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HomeMy WebLinkAboutIR 7180 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7180 To the Mayor and Members of the City Council March 17, 1987 Subject: Casa Manana Request for Forgiveness of Rental Payment 1.79 The City has received a request from Mr. Ted B. Bevan, President, Casa Manana Musicals, Inc. , that the City formally forgive rental payments for the years October 2, 1978, through September 30, 1987, and proceed with negotiations for a new lease. His letter and supporting documents are attached. For your information, the staff has prepared a historical summary of the City's contractual arrangements with Casa Manana Musicals, Inc. That document also is included with this I.R. Mr. Bevan, Producer Bud Franks, and other Casa representatives are scheduled to make a presentation at Tuesday's Pre-Council Meeting. Council direction on this issue is sought before an action item is placed on a future agenda. roll Additional information will be provided upon request . Douglas Haman, City Manager DH/RAM:sfnnn Enclosures 0OW-1 -ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS ------- -------- FORT WORTH SLIMMER MUSICALS P O. BOX 9054 3101 W. LANCASTER FORT WORTH, TEXAS 76107 • (817) 33?-93'9 BUD FRANKS, PRODUCER February 24, 1987 Mr. Doug Harmon City Manager City Hall 1000 Throckmorton Fort Worth, TX 76102 Dear Doug: I am writing concerning Casa Manana's rental agreement with the City of Fort Worth. Rental payments on the Casa Manana facility are $25,000 per year. From September, 1978 through September, 1986 , Casa Manana Musicals, Inc. has not paid rent, which would total $225,000. During this same time frame, Casa Manana has spent $280, 389 maintaining and enhancing the Casa facility. That computes to an average of $31,154 per year for maintenance and facility enhancement (please see Attachment I ) . Enclosed are Attachments (II, III, IV) which document the granting by the City Council of Fort Worth of rent due for the years 1976 and 1977. You will note within the Attachments, that, at that time, a request was made for clarification as to future rental payments and maintenance of the facility. As of this date, there has been no resolution of these issues. At this time, Casa Manana Musicals, Inc. is requesting that the City Council formally forgive rental payments for the years October 1, 1978 through September 30, 1987. This request has precedence as noted in the Attachments. The current lease agreement between the City of Fort Worth and Casa Manana Musicals, Inc. expires December 31, 1988. As the Board of Directors is in the process of preparing and enacting a five year plan, it is requested that discussions begin as soon as possible between the City staff and Casa Manana Musicals, Inc. with regard to a new lease. A new lease is imperative in the long range plans of Casa Manana as the Board of Directors would like to SUMMER MUSICALS PLAYHOUSE * SCHOOL • undertake a major fundraising campaign for the renovation and expansion of the Casa Manana facility. Bud Franks and I look forward, in the very near future, to the opportunity to discuss this matter with you and the City Council. Sincerely yours, Ted B. Bevan President CASA MANAMA MUSICALS, INC. enc Attachments I - IV cc The Honorable Bob Bolen cb 2 s. I. ►► CASA MANAMA MUSICALS, INC. FACILITY MAINTENANCE EXPENDITURES YEARS ENDING 9/30/78 THROUGH 9/30/86 9-30-78 $ 20, 180 9-30-79 19,728 9-30-80 23,606 9-30-81 23,973 9-30-82 18,170 9-30-83 16,813 9-30-84 27, 513 00,h, 9-30-85 46 , 382 9-30-86 84,024 $ 280, 389 Average per year: $280, 389 - 9 = $ 31, 154 t , ?! 1 i FORT WORTH SIAICITLEGRAM IN WMNESDAY EVENING,DECEVM 21, IT" Pay after profit r you n ci l asks work y on Casa rent p lan ' F The Fort Worth{Sty Council Tbesday Glean said the group which rents the asked the city staff to work on a proposal citybwrxd can Matuusa building,locat- that Gaga Mariana Musicals Inc.pay rent al at L.ancmter and Univers#y Drive,is lathe city only after it shays a profit. fading the same problem that has hind- Darrell Glenn,Can Mariana Whwcals eyed theatrical groups all across the p+esideirt. said the organization is two nation. years behind in its rent payments to the City.Mat amounts to$50,000 and must be ••7bere'is lA m new material bring added to operational losses of$74,000 in produced an Broadway. Ibis is forcing AM, revealed Matsaria's mane woes theater grau�ps to put oss productions of Y the old standards. i at Tuesday's coinx it