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The ArtsCenter Draft Business Plan <br />19 <br />SECTION 'r F inanc a i Ma a `-1Ement - D,bt - - <br />As detailed in the above sections, the managemert of The. <br />ArtsCenter is chanq nq this nature of ontractinq for <br />performances and other offerinq t a <br />each program self- <br />sufficient. Over the Ions term of the fiscal ear, <br />pr•ogramminq will be able to bear the burden of operating <br />costs throucah careful budaeting and eliminating area_; which <br />pr,odi-ics losses. As the vinter becomes financially solvent, <br />the longer term objective will be to provide funds for those <br />rogr ams which Cannot support themselves. This will be drone <br />y ur-suing grants and sponsorships for the various <br />productions. <br />While we are wcyrk:inq toward this qoa.., we are also struggling <br />with the management of the large debt incurred by bui.l.d tr g <br />and renovation cost. The course of action that mianagemeni is <br />considering at this time is as follows: <br />K Vigorously pursue funding sources who provide capita! <br />finds for purchase of -facilities. 14 me can obtain <br />funds to purchase the facilitv and M P allows us tc, <br />exercise our original option., we will be able to <br />eliminate the major portion of the debt almost <br />immediately. <br />The capital campaign will involve qr.an t proposal <br />requests to three foundations. Th?se proposals will <br />include a mortgage currently being negotiated with a <br />credit union which will show the t'-c:un8ation that the <br />community is interested in helping The ArtsCenter <br />purchase its own space thereby makinq the foundation <br />aware that their• grant will mot be the only money <br />invested in the c6mmunity center-., We are Hopeful that <br />the credit union details will be worked out by the <br />middle of December 1990. <br />2. At the same time, a consolidation loan of current <br />payables due by !1 December 1990 (including active, <br />.judgements against the center-•) is being considered. <br />This loan will afford us time to pursue the funding as <br />noted above. The amount due in November is U.Z, 4"_a. 11 <br />and in December $14.454.89. We area currently ii <br />negotiation for a consolidation iman with a local <br />lending institution. <br />An alternative to the consolidation loan is to use <br />the Business Campaign as a method of reducing the debt. <br />Since the Business Campaign is intended to reduce the <br />back: debt, which is not included in this budget, the, <br />income from this campaign is also not included. We will <br />revise budget projections to include debt service once <br />the campaign details have been worked out. The Frey <br />point in using this method to reduce the debt is that <br />there is no interest involved with maintaining the <br />payable schedule currently in existence which will not <br />increase the debt. <br />The board will have to make a decision on which avenue <br />to pursue. It may be advantageous to pursue both <br />options with a reduction in the amount of the <br />consolidation loan with a major portion to comes from the <br />Business Campaign. The board will be meeting on 20 <br />November 1990 where these two options can be presented. <br />-11- <br />