Determining the Halo Effect of Historic Congregations

In 2010, Partners for Sacred Places and the University of Pennsylvania School of Social Policy and Practice concluded a pilot study of the economic impact of houses of worship. We found that 12 Philadelphia congregations contribute $52 million in annual economic value to the city of Philadelphia, for an average of $4.3 million per congregation. By assessing over 50 different factors, we have pioneered a new quantitative approach to understanding how congregations impact local economies. Congregations must now be understood as critical economic catalysts, suggesting an important shift in community investment policy and practice.

We can categorize the dozens of ways congregations benefit their communities in three broad areas: 1) through direct spending; 2) the value of day care and K-12 educational programs; and 3) a range of catalyzing or leveraging economic values, such as Open Space, Magnet Effect, Individual Impact, Community Development and Invisible Safety Net [see Graph 1].

Types of Local Businesses Supported by Congregational Spending and Activities [Table 1]

Architect Firms
Building Maintenance
Building Suppliers
Construction Firms
Corner Stores
Custodial Services
Music Support
Office Supply Stores

Since its founding in 1989, Partners has focused on understanding how congregations use their assets—including their buildings—to serve the wider public. Co-founders Bob Jaeger and Diane Cohen knew that congregations hosted a wide variety programs, ranging from soup kitchens to day care centers to job training.

The study, published by Jaeger and Cohen as Sacred Places at Risk [SPAR], found that urban congregations provide over $140,000 [in 1997 dollars] in resources to support community-serving programs each year.

In addition, the project confirmed that 4 out of 5 of those benefiting from church or synagogue-hosted outreach are not members of those congregations; in effect, sacred places serve as de facto neighborhood community centers.

Although groundbreaking, SPAR did not attempt to look at all of the ways that congregations impact their communities. While the tools that SPAR made possible were effective, they were limited. They measured the value of space and volunteer time of some social programs, but couldn’t account for the vast and more complex impacts of lives improved. In 2007 Partners convened a small group of researchers from academia and the non-profit sector to propose the concept of a larger valuation study, and included in that proposal several factors outlined by Associate Director, Tuomi Forrest. The proposal sought to factor in the value of green space, trees, building projects, tourism, and visitors to congregations, as well as the impact on public safety and housing values, support for local business and vendors, budget and taxes, affiliated Community Development Corporations and a congregation’s role as an incubator for new businesses or non-profits.

After securing a grant from William Penn Foundation in 2010 to pilot this new study, Partners joined with Dr. Ram Cnaan of the University of Pennsylvania’s School of Social Policy and Practice, and began to lay out a new, ambitious, quantitative approach to understanding the full value congregations provide to their local economy – an approach that could be used by government, policy analysts, and advocates.

According to our calculations, the overall estimated annual value of the 12 studied congregations is $51,850,178 [see Table 1] This estimate translates into an average value of $4,320,848 per studied congregation.

Participating Congregations [Table 2]

First Baptist Church of Paschall
Arch St. United Methodist Church
Jones Tabernacle African Methodist Episcopal Church
Shiloh Baptist Church
Visitation of the Blessed Virgin Mary
Mother Bethel African Methodist Episcopal Church
Gloria Dei (Old Swedes’) Church
Calvary United Methodist Church
The Church of St. Luke and the Epiphany
Congregation Rodeph Shalom
St. Mary’s Church, Hamilton Village
Summit Presbyterian Church

This value is over 30 times higher than that established in SPAR. Clearly congregations are important employers; purchasers of local goods and services; magnets for bringing in cash, volunteer time and other resources from outside the city; educators of pro-social values; and providers of important value through the ‘invisible safety net’ of programs, counseling, and other services that help individuals and families be productive workers and citizens.

For policy makers, community and business leaders, and funders interested in a particular facet of economic life, this data should help guide their investment. For those interested in tourism, understanding how congregations attract travelers regionally and nationally is critical. For those wanting to strengthen commercial corridors, understanding the flow of people from a congregation and how they support local business, or how congregations incubate small ventures is critical. Even in an area where the overall value is relatively low, like open space, we found two congregations with significant green space and trees. In effect they manage mid-size urban parks that contribute the the economic and environmental well-being of the city and region.

Partners for Sacred Places will continue to work with the University of Pennsylvania School of Social Policy and Practice and other academic/research advisers. We will now refine the valuation methodologies where need be, slightly expand the scope of factors studied, and most importantly conduct a wider study, randomly selecting congregations from multiple cities or states to get a national picture of the Halo Effect of sacred places.

Links to media stories about the event

February 2,2011, Philadelphia Inquirer: A study asks: What’s a church’s economic worth?
May 20,2011, BBC News: The unpaid volunteers saving millions for the state

Read the full report on Partners’ Halo Effect study.
Click image to download a PDF.

Cover Halo Effect White Paper 1-9-13