meeting and pro- ested in these, but it does not promote posed a plan whereby the theater would Wen dance like new material would," pay rent when it made money. He said Glenn said. arty pectin would be split"with the In terms of quality,he said,this season sty. has been­the forest we've ever had"in 'The council then authorised the city liar*year history of the organization staff to prepare a new contract for the In order to help ease the situation, tM.ater slang lines suggested by Glesal. Glean said, the theater is calling in Gauncitman.liar Etagsby said the ne+w 8100,000 in pLedgts made earlier this year a� at slx�uid also defer rent pay- and is abocrt to unch ari ixrt+erisive drive its aha to aril Lukens for the IM ifeason ii �1• t e �ti ' I December 15, 1977 Honorable Hugh Parmer Mayor Protem Jim Bradshaw City Councilmen, City of Fort Worth 1000 Throckmorton Street Fort Worth, TX 76102 Dear Mayor and City Council Members: In our letter of January 27, 1977, a request was made that the annual rent for Casa Manana Theatre be deferred until the end of the 1977 season. The Council approved that request. !0` At that time, we were confident the 1977 season would prove to be profit-making. No effort was spared in the planning and execution of actions necessary to present a highly professional and entertaining season of Broadway musicals. The shows presented were the best in the history of the theatre. However, an unpredictable factor of public attendance caused a financial loss for the season in the amount of $74, 876. We, therefore, respectfully request that the Mayor and City Council approve the waiving of the 1976 and 1977 rent. Such waiver would ` not be a precedent as $50, 000 due the city by contractual agreement was waived for the Northside Coliseum. Also, $11, 000 was appro- priate`d-foi a deficit in operations of the Fort Worth Art Museum. This request would seem reasonable and in keeping with the annual appropriation to the Will Rogers complex in amounts up to $85, 000. It is further requested that the attached rental agreement be approved for future years. The terms of this agreement are consistent with those approved for Steve Murrin and the Northside Coliseum. This request is based on the need to establish a workable agreement for OP" future operation of Casa Manana. Page 2 Consistent with both of these requests, the 1977 season was underwritten by $100, 000 in pledges from firms and individuals of Tarrant County. These generous supporters are now paying their proportionate share of the season's loss. We feel it reasonable to expect the Pity of Fort Worth to share this loss by the waiver of rent and approval of the agreement. We would welcome the opportunity to meet with you at the next scheduled City Council Meeting to present further financial information or any other information that might help your Honor and the Council arrive at an affirmative decision in favor of this consideration for Casa Manana Theatre. Respectfully, RRELL K. GLENN resident Board of Directors CASA MANAMA MUSICALS, INC. Enclosure This amendment to the contract between Casa OW Manana Musicals, Inc. , and the City of Fort Worth entered into this day of , A.D., by and between the City of Fort Worth acting by and through Rodger N. Line, its duly authorized City Manager, and Casa Manana Musicals, Inc. , acting by and through its duly authorized President, Darrell K. Glenn. WITNESSETH WHEREAS, the City of Fort Worth and Casa Manaus. Musicals, Inc. , have heretofore entered into a contract and agreement of the 20th day of June, 1958, and subse- quently amended the same at various times, the last such amendment having been executed on January lot, 1975, by agreement designated City Secretary Contract No. 8178 on file in the Office of the City Secretary of the City of Opp, Fort Worth; and WHEREAS, the City of Fort Worth and Casa Manana Musicals, Inc. , mutually desire to further amend said Contract No. 3988 dated June 20th, 1958, to eliminate all uncertainty concerning the annual rental payments due; NOW. THEREFORE, In consideration of the premises and the mutual cove- nants and agreements herein contained, the parties do hereby covenant and agree as follows: 1. The amount of annual rental to be paid by Casa Manana 'Musicals, Inc. , during the term of this agreement *hall be an amount equal to fifty percent (50%) of the difference between all gross receipts, received and realized by . Casa Manaus, Musicals, Inc. , and the operating expenses incurred by Casa