Madison and Miami Suffer Winter Arts Blues

...the new performing arts center here, one term became something of a mantra among the project’s boosters: world-class...

...Center for the Performing Arts, is in administrative upheaval and struggling financially... the project was built too big and too soon, and without enough certainty that the city could even support such an ambitious venture. They say the center is yet another case of...overreaching...

“Miami is a land of speculation,” said Mary Luft, founder and executive director of Tigertail Productions, a performing arts production company. “They want it big, they want it fast, they want it now. And they got it!”

...a prominent civic activist, calls the center,... “a total misappropriation of money,” given the pressing social demands of the city, which has one of the highest poverty rates of any major city in the country.

“It’s a building inappropriate to the scale and need of the place,” said Mr. Farago...

The center was designed by Cesar Pelli and... But when the center opened ...it was already in something of a public relations and financial hole.

It opened...about $100 million over its budget at groundbreaking in 2001.

Some artists and cultural groups complained that money for the center could have been channeled into existing organizations and performing arts companies in desperate need.

The quotes above are from the New York Times.The link to the entire story which appeared December 27, 2007 is below.

We all know the consequences of certain Madison leaders failing to understand the economics of operating the Overture Center.

 Shows are booked into Overture on a regular basis. Most shows are well attended. That tells us that the facility was overbuilt.

 Layoffs will take effect January 16, 2009. Those affected are being notified today. Most of the staff affected will have the right to move into other City of Madison jobs.

 

There are simply not enough dollars in the pockets of south central Wisconsin residents to pay to keep the facility operating. There are not enough open dates or open seats to make up the operating deficit.

Raising ticket prices will only drive away more customers who are already finding it difficult to pay ticket prices and the accompanying fees and surcharges.

Meantime in Florida we learn:

Fits, Starts and Painful Bumps for Carnival Center in Miami

Comments

[Marius]

Nothing that's happening there is a surprise. Several people, going back to 2004 (before the grand opening), had been warning of what was coming - that overhead was disproportionate to earnings, and would continue to grow inexorably, while income potential, at its most optimistic, could never cover an increasing shortfall. But a kind of lethargy seems to have pervaded the whole enterprise. Now, and even back then, it is unclear whether the problems are even solvable. (Clearly, inspiring new leadership has not helped.)

Regarding the proposed solutions of the concerned citizens group:

1. Re-structuring the governance would take an act of the state legislature.
2. Laying off people means bumping jobs al over City government.
3. Tax money from Dane County village and townships - don't hold your breath.
4. Book shows that sell more tickets - duh...

One great irony, of course, is that with Overture's $12m annual budget, even if the original bonding and arbitrage plan had succeeded, it would only have generated a $1.4m / 11%, drop in the annual operating budget bucket. Hence it was never really going to solve the underlying problem, which is that Mr. Frautschi gave the city a gift that it just could not afford.

[Peter Gruett]

This is a bit of a surprising rant coming from you, Paul. Arts centers don't ever pay for themselves with ticket sales. The individual shows don't even pay for themselves with ticket sales. Like the Civic Center, Overture was always going to be dependent on a nominal public subsidy (like Monona Terrace) and private donations. Frautschi's intent with the endowment was to supplement these with investment revenue. It's clear, in retrospect, that goals for the endowment were colored a bit with the irrational exuberance of the time.

What annoys me is the vitriol with which people are attacking a man who gave the city a fifth of a billion dollars to build a grand arts venue to last for the ages because he failed to anticipate the near-immediate onset of the greatest financial crisis the world has seen in almost a century. The mightiest banks and industries in the country are begging at the public trough for hundreds of billions of dollars in bailouts, but apparently that pales in comparison to the fact that, maybe, after the stop-gaps expire in a couple years , the city/county might have to chip in to service Overture's paltry remaining debt and a greater proportion of its operating expenses.

Perhaps we could count our blessings that, for almost nothing, we got a massive boost to the cultural and educational infrastructure that's going to make this a really great place to live in the coming decades, beyond the current crisis. The least we could do is stop whining and go see a show.

[Marius]

Mr.Frautschi's gift was magnificent and generous beyond reckoning.

My statement that "Mr. Frautschi gave the city a gift that it just could not afford" was made in sorrow, not ingratitude.

[A.J. Love]

Many (most?) of the performance rooms in the Overture Center sit empty most days. They are clearly overpriced for rentals. Those rooms generating SOME income would logically be better than sitting empty. Many of those rooms could be a vital part of what could be more of a thriving downtown music scene. Coulda woulda definitely shoulda. Maybe that can change.

Then there is the atrocious/borderline silly (in my opinion) programming. When was the last time Wayne Shorter or Branford Marsalis or BB King or Ari Brown or Ethnic Heritage Ensemble or Robert Cray or Joe Lovano etc etc etc played the Overture Center? That would be never. Maybe that can change too

The real blunder came when the City of Madison decided to invest in the stock market in order to help fund the Overture Center.