ACT NOW! FAQs and “Why don’t you just...."

What’s different about this “crisis”?

For PCPA, what is different about this crisis is that our revenue streams from endowments, grants, corporate sponsors, advertisers, and individuals that we have relied on in the past with a high level of predictability, have felt the impact of this global crisis and cannot provide funding.  The other major impact is that Allan Hancock College, our greatest supporter, is unable to help due to the impact of California’s budgetary crisis and the impact upon cash flow.

Why don’t you just charge more for tickets?

We hear this question with about the same frequency we hear – “why are the tickets so expensive?”  We live in a diverse community and part of that diversity is expressed in the diverse economic capacity of our audience and our potential audience.  We desire to serve the whole community and to avoid ticket prices being an inhibition to our neighbors’ ability to attend the theater.  We’ve also found over the decades we’ve served the Central Coast that our audience is quite price sensitive.  Frankly, it’s a challenge to get folks out of their homes and busy lives and into the theater no matter what the price of the ticket.  We sometimes see a decline in percentage of attendance that bears a striking similarity to the percentage of price increase for that season.  Our goal is to maximize access to the theater and, while we have tickets available to sell, address our revenue goals in volume of sales as much as possible before raising ticket prices to a point where some might have to stop attending.  While some ticket buyers are paying as much as $39.00 for a ticket, the average ticket for a PCPA production remains around $18.00 – less than one-fifth of what an average Broadway ticket would cost you.  If you’re one of those in our community fortunate enough to feel our ticket prices are too low, please buy more tickets and bring people to the theater or donate to the theater and help professional theater be available to touch the lives of everyone in the community.

Why don’t you just do more musicals or “commercial” titles?

A good number of our current audience enjoys the musical theater we produce and musicals have tended to attract strong audience interest, however, there are a few reasons we do not do more musical theater.  First, musicals are tremendously expensive to produce.  They tend to be multi-scene/set, large cast, many costumes, large crew, obviously require musical accompaniment, and we generally pay a royalty of 9-14% on the gross box office (with significant upfront guarantees) which amounts to tens of thousands of dollars.  So, while they generate good revenue they tend to be much higher cost to produce than most other plays.  Also, as a conservatory theater and the leading professional theater in the region, we have a commitment to presenting a diverse body of plays that will attract and edify a diverse audience.  We are committed to advance the cultural literacy of our community and the dramatic literacy of our students and those values have to be protected from the pressures of producing a purely ‘commercial’ season.  And frankly, we’ve seen that diversifying our offerings is smart business. Many civic light operas and producers of primarily musical theater are still very vulnerable to economic uncertainty.  The second answer to this query is; “We are.”  In the summer of 2009 we will be producing a season with four musicals and one new play.  We feel we can accomplish this in this very controlled time window and still maintain our artistic identity, serve the cultural literacy of our audience and the dramatic literacy of our students, and balance production scope and revenue/expense matters.

Why don’t you just extend the run of the popular shows?

Production schedules are determined twelve months in advance and casting is done for a season in an attempt to have actors rehearsing one production while performing in another simultaneously.  This is how we gain great efficiency and effectiveness in our schedule and in reduction of costs.  We have a tight calendar and there is little flexibility as we are running productions back-to-back.  We also have subscribers buying in advance of the season and promotional materials designed, printed and mailed well in advance of the season which also incorporates other Allan Hancock College uses of the performing arts facilities.  Once established, the schedule has little room for change.

Why don’t you just cancel a show or a part of the season?

76% of our costs are in people.  While we might choose to not use guest artists or designers on a production, and create a savings, we need to turn as many performances as possible to support the costs of our resident actors and designers – they have a dual role as teachers in the conservatory so we cannot do without them.  Our production staff is required to get the productions to the stage and our administrative staff is needed to market, sell and manage the productions.  All the components are required to make this company work.  If you cancel a show or a season there is no revenue contribution to pay the high level of fixed costs.  It is similar to a large capital investment in a machine that must be run constantly to make a return on the capital invested.  If we turn this human machine off the components will be parted out and the likelihood of reassembly and startup is improbable.