Manaus, Musicals, Inc. , from their operations hereunder. For all purposes therein, gross receipts is hereby defined as all receipts of any nature whatsoever to Casa Manana Musicals, Inc. , resulting from the use of the herein leased building and/or grounds, including but not limited to admissions, program sales, parking, concessions and sub-leases and excluding only contri- ff h 3'f lttJx•rts} , t _ buttons, proceeds from loans and proceeds from the sale of fixed assets. It is specifically understood and agreed that the gross receipts from the operation of the Casa Manana Playhouse Theatre School are not included as receipts to Casa Manana Musicals, Inc. , but that all amounts paid or credited to Casa Manana Musicals, Inc. , by the Casa Manana Playhouse Theatre School are included. It is further understood and agreed that in the event Casa Manana Musicals. Inc. , sub-leases the buildings - and/or the grounds to third parties for special promotions or performances, the gross income to Casa Manana Musicals, Inc. , from such sub-leases shall be included. The fiscal year of Casa Manana Musicals, Inc. , shall end on September 30 of each year during the term thereof; that an audit of gross receipts for each fiscal year will be made by an independent Certified Public Accountant of firm of Certified Public Accountants at the sole expense of Casa Manana Musicals, Inc. , that such audit will be furnished to the City Manager and that the annual rental for the fiscal year shall be computed upon the results as determined by such audit. 2. Casa Manana Musicals, Inc. , shall: a. Provide day to day minor maintenance on the' demised premises. L b. Provide day to day minor repair of the demised Op premises and to the equipment necessary to the operations Of Casa Manama Musicals, Inc. , c. Provide cleanup of the demised premises and equipment. 3. The City of Fort Worth shall: a. Maintain the exterior walls and roof of Casa Manana Theatre and carry fire and extended coverage insurance on the building. b. Continue to provide maintenance of grounds and J landscaping. C. Provide major maintenance on or replacement of such equipment as deemed necessary to the operation of Casa Manana Musicals, Inc. , in the demised premises. 4. That the effective date of this amendment shall be and shall terminate when a sufficient amount of money has been collected as rental to meet the debt service payment requirements associated with the demised facilities. 5. That except as specifically amended by this agree- scent, all of the provisions of said Contract No. 3888, as amended, shall remain in full force and effect. Executed in the City of Fort Worth, Tarrant County, Texas, this day of CASA MAN MUSICALS, INC. B RRELL K. GLEN ,,fir resident Board of Directors O 3 III September 25, 1979 Mr. Loyd L. Turner, President Casa Manana Musicals, Inc. P. 0. Box 9054 3101 West Lancaster Fort Worth, Tex&s 76107 Bear Loyd; Please forgive the delay in responding to your letter about the Casa contract. As you know from following the news media, we have been very busy down at City Hall . I have asked the staff to prepare a report for the Council regarding Casa. You should be hearing from us in the near future. Congratulations on completing a successful season. Sincerely, Woodie W. woods Mayor WWW.fc bcc: Morris C. Matson, Assistant City Manaqer r A J1 STATUS REPORT ON CASA MANANA TO FORT WORTH CITY COUNCIL by Loyd L. Turner, September 22, 1980 Mayor Woods and members of the city council . . . I appreciate this opportunity to give you a brief status report on Casa Manana. Casa 's executive committee and Mr. C. E. (Bud) Franks, our producer/general manager, who is here with me this morning, believe that this is an appropriate time for such a report, for two reasons. First, the 1980 summer season at Casa has just ended. Second, this is my last week as president of Casa Manana--a responsibility which I assumed two years ago when Casa was in deep financial trouble. In May 1979, with the board' s concurrence, I appointed a blue-ribbon panel of community leaders to study Casa Manana and its problems and to make recommendations for solving those_ problems. This panel, in turn, engaged Moore Diversified Services to gather the necessary data, conduct surveys, and personally visit comparable theatres in several other cities. The result was a comprehensive report containing nine specific recommendations for Casa' s future operation--recommendations like more variety in the shows, more name