COLUMBIA — The Missouri Theatre needs an urgent injection of cash and an organizational overhaul in order to stay financially afloat, the outgoing chief executive officer said in an interview on Monday.
Eric Staley, who leaves office on July 31, estimated that the theater requires up to $1 million to regain its financial footing. He said the theater has enough money to keep running until early August.
“What happens after July 31 will be the responsibility of the (Board of Directors),” Staley said. He said he was resigning to go back to his private consulting company, Missionmapping.
The Missouri Theatre Center for The Arts' money problems started in May 2008, after the final cost of a renovation project — initially expected to cost $6 million — shot up to $10 million.
The theater is still $2.5 million in debt, and could owe another $400,000 if a pending arbitration judgment with one of the contractors for the renovation goes against the theater. A ruling is expected by Aug. 31.
Staley said the theater has set aside enough money to meet its monthly loan payments through the end of this year but needs more cash to continue paying a staff of five and to keep other operations going.
When asked whether the theater could close, Staley said, "There has been that risk even before I came on (as CEO)."
The 82-year-old theater runs an average monthly operating budget of $55,000, which is spent on staff salaries and other administrative expenses. The theater also makes monthly $23,000 loan payments.
Staley said $500,000 is needed urgently to reduce the $2.5 million debt load and to lower the monthly loan payments, which he called the biggest drain on the theater’s income. He said an additional $250,000 is needed to meet operating expenses, and $250,000 to underwrite shows that have the appeal to pull in big audiences.
He said the theater also needs a restructuring to save on operating costs.
During the renovation, the Missouri Symphony Society — which previously ran the theater — was split into four different entities to take advantage of fundraising opportunities and federal and state tax credits.
But with the renovation now complete, the four entities have led to increased administrative costs without bringing in enough money to pay the debt, Staley said.
Staley said the board will evaluate the theater’s organizational structure in a meeting planned for Tuesday evening. Staley, who announced his resignation as CEO after 10 months at the helm, said the board had accepted his six-week notice of resignation.
Two board members, Pat Lawnick-Ritchie and Amy Collette, declined to comment on the meeting and on Staley's resignation.
Collette, who is listed as board treasurer, said she will comment after Tuesday's meeting. Collette said in a May interview that the board had confidence in Staley’s leadership and the direction the theater was headed.
The biggest hurdle the board faces is a legal technicality that requires the theater to maintain the costly organizational structure for at least six years. Staley said the legal agreements "can be revisited."
The outgoing CEO cited organizing the theater’s accounts and raising donations of $500,000 during his 10-month tenure as his main achievements.
When he succeeded former executive director David White in September last year, Staley found a cash balance that could only support less than one month of operations.
An audit revealed that some of the shows the theater was screening were taking losses, and the board decided to cancel the popular Hot Summer Nights Festival, which was estimated to have lost $180,000 last year.
Staley said publicity on the theater’s indebtedness in the last two years has complicated fundraising efforts.
“When there is all this negative publicity, the tendency is for the public to stay away rather than see it as a call to take the necessary corrective steps,” Staley said.