SEVENTH MEETING OF THE YEAR 2005 -

MARKHAM THEATRE BOARD

TOWN OF MARKHAM

 

Canada Room, Markham Civic Centre

Monday, August 22nd, 2005

 

MINUTES

 

ATTENDANCE:

 

Members

 

Brian Harvey, Chair

Evelyn Bailey

David Banfield

Alex Chiu

Neil Fernandez

Jim Jones

Pat Kincaid

Genny Landis

Michael Landry

George McKelvey

Elaine Rubin

Joyce Scobie

Gary Unitas

 

Regrets

 

Leslie Johnstone

Mario Miranda

Barb Roth

Frank Scarpitti

Jim Sales

 

Staff

 

David Scott, Theatre Manager

Debbie Watson, Theatre Secretary

 

 

The meeting convened at the hour of 5:30 p.m. with Brian Harvey in the Chair.

 

1.0     REMARKS FROM THE CHAIR

 

          Brian Harvey welcomed everyone to the meeting, noting that it was the first one since the very successful barbecue.

 

1.1     APPROVAL OF THE MINUTES OF THE MARKHAM THEATRE FOR PER- FORMING ARTS BOARD MEETING HELD ON JUNE 27TH, 2005.

 

          RECOMMENDED:  THAT THE MINUTES OF THE MARKHAM THEATRE FOR PERFORMING ARTS BOARD MEETING HELD ON JUNE 27TH, 2005, BE APPROVED AS CIRCULATED.

 

1.2     SEPTEMBER Events

 

          David Scott reported that Markham Youth Theatre is returning for a week, however, they still have some internal financial issues to resolve.  Markham Little Theatre, also booked for a week, has raised some concerns with the processing of their tickets.  Their attendance numbers have been steadily decreasing.  There are a couple of corporate uses at the end of the month.

 

2.0     FINANCIAL REPORT

 

2.1     Finance Committee - Mario Miranda, Chair, Michael Landry, Pat Kincaid, Joyce Scobie

 

(a)      July Month End

 

          Michael Landry advised that the Finance Committee continues to be concerned about next year’s financial position.  Revenues have decreased slightly from the end of May, while expenses are up slightly.  Ticket sale revenues, however, are up considerably over last year.  Even though rental revenues show a small gain at the end of July, all other factors are down, including attendance with a decrease of 19%, and rental days used down by 13% over the same period last year. To date, little informa- tion has been received from the Finance Department with regard to revenues/expenses from the revenue streams, which had been requested by the Board.

 

          He went on to say that the 2006 budget is due at the end of September.  The Town has proposed a deficit of $160,000.  Finance Committee feels this is too aggressive, for a number of reasons.  There are presently no grant monies available.  Sponsorship revenues have dropped sharply.  Even though salaries have increased by 3.5%, revenues are set to only increase by 1.3%.  David Scott has been asked to find shows for the fall of 2006 that will increase attendance while decreasing expenditures.  The Finance Committee has re-examined the budget target and feel that a deficit of $200,000 is a more reasonable estimate.

 

          Genny Landis suggested that the three revenue streams, professional entertainment, commercial, and education uses, be examined to determine where money is being either lost or generated.

 

          David Scott pointed out that it would mean a change in how bookings are handled.  Even if a new system were to be implemented, it would take a couple of years to see any results one way or the other.

 

          In reply to a question by Elaine Rubin, David Scott said that the loss of grant money is a difference of $25,000.  The biggest difference, however, is the salary increase if 3.5% with a revenue increase of only 1.3%, resulting in an overall shortfall of 2.2%.

 

          Michael Landry pointed out that these two items alone add up to about $50,000 variance year over year.

 

          George McKelvey said that the professional entertainment shows are basically priced to earn a profit, whereas the community and education rentals provide a service to the community.  At what point do the schools discontinue using the theatre because of the cost?

