Friday, August 29, 2014
Inquirer Daily News

Do Phila libraries really add $10,000 to nearby home prices?

A Penn study makes some tall claims for the Free Library of Philadelphia system

Do Phila libraries really add $10,000 to nearby home prices?

In an attempt to show the Philadelphia Free Library and its threatened $30 million+ city-funded budget (plus $10 million+ from the state) isn't just a good Ben Franklin civic ideal persisting into the age of instant Internet information access, but is also an economically justifiable use of state and local taxpayer dollars, a new study, done for the library by Penn's Fels Institute and Institute for Urban Research, claims the 54-branch city library system provides:

- $22 million worth of yearly literacy gains
- $6 million in yearly job-finding assistance (and $30 million in higher wages)
- $4 million in "business development" by business owners who used the library

If that's true, the libraries more than pay for themselves. But do they? "It's private value, not value to the city treasury," acknowledges David Thornburgh, Fels executive director. "What's a library do for people? It's not just a place we store books.... Learning to read is critically important. Finding a job, learning about a career... it's a resource that helps you grow a business. There's benefit to me, and to us." 

To get those high values, the study says, for instance, that Philadelphians receive $99 in value every time a person who operates a business logs onto a Free Library computer, plus $10.52 for every book, movie or magazine a borrower checks out.

Fels isn't measuring the enjoyment a reader gets; it's trying to capture the economic value of these acts in terms of higher literacy and increased business skills. Just imagine the public benefit that could be claimed by Borders with its liberal visit-and-read policy, or Starbucks with its free Wi-Fi, if they measured user value that way!

Sounds like a stretch? Try this statement from the report: "Libraries are responsible for $698 million in home values in Philadelphia," and "an additional $18.5 million in property taxes to the City and School District each year," which "could be lost per year if all libraries were closed."

These remarkable figures are based on Fels' calculation that "homes within 1/4 mile of a Library are worth, on average, $9,630 more than homes more than 1/4 mile from a Library."

Penn's Kevin Gillen, who did this part of the study, tells me he took into account the fact that "most of the libraries are in business corridor districts" where prices are relatively higher than elsewhere. In fact libraries don't much boost property values in rich neighborhoods; the difference is more signficant in "working class to relatively lower-income neighborhoods," where libraries provide space for civic groups that boost the quality of life. Also, he says, it's "a correlation not a causation."

If libraries do boost property values, won't they fall when branch libraries shut down? Gillen didn't try to measure that: Given the wide swings in Philadelphia house values in recent years, he said, "it became too complicated."

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Joseph N. DiStefano
About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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