Recession shares stage at arts nonprofits
Just before Broadway Grand Rapids enjoyed its biggest hit in two seasons with last week’s performances of “Rain: A Tribute to the Beatles,” staffers were salvaging old paper clips and folders as they cleaned out a storeroom.
“We pulled everything, every single paper clip, every single binder clip, every single folder that we could reuse, and we restocked,” Executive Director Eric Messing said. “All that little stuff adds up to a greater whole.”
As the economy lurches through a recession, half of the Michigan nonprofits surveyed last fall reported that financial and in-kind support had decreased over 2008, and the majority expected declines in 2009, according to a study from Grand Valley State University’s Dorothy A. Johnson Center for Philanthropy and Nonprofit Leadership and the Michigan Nonprofit Association. In West Michigan, the survey showed, 48 percent of nonprofits anticipate a decline in support in 2009.
“It really comes down to the power of positive relationships,” Messing added.
Arts organizations are a component of economic development by creating the kinds of communities in which people want to live, said Kyle Caldwell, president & CEO of the Michigan Nonprofit Association.
“When you look at the arts, it’s about quality of life,” Caldwell said. “Arts and culture organizations always suffer when essential needs are being threatened. Essential services, while absolutely critical and necessary, can’t come at the expense of the arts. The arts deserve support, despite the downturn, because they are key to creating the type of community that draws economic development.”
But Caroline Older, executive director of the Arts Council of Greater Grand Rapids, said people faced with financial pressures look at the arts as a luxury.
“A lot of arts organizations, like the symphony and the ballet, are creating productions and performances that are luxuries for people,” she said. “In changing economic times, when families have to examine their budgets, unfortunately purchasing tickets to the ballet or opera might be cut first.”
Jeffrey Power, an attorney at Warner Norcross & Judd who works with nonprofits, said arts organizations may be tempted to spend down endowments — which are smaller, thanks to the investment environment — to cover operating costs.
“The performing arts organization in Grand Rapids and Michigan are really up against it,” Power added. “It’s going to be interesting to see how they react.”
At Opera Grand Rapids, the season was cut from four performances to three, said Sarah Mieras, public relations and marketing manager.
“We have been impacted significantly,” Mieras said. “We are expecting a continued shortfall through the remainder of this season.”
Ticket sales pay for about 30 percent of the cost of production, she said. February through April is Opera Grand Rapids’ major donation season, as season ticket subscribers send in donations along with their purchase. Opera Grand Rapids draws its audience not just locally, but from 48 Michigan counties, three states and a Canadian province, she added.
But two weeks out, tickets sales for the Feb. 14 “The Elixir of Love” were lagging, with the house at 17 percent sold. Normally, at two weeks prior to the performance date, half of tickets are taken, Mieras said. She launched a marketing campaign that included a Web-based contest, giveaways and tie-ins with local bars, restaurants and coffee shops.
Several local arts organizations have reported slow ticket sales, unless the audience can save money through coupons or discounts. The Public Museum, for example, offered lower prices on adult tickets and let children in for free throughout the holiday season, President & CEO Dale Robertson said.
“We had a couple of the busiest days of attendance we’ve had in a long time,” he said.
Slow ticket sales in the recession boosted the importance of the success of Broadway Grand Rapids’ “Rain” for Messing and his organization, which lost money on its first two shows of the 2008-09 season.
“It’s one of the highest-selling shows we’ve had,” said Messing, who let season ticket subscribers vote on which touring Broadway shows they wanted to see this season. Ticket sales cover an average of 55 percent of costs, he said.