Shakespeare Festival leader sees a future

Company will retool, with new model
Aug. 08, 2013 @ 07:05 PM

 Pedro Silva, long the face and voice of the North Carolina Shakespeare Festival, believes the company has a future, despite the grim recent news. He sees that future with a different business model that focuses more on education and closes the seemingly simple — but elusive —gap between funding and expenses.
The Shakespeare Festival board on July 31 announced that operations were suspended immediately, and it cited financial challenges.
“It became apparent to the board that the Shakespeare Festival was moving towards incurring additional debt that, if not stopped ... could bring about the absolute closing of the organization. ... Funding that was hoped for wasn’t materializing in a time-line that would allow us to move forward and sustain the organization,” Silva said Thursday.
The Shakespeare Festival has an outstanding loan of $192,000 with High Point Bank and Trust Company.
Since the company operates on a July 1 through June 30 fiscal year, figures for the 2012-13 year that just ended aren’t available. Tax filing figures for 2011-12 show a general direction that applies to the current situation. The Festival ended the 2010-11 fiscal year with revenue-less-expenses of $588,025, and it ended 2011-12 with a loss of $153,012.
Despite public perceptions, Silva said, arts organizations’ main revenue comes from sustained contributions, rather than earned income of the sort that comes through the box office at performances.
“I do not know of one not-for-profit arts organization in this country, and I would venture to say on this planet, that generates its main revenue through ticket sales and novelty sales,” Silva said. He cited examples from as far back as 5th-century Greece, where prominent citizens supported the great Greek playwrights.
“The model has been true throughout the ages,” he said.
For the modern-day Shakespeare Festival, sustained contributions simply were not keeping up with expenses. In July 2011, however, a major donor stepped up in an effort to remedy the situation. But those gifts also skewed any comparisons between figures before and after.
James Millis Jr. and his wife, Debbie, gave the Shakespeare Festival $720,000 in 2011-12 and approximately $650,000 in 2012-13. The money was specifically ear-marked for development and marketing, so Wil Elder was hired as president and CEO, staff was expanded from three to 15 and more money was spent promote the festival and solicit donors. Those additional expenses fell well within the boundaries of the Millis gifts, and the extra staff made significant strides in donations and visibility — but not quickly enough to keep up with the flowing out of money.
“I have heard people say this was all about an individual deciding not to support the festival, and that’s simply inaccurate information,” Silva said of Millis giving a third infusion of money. “Our general understanding was that there was a good chance that (third gift) would have happened.
“We realized that even with his support there would have been a substantial shortfall between revenue and expenses. .... It (the marketing push) was definitely worth it, but it still hasn’t been enough. Even more time is necessary for the process of development to have its impact ... ”
Silva and a skeleton staff will continue to work through September to be sure affairs are tied up, at least for the moment.
When asked if he believes the company has a future, Silva said, firmly, “I do. I always have. ... We need time to retool and reshape.”
In the next two to three weeks, he and board members will look at restructuring in a way that will bring down expenses, find sustained income streams and, simply put, pay the bills.
He is preparing a budget for the year ahead that includes a small staff, a winter-spring “Shakespeare To Go” tour and a limited number of outreach education programs. The new budget would be $1.1 million to $1.2 million, rather than the recent $1.8 million.
Silva envisions a redefined Shakespeare Festival that focuses more on educational programs throughout the state and here. Perhaps the company will contract out work on shows and end its affiliation with Actors Equity Association, which has strict requirements on salaries for professional actors and production staff. Hiring non-Equity actors and still maintaining quality will be difficult, Silva admitted.
“My gut feeling is that we might be able to get through September, with a budget through 2013,” he said. “The retooling of the Shakespeare Festival has to be addressed very quickly. To me, that means by the end of fall. It must be a realistic plan based on realistic funding opportunities.
“There is an eternal optimism that, on one hand, is the salvation of an arts organization ... and, at the same time, confuses it and gets it in trouble.”

vknopfler@hpe.com / 888-3601  

_____________________________________

Bits and pieces


“A Christmas Carol” will not be performed this fall-winter.

A hoped-for new fall-winter “Shakespeare To Go” tour, scheduled because of popularity and demand, won’t take place, but the outlook for a winter-spring tour is very hopeful.

Calendar year 2012 salaries for leaders: $90,000 for Pedro Silva, managing and artistic director; $200,000 for Wil Elder, president and CEO.

Taxpayer-generated money the Shakespeare Festival received in 2011-12 was $30,000 from Guilford County and $31,900 from the N.C. Arts Council. It received slightly less for 2012-13.

Silva, two full-time employees and one part-time employee are being paid through September. Employees who were laid off are not required to work now, and they will be paid through Aug. 16. Some of them, however, still are coming to work.