Promising financial news for the Music Hall, MOT
There’s encouraging news on the fiscal front for two key Detroit cultural institutions — Music Hall for the Performing Arts and the Michigan Opera Theatre.
Music Hall, which risks default if it doesn’t raise $1.7 million by April 30, is halfway to that goal two weeks before their Feb. 12 fundraiser.
And the Michigan Opera Theatre, which has been on stable financial ground since 2012, announced Tuesday that it closed out the year with a balanced budget and a surplus of $532,582.
Of the two, only Music Hall faces an existential crisis, the dimensions of which it revealed Jan. 7. So it comes as no surprise that its president and artistic director, Vince Paul, sounds understandably relieved that they’ve already received $930,000 in donations.
“I’m happy,” he says. “They love us! It’s working! Because — you never know, you know?”
Music Hall, which has an operating budget of about $3.7 million a year, owes the largest chunk of its debt to a private-equity firm that demands to be paid off this spring. So Paul launched a $7-million, five-year capital campaign and is putting on a matching-grant fundraiser starring Chaka Khan at Music Hall on Feb. 12.
But the first, all-important step is garnering the $1.7 million before May 1. If it pays off that loan, which Paul took out after the 2008 financial collapse, Music Hall will free itself of $270,000 a year in debt payments.
“The $1.7 million is just the first phase of the campaign,” Paul says, “but it really got traction and got people worried and freaked out. We’re rolling, and I hope that gives people the confidence to continue giving.”
He credits Blue Cross Blue Shield of Michigan, Masco Corp. the Ford Motor Co., Lear Corp., Detroit Medical Center and the United Auto Workers, among others, for stepping up to the plate so quickly.
Paul’s cautiously hopeful they might be able to get the entire $1.7 million in the bag by the time the curtain falls on the Feb. 12 fundraiser.
“I think we have a shot,” he says.
For its part, MOT renegotiated its mortgage in 2012, at a stroke reducing its annual interest payments from $2.4 million to $370,000 — a lifesaver for an institution that was, as Artistic Director David DiChiera put it at the time, “drowning in debt service.”
Today MOT’s running a $11.9 million annual operation, and saw increases in 2015 in earned and contributed revenue.
The news of the balanced budget and $532,582 surplus comes as MOT President and CEO Wayne Brown closes out his first year with the organization.