of Economic Analysis in Washington. Those multipliers allow us to
say when a dollar is spent in Hillsborough County in a certain industry; it gets re-spent and re-spent and re-
spent and ultimately has a larger impact depending on the industry. That allows us to project direct, indirect
and induced impacts of both building the building and operating the building.
Construction impacts of $12 million generates in Hillsborough County about $20 million in new sales. For
example, a certain amount of money is spent on lumber in a Hillsborough County lumberyard. That
lumberyard operator in turn spends that money on computers and stationery and so on. That money then gets
re-spent. That’s the idea of the multiplier effect. That leads to new sales of $20 million, earnings at $6 million
and 112 person-years of employment in the county as a result of this project.
Then we have the impacts of operation. Every line item in the operating budget, excluding staff, we have
applied the multiplier to. There’s a certain amount of money spent on utilities, on waste removal, on
administrative services, and building services. We apply the multipliers in order to show how $900,000 spent
not on personnel leads to significant impacts beyond that.
The third type of impact, which is often the most important on these projects, is the impacts of audiences.
People coming to performances. We know from American for the Arts, we know how much they spend on
retail and eating and transportation and staying over. We are able to calculate then those expenditures and
the total impacts relating to them. The economists in the room will say you have to be very careful about
economic impacts because we can’t count money that would already be spending in Hillsborough County.
They are just bringing it to another part of the region. The only money we can really count here is the audience
coming from outside the county and the audience that would otherwise gone outside the county. Those two
components, which we estimate at about 50 percent of the total audience, allows us to project the impacts of
audience. If you combine those annual operating impacts with the impacts of audiences, in every year the
operation this building drives $1.4 million in new sales, $300,000 in new earnings in the county and it creates 9
new jobs in addition to the jobs in the theatre, itself. It’s jobs associated with the economic activity that the
theatre brings.
In addition to those quantitative impacts, there are some significant qualitative impacts associated with this
project. We believe this is a catalytic project for the redevelopment of downtown Nashua. The presence of
this building will drive commercial development which will lead to other gains in economic output as well as
those other issues like corporate recruitment. We believe the project will attract companies, workers and
residents to downtown Nashua, and we see this as a key attraction within a district for tourism development in
Nashua.
Finally, we have estimated how you move forward from here. There are three parallel tracks. One is related to
fundraising, one is related to physical planning, and one is related to planning for operations. Physical
planning, if you initiate the work of forming a building committee and thinking about getting more specific costs,
hiring a design team, going through phases of construction, heading into construction in the earlier part of
2019, you’re essentially in a position to open the building in the fourth quarter of 2020. That is a not-rushed but
fairly steady pace. The purple squares is a reminder that you can’t wait until the building is about to open to
start thinking about operating. You have to start setting policy, hiring staff, getting vendors involved. There’s a
lot of work to do to be ready. The third track is related to fundraising. There’s a couple of important elements
as Tim will outline in a minute. The first thing is to come forward with a bonding request to fund the capital
