Some Thoughts on the Paper Mill Situation

I'm stepping out on a limb here, but I want to say I'm really rather peeved by the dangerous crossroad that the Paper Mill Playhouse has reached. Mind you, I don't want the theater to shutter – far from it. I've spent many enjoyable afternoons and evenings there taking in the institution's often lavish productions. (I call it an institution rather than an organization because after 69 years the theater is an institution).

So, if I'm not rooting for the theater's demise? Why am I peeved? Well the thing is that I spent 8 years of my life working as a fundraiser – for one major institution – The New York Shakespeare Festival and also for two smaller non-profits, and know that the process by which a theater arrives at an annual operating budget is a carefully orchestrated tango between artistic staff, management and an organization's board of directors, trustees, or whatever term has been used in a group's bylaws.

The staff, starting with the artistic director, announces what his or her dream season will be. Management – by which I mean financial departments, fundraising, and general management – then estimates how much the season will cost, and also projects what sort of revenues can be expected at the box office and from private contributions. Normally there's a rather big difference between the expenses and the income side. It's why artistic directors are who they are…they get to dream big.

So, now, this is where the dance comes in. It's been my experience that before going to the board, the staff will attempt to minimize the gap between income and expense, examining how more money for a season can be found, and by trying to trim as much as possible from the expenses of a new season of plays and ancillary activities (like an education program).

With a shortfall still in place, the staff normally meets with the board – that must approve the budget as they are ultimately the fiscal guardians of the company. Now then, in some situations, the board will demand that the staff revisit the figures and come up with a balanced budget. At other times, the boards, like those with which which I've worked, will approve a budget with a shortfall that they feel, given historical fundraising capabilities, can be balanced during the course of a fiscal year.

Making sense? Anyway, for whatever reason, the board at the Paper Mill approved a budget with a $2.5 million shortfall. That's not insignificant for an organization with an annual $17 million budget where, according to reports, only 20% (or approximately $3.4 million) has traditionally been raised. In spite of this, the board felt that they would be able to raise the additional money before a crisis, such as the one the theater now faces, arrived.

Now then, look at those numbers. The board said that somehow, someway, it would be able to almost double contributed income in less than 12 months. Now I know the economy is healthy. I'd not realized it was that healthy. Making this situation more troubling are the facts outlined in a recent article in The Star Ledger that reports that up until this year, the board members for the Paper Mill had given or raised just under $120,000.

Optimism is one thing, but this is something else. And the reason for the strange sense of anger and sadness that I feel about what's going on over in Millburn. While the board is to be commended for its increased giving this year, they must also be condemned for allowing the theater to proceed with such unhealthy financial expectations. Maybe a show should have been dropped from the season – yes that means less ticket revenue, but it also means reduced expenses, which seem to be outpacing the box office anyway.

This is not unheard of. It's not only fiscally responsible: it sends an early signal to theatergoers, funders and politicians that there is a problem that needs to be addressed. Instead of sounding this alarm, the theater's staff and the board are scrambling to make sure the theater stays open on what amounts to a day-to-day basis. An unhealthy juncture both artistically and institutionally.

In all fairness, I should remember that board members are volunteers who donate not only their money, but also their time and varying levels of expertise to a non-profit. At the same time, they are, for all intents and purposes, the rather strict parents who must often have the unpleasant task of saying "no" to their offspring. It's not a pleasant thing to hear or say, but it's often necessary.

Similarly, the Paper Mill's staff should have looked beyond the Board's promises and exercised their own fiscal restraint, thus proving that sometimes it's necessary for children to raise themselves. Sadly, in theater, and in life, this should not be the case.

Until later next time,

Andy Propst

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For those who want the direct URL to the story mentioned:

Paper Mill's fundraising performance falls short - The Star-Ledger
http://www.nj.com/starledger/stories/index.ssf?/base/news-11/1176006512185030.xml&coll=1