A new five-year co-management agreement between the Port Theatre Society and the City of Nanaimo will put the burden of the theatre’s increasing maintenance costs on the city, while the society can focus on streamlining programs and selling more tickets.
The agreement, approved unanimously by council Monday, will see operations savings for the theatre of about $26,000. Energy efficiencies will save about $11,000, with the balance coming from city-incurred building maintenance responsibilities.
The previous agreement expired at the end of November.
There will also be a $15,000 increase in the society’s management fee, which will allow it to maintain its service level.
“It’s an economy of scales,” said Bruce Halliday, general manager of the Port Theatre Society. “With HVAC contracts, the city already has those contracts so it won’t cost the city as much as it does for us. Same with snow removal. They already to it so we don’t have to worry about it.
“Everything is evolutionary. This certainly is the perfect timing for it for both sides to ensure both the facility is operational long-term and that the society is in a position to continue managing.”
In 2011, the society filed an operating deficit of $114,000 largely due to to reduced ticket sales and theatre rentals. As a result, the theatre will reduce the number of events it will promote to decrease operating expenses and take the pressure off ticket sales.
About 91,000 patrons attended 225 events in 2011, resulting in $1.59 million in ticket sales.
In January, council allowed a $74,500 transfer from the theatre’s capital reserves to help offset the deficit. The Society also asked for $90,000 in operating funding relief, and much of that will come from improved infrastructure efficiencies that will lead to savings.
“The city already has facility managers,” said Halliday. “We aren’t facility managers. We’re a not-for-profit arts organization, so our focus is on presenting artistic performances.”
Under the new contract, the city also expects to reduce its capital contribution to the theatre from $100,000 to $75,000 starting in 2013, and reallocate the $25,000 to the Parks, Recreation and Culture Commission capital budget earmarked for the Port Theatre building budget to help with maintenance of the building’s infrastructure.
“Initially there might be a bit more of a cost,” said Coun. Diana Johnstone, chairwoman of the Parks, Recreation and Culture Commission. “It’s an aging building, utilities like hydro have doubled and costs are going up. (The society) will do its part by decreasing the number of programs for the time being and so far it seems to be working.”
The 2011 management fee the city provided the Port Theatre Society was $450,000. The 2012 management fee, once a two per cent annual increase approved by council and the additional $15,000 is added, is $474,000, not including the $100,000 capital contribution.
Halliday said he is confident that with the new framework, the society can move forward to provide quality arts and entertainment for Nanaimo, adding ticket sales are already recovering and programming is adapting to improve the overall product.
“Last year was the first time we had any significant balance in the red,” said Halliday. “Every business has a bad year. We had one and we don’t plan on having another one.”