By Pepper Parr
December 2, 2015
BURLINGTON, ON
Part of the budget process Burlington uses is the presenting of business cases for new spending.
The Burlington Performing Arts Centre, which is working at branding itself as The Centre, has two cases that is will take to Council.
Former site of the Burlington police station The Centre is working it way towards a business model that keeps the taxpayer subsidy as low as possible
The Centre is one of six boards and agencies that are not run out of city hall but receive significant funding from the city. Included in that list are the library, the Art Gallery of Burlington, the Museums of Burlington, Tourism Burlington and the Economic Development Corporation.
The total cost to the city for what are called Local Board and other agencies was $13,471,026 in 2015
To fully appreciate the cost of a service one has to look at the capital costs, any business cases put forward and the profit and loss situation for a board or agency.
The Centre has a strong revenue stream that consists of tickets sales, space rentals and sponsorships.
The Centre has been operational for four years – it had its problems during the first few years and found that it needed a change at the Executive Director level.
Once that change was made the flow of red ink was lessened and more seats were filled on a regular basis. Significantly more community based events were added to the program.
In 2013 city Council approved funding of $131,700 for two year contract positions as well as $225,250 for a “revenue shortfall”
City council did this under the assumption that after two additional seasons the city would have a clearer understanding of the true costs of operating the centre. Quite why this financial analysis was not done when The Centre was proposed as a benefit to the city is far from clear.
It was former Mayor Rob MacIsaac who put all the moving parts together and got the dream the city had had for many years to build a performing arts centre. The community certainly got behind when it came to raising funds to build. The centre came in on time and on budget.
Suzanne Haines recently appointed Executive Director of the Burlington Performing Arts Centre.
What many, probably most of the city councillors, didn’t understand was that performing arts centres need consistent ongoing financial support. There was one city Councillor who actually thought The Centre would contribute to the city’s tax coffers. The Centre did manage to spread the one time “revenue shortfall” funding over a three seasons.
They report that past funding for the two positions is now exhausted
The two positions The Centre wants to fill are business cases that have been put forward and if approved they will bring the 2016 base budget contribution from the city to $763,861 plus an on-going program change of $188,300 for a total 2016 contribution of $952,161 – which is pretty close to $1 million each year.
City council gulped when the cost rose to $1.2 million a number of years ago. The community was led to believe that the city contribution was going to be in the $500,000 range and seemed to be comfortable with that.
The business cases are for a Venue Technician and Community Engagement. Lighting and sound equipment is complex and the technology keeps changing. In 2016 The Centre wants to add LED theatrical lighting fixtures and portable audio equipment. Canada 150 funding ( a federal government initiative that put funds into municipalities across the country) has been identified for this project.
One of the early complaints people had with The Centre was that there wasn’t enough time for community groups and that the cost for many was prohibitive.
Former Executive Director Brian McCurdy did a fabulous job of bringing in small groups and expanding the educational program. It is not unusual to see four or five school buses parked outside The Centre.
Those students are the theatre goers of the future – these programs are a large part of what performing arts centres are built to achieve.
The Centre created an annual membership program that had modest goals in its first year – the plan is to ramp this up.
Everyone is looking for sponsorship – the wonder is that there is any water left in that well.
The budget for 2016 is set at $3,470,871.
Based on the numbers available at this point – it is not clear if this budget has been approved by the Theatre board – the city is being asked to provide 27% of the cost of running The Centre.
Salaries wages and benefits make up 48% of the budget.
Calendar of performances at the Burlington Performing Arts Centre during August of 2015
Last years The Centre was close to closed during the month of August – there wasn’t much being offered.
The activity for December isn’t much better.
Calendar of event at the Burlington Performing Arts Centre during December of 2015
The Centre recently produced an Economic Impact report done by Natural Capital Resources that reported The Centre had $7.8 million to the local economy – that figure included the salaries and wages paid out.
“This impact” said the report “has grown steadily since 2011 as the number of events and associated attendance at The Centre has grown. The study further shows that The Centre has retained cultural expenditures and related economic impact, as Burlington residents stay here to consume their cultural product more often. This repatriation of the cultural spending in Burlington translates to roughly $1.3 million of economic activity annually.
“Patron expenditures flow through the local economy in the form of sales in local businesses, restaurants and stores and impact both prosperity of business and create jobs”, said Executive Director Suzanne Haines. “The Centre’s operations and the expenditures of its patrons are estimated to account for roughly one hundred full-time equivalents each year, sixty-six percent of these jobs are in the community”.
Pie chart indicates where the economic impact was felt.
“Over fifteen thousand patrons were surveyed and approximately two thousand responses were completed, representing an outstanding thirteen percent return rate, which makes the study statistically significant. The survey found that fifty percent of The Centre’s patrons indicated they combine food as part of their performing arts experience and twenty-three percent of patrons shop as part of their performing arts experience.
This is probably not a statement the local restaurants would agree with.
The amount of money spent has climbed – has it climbed enough – what is the ideal economic benefit supposed to be?
“Ninety percent of The Centre’s patrons rate overall performance quality as ‘excellent’ or ‘very good’ and seventy-five percent indicated performances to be ‘excellent’ or ‘very good’ value for the ticket price.”
During Culture week in September The Centre put on several Friday night Jazz events that were held out on the plaza – they were hugely successful – and they were free. The public got great value. The event is expected to be repeated in 2016.
The Centre is will announce its fifth season next May. It is at that time the public will have some sense as to what newly appointed Executive Director Susan Haines brings to the table.
Unfortunately a majority of these performing arts centres in smaller communities can’t make it as independent businesses. If someone can name one that does operate without tax dollars, I’d love to hear about (Oakville? Brampton? Hamilton – a much larger city) If you can find a successful model, replicate it.
Regarding getting huge value from the free jazz concerts in August, the value would have been greater if the event was held at many other venues that the City owns and doesn’t subsidize to the tune of $1M / year.
A true evaluation of the value of the PAC would be:
1. dollars spent in the venue per seat sold
– how much money does each person spend? Is it coming up? going down?
– not hypothetical meals sold in local restaurant
– include ticket price, drinks, food sold etc
2. number of seats sold in a year
– is user base growing?
3. percent occupancy (like hotels use)
– how frequently is the venue booked and how are people going to see the events
I’m sure smarter minds than mine can add some other measures. I’m absolutely positive that Council and Ms. Haines have these measures of success. They are just waiting to announce them at them appropriate time.
Bon chance. It would be good to have the PAC succeed.
It was quite evident to many residents that the Performing Art Centre would be a financial drain for as long as it operates. I question the claim that they add $7.8 million to the local economy. If that were indeed true why are restaurants continuing to close – Siam Dish is the latest one to leave Lakeshore, and it has been mentioned that others will probably be closing in the New Year. I would like salaries to be removed from this total as well.
Personally I would much prefer my taxpayer dollars to be used on badly needed infrastructure projects.
Ah, Mr. MacIsaac. Wasn’t he the Mayor who promoted the Pier as well as the Performing Arts Centre? Coincidence?