The Carolina Theatre has met a city fundraising challenge and set a fundraising precedent its new leaders say moves the historic theater closer to sustainability.
In March, city officials agreed to provide the nonprofit that runs the theater up to $600,000 to help keep the theater operating after officials discovered an unexpected debt of an estimated $1.5 million.
In exchange, the City Council required the organization to match the funds dollar for dollar, provide increased financial accountability and hire a consultant to advise the CEO and board members.
The money is on top of an annual payment of about $654,000 the city pays the nonprofit to run the downtown complex.
The money has been raised through a variety of campaigns since businessman and philanthropist Dan Berman was appointed interim chief executive officer. More than $430,000 was raised from private foundations, corporations, board members and longtime donors in a campaign that ended in August. Additional money came in through a crowdfunding campaign and a 90th anniversary food truck dinner fundraiser.
Berman, who is volunteering in the position, replaced Bob Nocek, who resigned after it was disclosed that officials had discovered the unexpected debt. Nocek and then-board chairman Scott Harmon blamed the surprise debt on faulty accounting and on a finance employee who no longer works there.
Berman said the theater raised the $600,000 in matching funds by Thanksgiving.
By the end of the theater’s fiscal year, June 30, 2016, the theater had only $178,000 left to raise, Berman said.
This fiscal year, the theater has raised about $350,000. That means the theater has raised an additional $172,000 above the $600,000. Donations this year include $15,000 from the Mary Duke Biddle Foundation.
The theater’s current debt is less than $300,000, Berman said. Officials have a goal to erase the deficit within the next 12 months. He expects the results from the audit for the fiscal year that ended in June will provide a definitive answer on the amount of debt.
While the city match was an important goal to reach, the increased fundraising is a part of the theater’s new business model that also includes increasing its rentals and partnering with organizations such as Nashville-based promoter National Shows 2, which shoulders more of the risk when presenting shows at the theater.
The baseline for fundraising for the last several years was about $400,000, Berman said.
“Now we are looking for that number to be over $600,000,” Berman said. “That fundraising initiative is a big part of changing the business model of the theater.”
The Carolina Theatre’s board is close to advertising for the consultant required by the city, Berman said. The consultant will look at the theater’s entire business model and help hire the next chief executive operating officer.