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Civic Theatre returns funding to the city

The Rochester Civic Theatre has returned three-quarters of the funding it received from the city, which could mark a new path for city-supported performing arts in Rochester.

The Rochester Civic Theatre
The Rochester Civic Theatre. (Post Bulletin file photo)
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The Rochester Civic Theatre has returned three-quarters of the funding it received from the city, which could mark a new path for city-supported performing arts in Rochester.

Theater Board President Jeff Haynes said a check was delivered Friday afternoon, two days after the board received a letter demanding the return of $150,000.

"We were trying to protect the money," Rochester City Attorney Jason Loos said of the decision to send a letter to the Civic board.

In a Friday memo to members of the Rochester City Council’s Outside Agency Oversight Committee, City Administrator Steve Rymer highlighted four concerns regarding the Civic Theatre’s finances:

  • Past defaults on various debts, including $4,388 in payment to Rochester Public Utilities that was at least 90 days overdue at the end of 2019.
  • The theater has been placed on a "do not sell" list for liquor after allegedly failing to pay state liquor taxes.
  • Loans from board members are seen as potential conflicts of interest.
  • A $300,000 unsecured loan was obtained by the theater.

Rymer said he’s concerned about the Civic Theatre’s ability to recover due to its reliance on funding outside operational revenues.
Haynes, however, said he feels the organization is making progress.

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"We’re in the process of being caught up right now," he said, adding that the board is also looking to revise its current budget to help make ends meet.

He said much of the $250,000 in debt due to vendors at the end of the year has been paid with the help of an anonymous $200,000 donation to the theater.

While the added funds didn’t completely balance the books, he said revenue from the next three shows should improve the organization’s finances.

Rymer indicated it might not be enough.

He’s suggesting the City Council tell the theater it intends to terminate its agreement at the end of the current season, with plans to create a new city-supported performing arts model.

The oversight committee is slated to meet at 9:30 a.m. Wednesday in Room 104 of City Hall to prepare recommendations for the full council, which are expected to be considered on Feb. 19.

Regardless of the City Council’s decision, the funding path for theater payments is expected to change.

"The city will use the $150,000 to reimburse the Rochester Civic Theatre for building maintenance and utility payments," Loos said, adding that the organization would likely be required to provide a list of expenses.

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The theater board was allowed to keep $50,000 of the $200,000 city allocation as a first-quarter payment, with plans to commit $50,000 a quarter to the operation.

Haynes said the quarterly allotments will be needed.

"I want everyone to understand that to keep this facility going, we need $200,000," he said.

Before heading into a meeting with the Rochester City Council’s Outside Agency Oversight Committee on Tuesday, the theater board submitted a report detailing how city funds were spent last year, which included $72,362 on utilities, $29,000 on custodial expenses and $17,500 on insurance. The total expenses added up to $220,000 when roof repairs were included.

"My expectation is we would have similar bills," Haynes said, acknowledging that 2020 expenses may not include the $21,277 spent on the roof last year.

Rymer said if the city changes the model for operating the theater, he expects it will maintain the same level of funding for facility maintenance.

Whether the city would also need to fund added operations under a revised model is uncertain.

"We don’t have those details," he said, adding that a final recommendation would likely be made in May, if the council opts to look at changes.

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"That will ultimately be for the council to decide," Rymer said.

The Civic Theatre may not be the only entity facing changes.

Council members said Friday they anticipate other groups could also see funding changes next year.

"One of the recommendations that is likely to come from the oversight committee is that all allocations from the city to outside agencies will be done on a quarterly or monthly basis and not as a lump sum at the start of the year," Council member Michael Wojcik said.

Council member Shaun Palmer, who advocated for the return of the entire $200,000 provided to the Civic Theatre, agreed.

"I think we need to do some more looking at how things have been done," he said.

Meetings during the week of Feb. 10 include:

Rochester

  • Outside Agency Oversight Committee, 9:30 a.m. Wednesday in Room 104 of City Hall, 201 4th St. SE 
  • Energy Commission, 4:30 p.m. Tuesday in Room 104 of City Hall
  • Planning & Zoning Commission, 6 p.m. Wednesday in the council chambers of the city-county Government Center, 151 4th St. SE
  • Pedestrian and Bicycle Advisory Committee, 7 p.m. Wednesday in Room 104 of City Hall

Olmsted County

  • Commissioners’ retreat, 9 a.m. Tuesday at Quarry Hill Nature Center, 701 Silver Creek Road NE
  • Community Services Advisory Board, 7 a.m. Wednesday in Room 161 at  2117 Campus Drive SE
  • CREST Regional Management Team, 1 p.m. Wednesday in Room 161 at  2117 Campus Drive SE
  • Zumbro One Watershed One Plan Policy Committee, 9 a.m. Thursday at People's Energy Cooperative, 1775 S. Lake Shady Ave., Oronoco

Rochester Public Schools

  • School Board study session, 5 p.m. Monday at the district’s Facilities Services Center, 3935 Highway 14 E.
  • School Board retreat, 5 p.m. Monday in Room 26 of the Edison Building, 615 7th St. SW

Last week, the Rochester Civic Theatre provided city officials with a list of its outstanding debts at the end of 2019. The debt to businesses and individuals totaled $250,819.

Of the debts, at least 17 businesses had sent invoices of $1,000 or more that had gone unpaid for at least 90 days. They are:

  • Accounting Plus: $3,412
  • Arnold’s Supply: $1,116
  • Capital One Commercial Menards: $1,233
  • Double Tree Hotel: $29,863
  • Fairway Outdoor Funding: $3,000
  • Higher Standards: $1,246
  • Hilton Garden Inn: $16,373
  • Johnson Printing: $1,605
  • Kutzky First: $4,393
  • Minnesota UI: $16,482
  • Music Theatre International: $29,233
  • Post Bulletin Company: $1,551
  • Rochester Magazine: $2,062
  • Rochester Public Utilities: $4,388
  • Smith, Schaefer and Associates: $8,000
  • Ticket Force: $4,109
  • Townsquare Media: $2,516

Rochester Civic Theatre Board President Jeff Haynes said many of the unpaid bills have been covered since the report was generated.

Related Topics: FINANCE
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