Funding Still a Challenge for the Ann Arbor Summer Festival/Top of the Park

Funding Still a Challenge for the Ann Arbor Summer Festival/Top of the Park

by Christian Usera

IT’S JUNE IN Ann Arbor which means the ubiquitous Ann Arbor Summer Festival (A2SF) is set to kick off on June 12 with over 140 events. The much anticipated 32-year-old festival has featured music legends such as Johnny Cash, Aretha Franklin, Dizzy Gillespie and Tony Bennett, among others. Its 2015 Main Stage offerings include the Indigo Girls, The Capitol Steps and Pink Martini (a group that blurs the lines between classical, Latin, jazz and pop.)

A2SF’s sponsors include local cornerstones such as the University of Michigan, Bank of Ann Arbor and the city of Ann Arbor. In 2014, The Ann Arbor Independent was a media sponsor. National sponsors include the National Endowment for the Arts. However, some years have treated the non-profit A2SF better than others. For example, in 2009 and 2010 Pfizer and Borders (both sponsors of A2SF) pulled out of Ann Arbor amidst the recession. Additionally, many businesses were hesitant to donate during those belt tightening years.

Amy
Arguably, the turn-around in the finances of the non-profit Ann Arbor Summer Festival corresponds with Amy Nesbitt’s (pictured here) hiring as Executive Director in January 2014.

Despite some minor losses in 2011 and 2012 under Robb  Woulfe’s leadership, the organization managed to turn things around during the 2013 season through a combination of lowering expenses and staff cuts resulting in a savings of $175,000. The non-profit also saves money each year through a City Council granted exemption from the city’s Living Wage Ordinance. This means Festival workers may be paid $8.15 per hour, as opposed to $14.18 per hour.

Savings also came from Amy Nesbitt herself. The new Executive Director was paid $69,000 according to the A2SF’s 2014 IRS 990 tax statement. Nesbitt’s predecessor, Robb Woulfe, was paid a salary of $116,000.

According to former Treasurer Michael Dubin, expenses can vary depending on how many acts are booked for the Main Stage. (Which artists are invited to the Main Stage also contributes to expenses.) Dubin cautioned against just viewing the non-profit’s tax records, which do not show the full variability of expenses and revenue. In addition to cost-cutting, there was also a gift from a Michigan-based donor whose contribution assisted in keeping the organization in the black.

This gift suggests that individuals within the community believe in this behemoth month-long extravaganza. A2SF 2015 is one of the largest festivals in Ann Arbor—acrobats, famous musicians and free movies. (What’s not to love?)

Arguably, the turn-around corresponds with Amy Nesbitt’s hiring as Executive Director in January 2014. The Ann Arbor Independent sat down with Ms. Nesbitt to get her take on the organization’s past struggles and its current hopes for a vibrant future.

When asked what cost cutting measures she has put into place since her tenure began as director, Nesbitt offers up a list.

“Actually, off the top of my head I’d have to say that cutting down our programming pamphlet from 64 pages to four pages was effective in cutting costs. Most of the information found in our pamphlet, can now be accessed through an interactive app that allows users to locate events, create a schedule and even share the activity on Facebook. The new pamphlet is a much smaller color coordinated guide that allows folks to know what’s happening, when and where. The color coordinated itinerary was my idea.”

One doesn’t have to be an accountant to know that printing costs are expensive and aren’t the greenest way to showcase one’s brand, so the shift appears to be a welcome one. Approximately 26,000 individuals have downloaded the app. To put it into perspective, that number is roughly equivalent to 25 percent of the total population of Ann Arbor.

Amy Nesbitt hasn’t only cut her way to profitability. Additionally, A2SF has instituted a five year strategic plan, which includes several different funds to which individuals and businesses can donate. Those funds include the Annual Fund, the Imagination Fund, the Enrichment Fund, the Endowment Fund and the Rainy Day Fund.

The Annual Fund goes to-ward general operating expenses, the Imagination Fund supports international street artists and outdoor spectacles, the Enrichment Fund supports capacity building and capital investment programs, the Endowment Fund provides support to existing and new initiatives and helps create sustainability for the organization.

Lastly, the Rainy Day Fund goes to unexpected expenditures and helps shelter the organization from financial uncertainty, which according to both Amy Nesbitt and Michael Dubin, is a very real concern given that revenue and expenses can fluctuate significantly from year to year. Between 2010 and 2014, expenses rose as high as $1.5 million and were as low as $1 million.

Nesbitt emphasized that the organization gets much of its total $1.41 million in funding through community support:

“Our main driver of funds is beverage sales, which generate approximately $200,000 worth of revenue every year. Those sales, along with donations, fluctuate from year-to-year.”

Tax returns do show a pattern, however. Main Stage revenue has decreased by about $250,000 over the past three years while Top of the Park donations have risen by about $70,000. Last year the donation pitch to attendees who visited Top of the Park was to “Give Three to Keep it Free.” This year visitors are asked to “Give Five to Help it Thrive.”

Summer Festival finances are, in addition, contingent upon good weather. In Michigan, June is the rainiest month, with an average rainfall of 3.46 inches, according to U.S. climate data. Having too many rainy days for an outdoor event impacts the A2SF’s bottom line through loss of ticket and beverage sales.

In addition to sponsors and partners, donations and money given at the Top of the Park kiosks contributed over $326,000, according to the non-profit’s most recent income tax statement.

Amy Nesbitt explains, “Many in Ann Arbor assume that we are (solely) funded by the city or the university, (U-M) but that’s not the case.”

According to Kim Broekhuizen,  Public Affairs Specialist at the University of Michigan, U-M matches the grant money given to the Ann Arbor Summer Festival by the city of Ann Arbor. The city gives $25,000, which is then doubled by the University for a total donation of $50,000.

“Because the Summer Festival has been until this summer held on university property,” says Nesbitt, “we pay the university for police, trash pickup, electricity, etc.  Unlike a ‘For-Profit’ organization, we have so many variables to contend with.  For example, we recently moved from South Ingalls Mall to North Ingalls Mall, which has given us some challenges, due to the fact that the space is narrower than our last venue. We’re going to have to create a different ramp for handicap access, create different stages, along with accommodating different trash recycling/pick up and security needs. We also will have to create different food prep areas for private events. We’re essentially creating a mini-village for one whole month, so by changing the venue there’s a lot of variables that make it difficult to always pinpoint expected costs for the event. We’d like to ideally move back to South Ingalls Mall, where we will have a better idea of costs.”

When asked if she would consider a permanent change of venue, Nesbitt said, “It’s good stewardship to focus on expenses, by striking a good balance between fiscal oversight and dynamic programming. We have a fantastic Board that is heavily active in our organization. I think that our obligation is to meet our commitments. We’d have to have an open mind (if a venue change were necessary).”

Nesbitt, a skilled ambassador for her festival, ended with a reminder that the Summer Festival is, really, a community-sponsored event.

“A2SF is a 501c3 which gets modest support from University of Michigan and the city of Ann Arbor. It’s supported mainly by the community. It’s the individuals attending and donors (who make this event) not some magic wand that’s waved by the city. We’re a non-profit and we would love for people to come out with an open mind and maybe try something new. You can’t download this experience. You have to be there.”

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