Sponsorships, Gifts Crucial For Performing Arts Venues

There’s no such thing as a cheap seat.

At least that’s the situation the Walton Arts Center and other local performing art venues face.

While ticket sales remain the largest source of revenue for the WAC in Fayetteville, the sticker price covers less than half the cost of production in some cases, said Terry Trotter, vice president of external affairs for the 14-year-old center.

“Most nonprofit arts centers do support performances that they consider to be less financially viable but important to the cultural life of the community,” she said.

Trotter said The Walton Arts Center Council’s budget aims to break even. If the center makes a little more or less, usually within 1 percent of budget, the money gets rolled into a retained earnings fund, Trotter said.

The Walton Arts Center Council employs about 50 full time staff, in addition to part-timers brought in for larger shows.

Broadway productions are the biggest ticket items for the WAC and can cost anywhere from $200,000 to $400,000 per week.

Trotter said the center can usually cover direct, non-overhead expenses with ticket sales because those shows normally sell out. However, orchestra performances and dance companies are also expensive productions, and tickets prices for those shows are very low compared to the cost to produce them, Trotter said.

“As a nonprofit arts organization, we don’t always make our decision based on bottom line,” Trotter said, “because we receive donations, sponsorships and grants we are able to do some of the performances we won’t make back on ticket sales.”

Budget

It cost about $28,000 to bring in a performance of the North Arkansas Symphony to the WAC in February. The price includes the cost to pay the musicians and the cost to rent the entire musical score for the performance. But it doesn’t include the cost for the symphony to rent the facility from the WAC.

The nonprofit rate to rent the facility is $135 per hour, and there are additional hourly staffing costs associated with the production. With the services of the ticket office, that would probably add another $6,000, said Leanne Baldwin, executive director of the North Arkansas Symphony. The Symphony functions as a separate nonprofit organization from the WAC.

Trotter said the 2006 budget for the WAC is approaching $7 million, which is more than a 1,000 percent increase from the Walton Art Center’s first year budget of $500,000 in 1992.

The center operates with a $1 million annual grant from the Walton Family Foundation and is in its second year of that five-year, $5 million grant program. It also receives more than $1 million annually in corporate sponsorships, which can range from $5,000 to $400,000 to sponsor an entire season.

This year’s season sponsor is Wal-Mart/Sam’s Club, Trotter said. It has more than 75 different corporate sponsors.

Baldwin said a North Arkansas Symphony season sponsorship costs about $50,000 for its five-concert classical series and $30,000 for its three-concert pop series.

“The challenge is working with an individual company and their goals,” Trotter said. “What can we put together that is going to work for the both of us?”

She said the unique business climate in Northwest Arkansas lends itself to more corporate sponsorships when it is compared to other major metropolitan arts centers.

“Many people and corporations would love to say ‘I love the arts, I’ll give you X amount of dollars,’ but that isn’t practical in today’s world,” Trotter said. “They have to be able to justify those dollars towards some sort of purpose.”

“I think sponsorship at WAC offers a very targeted audience that you might not be able to get through other marketing vehicles,” Trotter said.

A Giving USA Foundation survey reported arts, culture and humanities accounted for 5.6 percent, or $13.99 billion of all 2004 non-profit contributions.

Of all giving, corporations accounted for 4.8 percent of all contributions, foundations accounted for 11.6 percent, bequests were 8 percent and individual giving accounted for 75.6 percent or $187.92 billion.

Total nationwide giving in 2004 was $248.2 billion.

“Corporations aren’t as much giving away money just to give it away,” Trotter said. “Some corporations have foundations and that’s different, but a lot of our sponsorships come from corporate marketing budgets.”

The Production

Trotter said the Walton Family Foundation grant was “impetus” to give the center the financial legs to take on larger shows.

Trotter said larger shows become financially riskier because of the WAC’s seating capacity of 1,200. Most venues that take on high-profile shows have 2,000 to 3,000 seats.

“The highest fees are commanded by Broadway productions because of the cost of traveling with very large casts and crews, sets and the high production value,” Trotter said.

She said other shows that bring in high artist fees are those with well-known entertainers as headliners, such as Bill Cosby, who could command a fee as high as $200,000.