 

          David Scott responded by saying that the ideal situation is to make money on the professional shows but the profit varies in each case.  There is also the question of what the market will bear with regard to ticket prices.  There has already been an additional $1 handling charge added per pair of tickets.  A further increase of $10 per pair might create a mental barrier re cost, resulting in difficulty selling tickets.  The current pricing is very competitive for Professional Entertainment Season tickets.

 

          Genny Landis felt that some of the professional entertainment shows could withstand a ticket price increase without difficulty.

 

          Michael Landry pointed out that this would not be known until tickets actually go on sale.

 

          Elaine Rubin questioned whether the town seems to be upset with the current deficit.

 

          David Scott replied that the town appears prepared to invest in and support the theatre as being a worthwhile part of the community.

 

          George McKelvey added that there will continue to be good support if it is felt that the theatre is being operated properly.  They do see it as having a positive impact on the community.

 

          Brian Harvey pointed out that the issue seems to be the importance of an operating budget showing a deficit of $160,000, when it is known that it will more likely be $200,000.

 

          David Banfield reiterated the fact that the town was going to provide some historical data, which has not been received and is still wanted by the board.  In fact, information has stopped coming from the Finance Department.

 

          David Scott advised that most of the 2006 budget setting is based on 2005 figures.  Is there a business case or factor affecting a budget line?  There has been a wage increase of 3% for the year.  There has been an increase in the cost of paper towels and hydro but the maintenance budget has remained the same for the past ten years.  Sponsorships have been dealt with a number of different ways over the past few years.  This has resulted in eroded sponsor relationships and support that doesn’t continue from year to year.  The ticket capacity numbers are good but less rental hours per performance means less overtime revenue.  A larger number of renters are not issuing tickets through the theatre box office, meaning no ticket handling charges are being paid.  This is being very difficult to determine in advance.  Such losses are being reflected in the budget.

 

          David Banfield said that the basis for the budget is historic information.  We need to go back and look at the cost centres.  Can ticket prices be raised?  Is there a line budget for 2006?

 

          David Scott advised that the town has access to the performance budgets but they are not split between the three rental streams – community, educational, and professional.  Theatre staff will have to do it.

 

          Evelyn Bailey felt that if the professional shows can be managed to make a profit, then it should be understood that the community and education uses would not.

 

          Genny Landis wondered why it would not be possible to increase rental fees by 3% if wages were increased by that amount.

 

          David Scott replied that the rental increase has been capped by Council.

 

          Michael Landry added that we don’t have the right to run the theatre on a stand alone basis.

 

          Jim Jones felt that ticket prices should be raised by 3%.  Every program should break even.

 

          In reply to a question by Neil Fernandez, David Scott said that ticket prices are raised every year.

 

          Brian Harvey pointed out that the additional revenue amounts to only $8,000.

 

          Jim Jones suggested that if we are subsidizing community uses, we have made a conscientious decision to do so.

 

          Evelyn Bailey felt that if the theatre maintenance budget has stayed the same for the past ten years, while costs have increased, then the budget should be increased as well.

 

          David Scott added that the 2006 hydro budget is the same as it was in 2005.  We don’t want the 2006 budget to be based on inaccurate pretences, i.e. the 2005 budget rather than actuals.

 

          Evelyn Bailey requested, therefore, that the 2006 budget figures be based on 2005 actuals rather than the 2005 budget.

 

          Brian Harvey expressed the opinion that if the Commission is willing to take the risk involved with using old budget figures rather than actuals, then so be it.

 

          George McKelvey pointed out that the hydro increase in done on a town-wide basis.  David Scott doesn’t set the budget; he makes recommend- dations.  The Theatre Budget Committee should recommend to the theatre manager what they think the budget should be.

 

          David Scott went on to say that the fiscal 2005 sponsorship is currently at $71,000, while the 2006 budget was set at $125,000, whereas he had recommended that $80,000 was more realistic.  It is currently being proposed at $100,000.

