FOR IMMEDIATE RELEASE
NORTHAMPTON, Mass. – A year after the Academy of Music Theatre announced the need to reevaluate its business plan, the historic performing arts venue is operating under a new model that promises to make its longstanding financial struggles a thing of the past.
The turnaround began with the January 2007 announcement by the Academy’s Board of Trustees that diminishing nightly movie attendance, mounting debt and lower-then-expected donations had forced the board to end nightly movies as well as lay off its staff.
“Although the decision was extremely difficult, it was undeniably the right decision,” said Andrew Crystal, president of the board of trustees for the 117-year-old theatre. “The trustees did not want the Academy’s history of debt troubles to become its legacy.”
In the months following the announcement, the board of trustees solicited community feedback about the city-owned venue. Based on those discussions, the board adopted a two-year vision statement that did away with much of the financial risk inherent to the previous business model, according to Crystal.
Instead of assuming the risk of presenting shows, for example, the Academy of Music shifted to rentals. And, instead of leaving the critical task of fundraising with the volunteer members of the board of trustees, that task was shifted to professional fundraisers.
Under the new business model, Crystal noted, the theatre saw an increase in the number of rentals for concerts, films and live performances; an increase in fundraising; and a reduction in operational costs for the 800-seat venue.
At the same time, the board of trustees whittled its accounts payable and short-term debt from the $103,000 owed to local banks, vendors and film distribution companies, to less than $29,000, an amount owed entirely to film distribution companies. All local businesses have either been paid or generously forgave the debt, and vendors are now being paid on time. The short-term bank debt was replaced by a longer-term $50,000 loan from the WGBY, the public television affiliate with which the Academy formed a strategic alliance early this year.
“The Academy of Music is truly an investment in the local community,” said Crystal. “But, as an investment, it needs continued and sustained support from the community to ensure that future generations will be able to reap its rewards.”