In many respects, the cultural circumstances that would dominate Liverpool's artistic community in the early decades of the twentieth century were already in place by the time of Reilly's arrival in Liverpool in 1904. A number of institutions, such as the Liverpool Academy, had sprung into life at sporadic intervals for over 100 years. Newer institutions, such as the Walker Art Gallery, were the civic face of artistic ambition. The Walker, however, proved rather inadequate under its chairman John Lea, who is described by his biographer as ‘slow to push out into new depths… he had certain spiritual and intellectual limitations.’ The decision to separate the Applied Art Section from the School of Architecture had been made by the university before Reilly's appointment; it would lead to the formation of the Sandon Studios Society, a breakaway art school in competition with the Corporation's School of Design. The Sandon Group gave the artistic community fresh impetus to to develop alternatives to such ‘official’ bodies as the Walker. Examples of such alternatives are exhibitions such as the New English Art Club show organized by Gerald Chowne at the Royal Institution building in 1905, the Sandon Society's spring exhibition of 1908, and the two Post-Impressionist shows of 1911 and 1913. John Willett summarizes the position: ‘the irreconcilable gap was no longer between the art-lovers and the Corporation, as it had been at the time of the St George's Hall panels, but between the official bodies and the unofficial one’.

Reilly's position in this cultural web is, in many ways, ambiguous. On the one hand, he was associated – via his university appointment – with the artistic establishment. Shortly after taking up the Roscoe Chair he was appointed a governor of the Corporation Art School; yet he used the appointment to encourage Gerald Chowne – a member of the New English Art Club who would later play a leading role in the Sandon Society – to come to Liverpool. Reilly's association with the leading families in the city – people such as the Rathbones and the Holts, who had connections with official cultural groups – was combined with close affiliations with Gerald Chowne, Augustus John and Herbert MacNair, who chose to remain outside the cultural establishment. Reilly, therefore, seems to have attempted (with varying degrees of success) to keep a foothold in both camps.