Why don’t you just layoff staff?

We are constantly analyzing our business and instructional operations to ensure that we are functioning at maximum productivity.  We are already operating at a minimum level of staffing.  There does get to be a point at which the engine cannot function without the parts it requires to perform essential functions.  One cannot simply choose to not have pistons or a cooling system.  We cannot cut any more without jeopardizing the ability to get productions to the stage.  PCPA staff members are already working long hours and long weeks to keep our production schedule on track and numerous positions that would normally be staffed with paid professionals are being filled by interns on scholarships.  Many of our production areas require very specialized skills and individual disciplines are basically single person departments and these professionals also comprise the core of our teaching faculty in the conservatory training programs.  So the truth is, PCPA already runs a very tight ship and we have made some reductions for this year.  Further reductions may result in our being unable to produce the work that is both the focal point of the professional training, the core of our service to the community and the product that generates revenue.

Couldn't you just reduce wages for staff who just love their work?

It is true that theater professionals enter their careers with an acknowledgement that it is a highly competitive and low pay occupation.  Work is very hard to come by – particularly with the consistency and excellent quality afforded us at PCPA.  Our staff is paid very little – people with graduate degrees and 20 years professional experience are making the minimum wage allowed by the state, even after many years of working with PCPA.  They do need to have food, shelter, transportation and other basic necessities.  Our staff has not received a cost of living adjustment since 2006 and that adjustment was the first since 2003.  These excellent professionals give their heart and soul, intellect and imagination to their work and do so at an extraordinarily high level.  A living wage does not seem too much to ask in return, and to be frank most of our dear staff are just making it.

Won’t the college, the city, the state, the Foundation board, the … somebody besides me… really just bail the theater out?

No.  There is so much uncertainty that we need to take the matter into our hands to make our patrons and community aware of the situation.  The State budget and legislature has been in a state of turmoil that some would characterize as chaos, the College is willing but unable, and at this point the hope is that if the community is aware of our struggle they will step forward.

What is PCPA doing to live “within its means”?

In the spring of 2008 as the global financial outlook was becoming clearer and darker, when we were developing our income and expense forecast for budgeting purposes, we adjusted our ticket revenue expectations down by about 10%.  It turns out, thus far, that our assessment was accurate and we are currently tracking just ahead of budget in ticket sales, proving that our forecasting was correct.  We also reduced our planned expenses by approximately $300,000 by eliminating several guest artist (directors, designers, actors and artisans) contracts across the season, eliminating some internships and their associated scholarship dollars, scaling back on individual production expenses and reducing our education and outreach programming by cutting the amount of offerings we could make available to local schools.  We made these adjustments in anticipation of a difficult financial environment, but it was impossible to grasp the enormity of the impact that would be felt in every sector of society.

How long will this last?

That is the question on everyone’s mind and of course we have very little to add to that inquiry.  It is clear that the recession will continue to affect theatres through the next fiscal year, and the State budget in California will certainly include cuts next year and into the future.  We expect more difficulties lie ahead.  In light of that expectation, we are doing all we can to refine our business model to act responsibly with the dollars the community has entrusted to us.  We continue to hope that our plays and musicals, education and outreach offerings and other programming will appeal to our audience, but we must prepare for a long continuation of current trends and continue to rely on the vision, faith and generosity of our community to keep PCPA thriving in its’ service.

Doesn’t PCPA always need money?  Are you just going to be back next year asking for support?

Yes.  We are a not-for-profit organization.  We exist for the public benefit and it is our hope that our ongoing service for the good of the community will continue to warrant the ongoing financial support of the community.  We hope that, as the theater will regularly need contributed income and ticket revenue, our audience will regularly contribute and come to the theater.  We would like that to be happening with a greater degree of balance and predictability, but the reality is we will always have financial needs in relationship to the level of service we provide and, as we’re good artists and good business people, we will always strive to responsibly get the maximum potential out of every dollar that passes through the organization.  This community counts on us to deliver year after year.  We hope we can count on you to support us – year after year.