 

          After some further discussion, it was

 

          Moved by Evelyn Bailey

          Seconded by David Banfield

 

          THAT the 2006 budget figures be based on 2005 actuals rather than the 2005 budget.

 

Resolution carried.

 

(b)      Comparative Statistics – June and July

 

          Genny Landis questioned why the number of rental days and attendance were down.

 

          David Scott replied that July was a lot slower than in previous years, as were February, March and April.  Markham Youth Theatre didn’t do a weeks run in July as they did last year.  Actual attendance is down because there are a lot of smaller groups doing smaller events.

 

          Evelyn Bailey pointed out that the one thing we can’t control is atten- dance.

 

          Michael Landry noted that there has been a sharp reduction in both community and education uses.

 

          Evelyn Bailey responded that, even so, our attendance is better than most other theatres.

 

3.0     MANAGER’S REPORT

 

3.1     P.E.S. Sales Update

 

          David Scott reported that those tickets not yet picked up, were mailed out.  The average capacity of tickets sold for the season is at 52%, which is 2% above the target of  50%.  There is only $83,00 in sales required to reach budget for fiscal 2005.  There are already four shows in a profit position, including sponsorship revenue. Single ticket sales have to be looked at, however, before adding shows.

 

3.2     ARRANGEMENTS FOR MANAGER’S LEAVE OF ABSENCE

 

          David Scott advised that Bonnie Armstrong would become Acting Manager, Scott Hill would be Acting Facility/Production Manager, and a house technician would be hired under contract.  David Scott would continue to do programming for the 2006-2007 professional season, as well as budgets, board meetings, special projects, sponsor receptions and some show introductions. The changes are expected to be expense neutral, and give everyone a good sense of security.

 

          Brian Harvey noted that the arrangements take care of all his concerns and result in what he considers to be a win/win situation.

 

4.0     ACTION ITEMS

 

4.1     Theatre Board Draft Terms of Reference

 

          Brian Harvey advised that all the board’s previous input has been taken into account and this final proposal would go to the next Council meeting.

 

          Michael Landry noted that the word “committee” on Page 5, Proposed Composi- tion, should be changed to “board”.

 

          Evelyn Bailey added that the Structure chart also says “board”, and should also show a Nominating Committee as noted on page 10 of the document.

 

          Genny Landis felt that a Volunteer Committee should be added.

 

          David Scott explained that the volunteers are now being managed through Client Services.  The Board will be able to add further sub-committees if they choose to do so in the future.

 

          It was

 

          Moved by Evelyn Bailey

          Seconded by Elaine Rubin

 

          THAT the Markham Theatre Advisory Board Terms of Reference be approved subject to the changes noted herein.

 

Resolution carried.

 

5.0     UPCOMING TOPICS

 

6.0     COMMITTEE REPORTS

 

6.1     Sponsorship Support Committee – Genny Landis, Chair, Neil Fernandez, Pat Kincaid, Jim Jones

 

          Genny Landis reported that there are now seven new sponsors.  The committee has been waiting since May to meet with Jim Sales in order to discuss the new strategic plan.

 

          Brian Harvey suggested that a meeting be formally requested prior to the next board meeting.

 

6.2     Bruce Cockburn Fundraising Committee – Evelyn Bailey, Randy Barber, Brian Harvey, Neil Fernandez, Ross Sutherland, Elaine Rubin.

 

          David Scott advised that the committee has not met over the summer.  Wendy Woof-Severn will be sending out a sponsor letter and a direct mail information card.  Two sponsors are giving goods and/or services “in kind”.  There will need to be another meeting in early September.

 

7.0     OTHER BUSINESS

 

8.0     DATE OF NEXT MEETING

 

Monday, September 26th, 2005, 5:30 p.m.

Canada Room, Civic Centre

 

9.0     ADJOURNMENT

 

There being no further business, the meeting adjourned at 6:40 p.m.