Iconic Fargo Theatre confronts financial strugglesCountless photos have been taken over the years of the Fargo Theatre, turning the glowing green marquee into a beacon advertising the city. Look no further than ESPN’s decision to bring its nationally televised “College GameDay” show to downtown Fargo on Saturday morning, with the recognizable “Fargo” sign beaming in the background.
By: Erik Burgess, Forum News Service
FARGO -- Countless photos have been taken over the years of the Fargo Theatre, turning the glowing green marquee into a beacon advertising the city.
Look no further than ESPN’s decision to bring its nationally televised “College GameDay” show to downtown Fargo on Saturday morning, with the recognizable “Fargo” sign beaming in the background.
But what’s not broadcast in the widely circulated images of the iconic marquee is a clear picture of the nonprofit theater’s financial troubles.
The theater ran on deficits from 2009 to 2012, coming up tens of thousands of dollars short each year, according to Internal Revenue Service data and finance reports provided by the Fargo Theatre.
In the last three years, it has also conducted at least two major fundraising campaigns asking the community for large donations to help with major capital improvements and just to keep the lights on.
The theater did make money in fiscal year 2013, which ended in May, and Executive Director Emily Beck said she doesn’t want to sound ungrateful to all of those who have donated over the years.
“But I also don’t want to give the impression that, ‘Oh yeah, we don’t need anymore money,’ ” she said.
Beck said it’s too soon to say how the “College GameDay” broadcast will affect the theater’s bottom line. But the theater’s leading role in the ESPN broadcast is just one example of an issue the theater is trying to combat, Beck said: how to turn passers-by only using the marquee as a backdrop for photographs into customers or contributing members.
“It’s to get the idea that we’re more than just a façade -- that behind that beautiful façade is this living, breathing arts organization,” Beck said. “That’s always something that we’re trying to get out there.”
‘It costs money’
The last five or six years have been challenging for many nonprofits and the Fargo Theatre is no exception, Beck said.
In fiscal year 2009, the theater’s expenses were about $83,000 more than revenue, according to its 990 tax form. In 2010, it had a $148,000 deficit, in 2011 the deficit fell to $89,845 and its 2012 deficit was $89,843.
The 87-year-old theater has made some headway in the last two years by increasing film showings and through “generous individuals” who have forgiven some debt, Beck said.
In the latest fiscal year, from May 2012 to May 2013, the theater reported a net gain of $147,849, financial data provided by Beck show.
Some of the theater’s consistent financial woes can perhaps be explained by the product it sells, said Margie Bailly, executive director of the Fargo Theatre from 1997 to 2011.
“The primary art form it brings to the community is small independent films, and that will never cash-flow,” she said.
But just because the theater is a nonprofit doesn’t mean it shouldn’t be able to make a profit, Bailly said.
Hosting more live concerts is one option to make some revenue, she said. The theater also opened a second screen in 2009, which allows it to sponsor events without upsetting the scheduled movie releases.
“That particular strategy is beginning to work,” Bailly said.
Beck and Bailly also pointed to the theater’s successful capital campaign earlier this year, when the community donated more than $200,000 to help the theater convert from 35 mm film to digital format, a big change that’s been the final nail in the casket for many smaller theaters, such as the Safari Theater in Moorhead, Minn.
Hollywood studios have mandated that theaters switch to digital by promising to only produce digital movies starting in 2014.
The two-screen theater in Valley City, N.D., temporarily shut down this year when the owner put it up for sale because he couldn’t afford the digital conversion. Residents of Lisbon, N.D., raised more than $123,000 earlier this year to save their historic Scenic Theater.
Beck said Fargo Theatre leaders feel “pretty fortunate” to have a supportive community in Fargo.
“There are enough people in this town that think enough of this place where I don’t think we have to worry about (closing down),” Beck said. “And they proved that. They really rallied behind us and said, ‘Yeah we think this place is worth preserving.’ ”
While there are many community members who give often to the theater, Bailly said it can be frustrating to have to keep conducting 11th-hour donation drives.
Bailly threatened in late 2010 to turn off the marquee lights if she couldn’t raise $30,000 by the end of the year. She ended up getting more than $47,000 in donations.
“The community cares about the Fargo Theatre,” Bailly said. “They just forget that it costs money to run it.”
Future bright downtown
Inside Boerth’s Gallery on Broadway, the Fargo Theatre marquee is omnipresent. It’s on postcards, paintings and photographs.
On a wall near the back, there is the well-known photo series showing the worldly cities of Moscow, London, Paris and then Fargo, lit up by the theater’s marquee. The theater is also front-and-center on a 2013 Fargo-themed wall calendar.
Shannon Hedrick, a saleswoman at Boerth’s, said customers looking for something uniquely Fargo seek out the theater’s marquee, and artists have picked up on that.
The Fargo-Moorhead Convention and Visitors Bureau also uses the image of the Fargo Theatre in “a lot” of photos when selling the city to tourists, said Charley Johnson, president and CEO of the CVB.
When Bailly became executive director of the theater, she considered copyrighting the image of the sign. Johnson said he can recall one person asking him why the theater hasn’t done that yet.
Bailly chuckles about it now, saying it would be difficult to police.
“Punitive things never work anyways,” she said. “I just figured we’d look at it all as good publicity.”
Johnson said if the theater copyrights its image, then nothing would stop other historic sites downtown from doing the same, ad nauseam.
“All you can really hope is that people who do use it and take advantage of it will think of them when it comes to donation time,” he said. “But yeah, of course way more people have seen the outside of it than the inside of it.”
Johnson said the theater is a “wonderful asset” to the greater community and is a key tool in drawing tourists and events to the metro area.
He said the CVB gave $50,000 to the theater’s digital drive this year, but when it comes to donations, Bailly said the theater actually needs more people donating smaller amounts.
It’s the younger generation that tends to stay out of the philanthropic realm because they think they have to donate a lot of money, Bailly said. Even a $10 monthly donation would help, she said.
“We need to mentor our philanthropists for the future,” she said. “We need to get greater numbers at lower (dollar) levels and move them on as they become more capable of giving larger dollars.”
Bailly and Beck think the future is bright for the theater as downtown Fargo continues to grow.
With the city looking at a new City Hall and other riverfront development, and private developers like the Kilbourne Group prepping for big projects such as the proposed tower on the U.S. Bank Plaza, the theater will no doubt benefit, Beck said.
The theater has seen some growth in its daytime events, but Bailly believes a parking ramp – one in a better location than the underused Island Park ramp – could bring more daytime traffic downtown and to the theater.
Beck hopes that traffic will come inside the theater, not just stop for a quick photo.
“Think about contributing or just becoming an audience member or stopping in to buy popcorn,” she said. “That would be where we would like to move ideally.”