"We're just laying all our cards on the table," Intiman's communications director Becky Lathrop said just before sending me a state-of-the-theater email.
Given the long tradition of regional theaters trying to hide their troubles until the last possible minute—and how that practice usually leaves theaters to bleed until it's too late, or almost too late, to save them—Intiman's approach seems wise. If it isn't too late already.
So. The troubles: Unless Intiman raises $1 million by September, it will shut down. That figure is above and beyond the theatre’s 2011 annual fundraising goal.
The 39-year-old regional theater (formerly led by Tony Award magnet Bart Sher) realized what kind of mess it was in after the sudden and unexplained resignation of managing director Brian Colburn.
An email just sent from Intiman elaborates:
Since the departure of our former Managing Director last fall, the board of trustees has unearthed a series of missteps and management failings. Inflated budget projections, unpaid bills and a complete lack of financial and accounting oversight have left the theater dangerously low on cash. Sadly, I must report that unless we are able to raise $500,000 by the end of March, an additional $250,000 by June, and $250,000 by September, we cannot continue.
A full fact sheet from the theater, describing what happened and the steps being taken to save the institution, is after the jump.
INTIMAN FACT SHEET
* The former Managing Director resigned on November 1, 2010. Personal reasons were cited.
*Significant financial problems were uncovered at this time, putting the theatre into crisis mode. These include:
* Misrepresentation and nondisclosure of the theatre’s financial stability and related financial issues to the Board and the various committees responsible for financial oversight of the theatre.
* Unauthorized transfers by the Managing Director of restricted funds in the Foundation to the theatre’s operating account. Neither the Board nor Foundation Board approved the transfers.
* Failure to meet best-practice standards in the finance office: severe inaccuracies and months-long backlog of bookkeeping, cash-flow attention, staffing capabilities and general reconciliation and accounting.
* Mismanagement of and misrepresentation of financial impact of negotiations with co-producing entities.
* Mismanagement of verbal pledge agreements from two key donors, resulting in a loss of revenue in the FY2010A budget.
What Immediate Actions Were Taken?
* Replaced Managing Director and Finance Director
* Promoted Melaine Bennett, then Director of Development, to Acting Managing Director.
* Engaged professional consultation from Dean Barney, CFO and respected arts finance manager.
* Hired Interim CFO, Barbara Anderson, who has just completed a first draft of the financial statement for the FY10A and 10B
* From Nov. 1st through 2/4/2011, raised $874,315.
* This number includes all CASH in; gifts, pledge payments, corporate, foundation government, etc. It does not include pledges.
* Of that $874,315, $348,598 was from the Board.
* Created a rent repayment plan to bring Intiman current with Seattle Center.
* Repaired relationships with unions after discovering there were lapsed payments.
* Caught up on taxes.
* Identified past payables and created plans for repayment installments for the majority of accounts; plans are continuing to be developed with all vendors.
* Created a cash plan to get into 2011.
* Created a budget for 2011 that cuts over $1.4million (25%) from the previous 12-month budget.
* Commenced a 21-month audit to complete the financial picture for the 2009 and 2010 Seasons. Intiman changed its fiscal year calendar in 2010: previously ending March 31 and now ending December 31.
* Produced The Scarlet Letter and co-produced Black Nativity with STG, completing the 2010 Season.
What Further Actions Continue?
* Creating a fundraising initiative that will allow Intiman to operate in best-practice operations, create excellent theatre, engage the community, be a gathering place for ideas and art - AND go into the 40th Anniversary in 2012 debt-free. The campaign requires raising $500,000 by the end of March, an additional $250,000 by June, and $250,000 by September.
This is above and beyond the theatre’s 2011 annual fundraising goal.
* Establishing new Task Forces from the Board to continually monitor fundraising, past payables, vendor communication and the budget.
* Increasing board involvement in all areas of oversight for the various departments, especially in the areas of finance, accounting and budget tracking.
* Creating benchmarks for fundraising goals in the extraordinary giving campaign for 2011.
* Reducing staff to a 4-day week and working within the current budget to produce the 2011 plays.
* Reinstating checks and balances systems from the Board down to hourly staff who handle money.
* Documenting all practices and procedures.
* Identifying new CFO (in progress).
* Cultivating new Board membership (including one candidate who has an auditing background).