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Thursday, November 12,2009

In the dark

$210,000 in debt, BoarsHead goes dark till late January

by Eric Gallippo
Carrying a debt of $210,000 and a potential budgetary deficit of $100,000 for this fiscal year, BoarsHead Theater’s board of directors closed the theater last Friday, which is the way it will stay through December. The theater’s 13 staff members are laid off during the hiatus, and the theater’s production of “Jacob Marley’s Christmas Carol” has been canceled. The theater expects these measures to save about $77,000.

Kelly Rossman-McKinney, acting as spokeswoman for BoarsHead, said the nonprofit theater’s debt includes $62,000 owed to vendors, such as lumber suppliers and marketing outlets (including City Pulse), and a $48,000 loan from the Lansing Economic Development Corp., as well as other loans.


“They certainly were budgeted to move forward with payments, but that still would have left them in a deficit,” Rossman-McKinney said. “They are basically regrouping and getting their financial house in order so they can move forward.”


Rossman-McKinney said the theater has operated at a deficit for at least the last two years, and even with the hiatus, it could still have one June 30 at the end of FY 2010.


“One of the challenges they have had, really, is five of the last eight shows have lost money,” Rossman-McKinney said. “They are taking steps to stem that tide and regroup.”


Among the biggest losers have been the theater’s most recent production, “Beau Jest,” and the critically acclaimed “Permanent Collection.” “Beau Jest” sparked some offstage drama over the summer, when BoarsHead co-founder John Peakes and Lansing theater veteran Carmen Decker dropped out of the show as a gesture of support for Kristine Thatcher, who was let go by the board in August for financial reasons.


BoarsHead also owes at least $8,300 to the city of Lansing for back rent. In August 2008, the city bought BoarsHead’s home at 425 S. Grand Ave., Lansing, from the Arts Council of Greater Lansing as part of a long-term parking strategy. Last month, the Arts Council moved its offices to 1208 Turner St., in Lansing’s Old Town, leaving BoarsHead as the building’s sole tenant.


After an initial grace period to allow the theater to catch up on some other expenses, the city was to begin collecting $1,660 in rent from the theater starting last July. Bob Johnson, director of the city’s Planning and Neighborhood Development office, said the theater, which has yet to sign a lease with the city, owes back rent through July.


When asked about BoarsHead’s future at 425 S. Grand Ave., Johnson said he didn’t see that as an important issue for the theater right now. “They have people that aren’t being paid right now,” Johnson said. “What I’m more concerned about is the livelihood of folks who are trying to put food on the table.


“Right now, they are trying to decide whether they can remain a viable entity. We will work with them. Right now it’s about whether this arts organization will remain a part of the community. We hope that they will.”


Larry Meyer, chairman of BoarsHead’s board of trustees, who in the past has been fairly forthcoming about the theater’s financial issues, said he will not take interviews at this time.


The theater’s executive director, John Dale Smith, also declined to be interviewed. “I can’t spend any time talking with the media right now,” Smith said. “I’ve got to close down this theater for hopefully four to six weeks only.”


Operations at the theater are expected to resume in January, when corporate sponsors make their 2010 contributions, and the theater plans to stage its next scheduled show, “The Nerd,” which opens Jan. 28.


Rossman-McKinney said ticket holders for the canceled show would most likely receive complimentary tickets to an upcoming show. A possible summer show is also being discussed, for which those with “Christmas Carol” tickets would not have to pay.


For now, Rossman-McKinney said Smith, who is continuing to work as a volunteer, and the board are busy reaching out to potential donors and other members of the community. “John Dale and several board members are leading the charge on regrouping to make sure that, moving forward, they are not doing business the way they have done in the past,” she said.


Although no definite plans have been discussed, Rossman-McKinney said theater leaders from the community have reached out to BoarsHead to offer their help. One such leader is Tom Ferris, president of Lansing’s RiverWalk Theatre, who confirmed that he had contacted Smith. “We believe keeping a strong, active BoarsHead Theater is of interest to everybody in town,” Ferris said. “We’re lucky in Lansing to have a wide variety of theater choices, and any opportunity to exhibit the talent and resources of the community to audiences will help us all. If people are thinking theater, it’s going to raise all of our boats.”


BoarsHead’s budget for fiscal year 2008 was $834,000. Significant reductions, including Thatcher’s release last August, have been made to bring this year’s budget to $681,000. The theater’s biggest expenses come from productions, which cost about $312,000 annually, and staff, at about $216,000. BoarsHead productions typically cost between $30,000 and $40,000 to stage.


In February 2007 BoarsHead had to make staff cuts, because of a budget shortfall caused by the passing of major donor Shirley Pasant. Later that year, the city gave BoarsHead $25,000 to pay its back rent to the Arts Council.


Marlene Shelton, BoarsHead’s former managing director, said no one factor or party should be blamed for the company’s troubles. Shelton, who spent three years at the theater before leaving for a different job in 2008, called the theater’s financial woes a “perfect storm” during a phone interview from her home in Washington. “It’s a combination of no equity, losing a major donor, losing state funding … and then, I think just also artistic choices that, while well intentioned, weren’t exactly right to get the most bang for the buck in the marketplace there.”


Shelton emphasized that a constant source of financial trouble while she was there was the theater’s lack of equity. “It owned the props and its costumes and assorted shop materials; it didn’t own a building, it didn’t have any real negotiable equity,” Shelton said. “That always was a source of the problem, because you didn’t have means of having collateral to borrow money with. Without trying to point fingers, from a business standpoint, the question is how could you have a theater for so many years that you never established equity with?”


Another hardship Shelton said the theater faces is the lack of a major donor. “You can’t price your tickets high enough to pay all your bills from the box office. You’re always going to have to have other sources of funding. The big regional theaters that thrive, you see where their money is coming from, you look to some big CEO. If BoarsHead had that kind of person providing funding each year, there wouldn’t have been any problems.


“I had a wish for Lansing. I wished someone who had the kind of funds this theater needs would step forward and help it out, because it deserves it; it really does.”


As word of the closure and the theater’s financial woes spread, some have pointed fingers at the board for mismanaging the theater's funds. It’s a point Shelton contended strongly. “If people knew exactly what had to go on in that board, you would ask yourself, ‘Why would anybody continue to serve on that board and continue to give their time and effort to find solutions?’ because they did time and time again. There were times when individuals came forward and helped cover expenses. It’s a group of people who cared passionately about that theater. To think they mismanaged things is so far form the truth.”

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