The WAC spent $2.05 million in artist fees in its fiscal year ending June 30, 2004. Its 2006 ticket-sale budget is about $2.4 million, and it will count on $1.3 million in sponsor income, Trotter said.

In addition to the $1 million Walton grant, it gets another $200,000 in various grant funds and plans on another $450,000 in patron income in 2006.

Smaller art venues compete for some of the same dollars, said Kathi Blundell, administrative director of the Arts Center of the Ozarks in Springdale.

“As far as corporate underwriting and foundations, we are asking the same people,” Blundell said. “In some respects we have different people we will count on, but in the end there are many people counting on the same group.”

The ACO is different from the WAC because it does not function as a “roadhouse” where touring groups and productions are brought in and out. All of the talent and productions are locally produced by in-house staff that account for about one-quarter to one-third of ACO’s annual budget of about $500,000.

“We mix semi-professional with community level things,” Blundell said. “So you get the best of both worlds. It’s not like community theater where anyone can come and direct.”

The ACO will start its 40th year in July.

It received $6,000 in grant funds from the Walton Family Foundation in 2004 and about $32,000 from the Wal-Mart Foundation. That same year, The Walton Family Foundation gave $10,000 to the North Arkansas Symphony, $95,700 to the Benton County School of the Arts and $10,000 to the Tulsa Opera.

“You can’t help wishing you had more money or support from any given source because there are just so many things you could be doing,” Blundell said.

Blundell said ticket sales are also their largest source of revenue, and its second largest source of funding comes from two large annual fundraisers. The theater also gets some corporate underwriting from sponsors such as Tyson Foods Inc.

The theater brought in $124,854 in program service revenue in fiscal 2004.

Blundell said the theater division of ACO tends to make enough money to help subsidize other divisions of the group, such as its gallery season and community classes.

“If we have a great turnout for the summer musical, we know we’ve made money there,” Blundell said.

However, musicals require larger up-front expenses, such as the cost of renting and licensing music, which can range from $3,000 to $4,000, depending on how long the show plays there.

She said the newer Broadway shows that have more rigorous technical needs are something they won’t be able to do.

The flying chandelier in Andrew Lloyd Webber’s “Phantom of the Opera,” for example, probably isn’t possible. And taking away certain technical elements in those shows just won’t do, she said.

“If you look at some of the musicals of the past, you can strip them bare and naked and they will still play,” Blundell said. “Nowadays if you don’t have the turntable stage you can’t do ‘Les Miserables’.”

Audience Appeal

“People look for a vibrant cultural life,” Trotter said. “To some people it means the intimate jazz performances and for some people it’s Broadway.”

Trotter said the center books shows anywhere from eight months prior to performance to up to three years for a popular symphony.

“It’s like a big jigsaw puzzle,” Trotter said. “There are a lot of demands on space and to have the date available for a touring show.”

“Technology is requiring the orchestra to be inventive,” Baldwin said.

Helen Lewis, chairman of the North Arkansas Symphony board, said orchestras are trying new things to attract a new audience and combat an aging symphony-patron population.

For example, the Los Angeles Philharmonic performed “Video Games Live” in 2005, which was a show where two players controlled the moves of the symphony in an interactive show at the Hollywood Bowl. The music included game classics such as “Donkey Kong” and “Halo.”

In February, the North Arkansas Symphony performed a new show titled “A Night at the Movies,” which featured songs from popular movies “Scarface,” “Lawrence of Arabia” and “Crouching Tiger, Hidden Dragon.” The symphony performed in tandem with movie clips playing on a big screen on stage.

Bob Emenegger, who is a retired film and documentary artist, donated the editing services and paid for the rights for the symphony to use the movie clips.

The concert was 26 seats shy of selling out, which hasn’t happened since 2000. Baldwin said they usually run at 70 percent capacity.

“It’s a fine line we have to walk with programming,” Baldwin said of appealing to its regular patrons and trying to attract new ones. “At the same time you are trying to fill seats for your organization, which requires you market to a different type of audience.”

The symphony will grow from five to 15 concerts for the 2006-2007 season, which will feature a guest conductor performance, an opener with a two- and three-piano concerto and different performance venues aside from the WAC.