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Published: Wednesday, 11/23/2005

$2.8 million debt could take glitz from Tiffin Ritz

BY STEVE MURPHY AND VANESSA WINANS
BLADE STAFF WRITERS
Tiffin's Ritz Theatre, which had more than $2 million in debt when it opened in 1998, has not been able to generate enough income to cover its expenses. Tiffin's Ritz Theatre, which had more than $2 million in debt when it opened in 1998, has not been able to generate enough income to cover its expenses.
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TIFFIN - Struggling with $2.8 million in debt, rising expenses, and falling ticket sales, the historic Ritz Theatre in Tiffin is trying to reorganize its finances and keep its doors open.

The board of trustees of Tiffin Theatre Inc., the nonprofit corporation that owns the 77-year-old facility in downtown Tiffin, plans to ask a committee of financial, legal, and arts professionals to review its finances and "make recommendations regarding the feasibility of continued operations," a statement from theater officials said.

"If we pull together, we might be able to save it," said Dominic Fabrizio, president of the board of trustees. "We do have some time here. We don't know how much, but we're scratching and clawing and doing everything we can to keep it open."

Tiffin Theatre Inc. took over the former film palace in the late 1980s and started a capital campaign to restore the theater to its original glory. But the renovation project's estimated $4.3 million price tag ballooned to $6.6 million because of cost overruns and additions to the original plans.

The fund-raising effort generated just over $4.1 million, leaving the 1,200-seat theater with a shortfall of more than $2 million when it reopened in 1998.

Since then, the theater has presented shows by such entertainers as Joan Rivers and Tanya Tucker, but its income has been insufficient to cover expenses, monthly interest payments of more than $18,000, and quarterly principal payments of $35,000, theater officials said.

"This is certainly nothing that popped up today," said Michael Strong, the theater's director since September, 2004.

"We're $2.8 million in debt, and we've been carrying that for some time. Over the past six or seven years, we have had cash reserves the business was able to draw on to cover those losses. Those cash reserves have been drained," he said.

Seven banks hold equal shares of the debt, Mr. Strong said. "The banks have asked us to come back with a business plan that projects how this business could perform in the future," he said.

Theater officials cite a slow local economy and rising fuel prices as factors that have worsened the Ritz's financial plight.

Mr. Fabrizio said ticket sales this year are down more than 40 percent, partly because of a decision to shift away from expensive, big-name acts. But even well-known artists have failed to attract big crowds: About 400 tickets were sold for Ms. Rivers' Nov. 13 appearance, he said.

The Tiffin venue's money woes came to light a week after the Sandusky State Theatre closed because of a cash shortfall and debts of more than $700,000.

"It's been a struggle," said Dianne Pytel, a member of the Ritz's board of trustees. "Truly, things changed, as they did for everyone, after 9/11. We suffered some setbacks in investments where we had our money, we lost some money there. The climate has changed as far as people spending their money for tickets, and we also went through a change with our executive director - and change is costly."

The Ritz tried this year to raise $3 million from donors to retire the facility's debt but suspended the fund-raising effort recently "because the organization's short-range financial forecast is very weak," according to the statement from theater officials.

Board members and theater staff met with the facility's debt holders last week and failed to win an agreement from the banks to forgive the debt.

Still, Ms. Pytel thinks the Ritz can be saved. "I believe that now that we've gone public, I think there will be support from the community to bring us back to where we have been before," she said. "It's such a vital part of our entire community."

Contact Steve Murphy at:

smurphy@theblade.com

or 419-724-6078.



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