stars, more one- week productions, more emphasis on season ticket sales, and more authority vested in the executive committee. Casa' s board and staff followed these recommendations in mounting the 1980 summer season. In spite of this all-out effort, Casa Manana did not quite break even this summer. our unaudited figures indicate OPOI that Casa lost approximately $10,000. This loss is both minor And aCanageable. Any loss does not sound good, but it sounds better when compared to Casa 's losses in prior years and to the major losses suffered this summer by many theatres around the country. Adding to Casa' s problems this summer were the recession and a record-breaking heat wave that discouraged many a would-be patron from venturing out at night. Total attendance at Casa this summer was 116,601, which correlates to 69 percent capacity. About 20 percent, or 23,320 of these patrons, care from outside the Southwest Metroplex. During the past two years, Casa has made substantial progress. We have identified the major problems and have solved several of them. We have completely revised our bylaws, have improved the organizational structure of the board, have increased season ticket sales, have brought more variety to Casa's circular stage, have instituted an underwriting program, and have enough money in the bank to launch the 1981 season. We are in far better shape than we were two years ago when we were almost forced to close Casa' s doors. Mayor Woods, who as honorary chairman of Casa's board has attended several. of our board meetings, can verify that assessment of Casa's current condition. But not all of Casa' s problems are behind us. one of our problems is Casa' s rental agreement with the city. As you will recall, in 1977 and 1978 the city council made it possible for Casa to continue operating by generously waiving Casa's rental payments for 1976 and 1977. Also, you may recall, in January 1978 Casa submitted a proposed new contract to the city council. For various reasons--perhaps good ones--the city has neither agreed to that contract nor proposed an alternative. Cam's board of directors feels strongly that we should have a contract with the city calling for rental payments to the city, at least in those seasons in which Casa makes a profit. At the same time, we feel quite strongly that the city should be responsible for maintenance of the Casa Manana facility. Casa is now 22 years old. It has never had a year- to-year maintenance program, and as a result it is getting a bit rundown at the heels. Casa has provided some maintenance-- not much--because it's hard enough trying to run a summer theatre off of income from ticket sales without trying to maintain the place. CasalsphNsical plant needs the following short-term maintenance: niew seats • caulking the entire roof • new external doors • improved landscaping maintenance In the long run, the Casa facility needs massive renova- tion, including • totally new landscaping • additional office and rehearsal space renovation of current restrooms and addition of new restrooms • renovation of the La Cantina area renovation of the entire lobby and concourse area Although strapped for funds, Casa's board earlier this OPOI year contracted for a new sound system, which was desperately needed and which is now nearly completed. This sound system, -3- 4 in the board's opinion, should be considered a part of the real property, and we feel that the city should assume financial responsibility for it. We realize that finding funds for all of this maintenance and renovation will be difficult. As a matter of fact, it' s out of the question for this year, since the city's budget is now in its final form. But the need for the maintenance and renovation of Casa will become increasingly evident in the months and years ahead. We urge you and the city staff to consider the needs of Casa as you prepare the city' s annual budgets in the future. One logical source for some of the necessary funding would be the additional one percent bed tax earmarked by the state legislature for the stimulation of tourism. The Arts Council of Fort Worth and Tarrant County has asked that a portion of this bed tax be allocated to it. Perhaps you will be able to grant this request. If so, Casa Manana, which is an important year- around attraction for visitors and tourists, should also receive its fair share of the bed tax. Those visitors to Fort Worth who will be paying the hotel bed tax should be able to enjoy professional theatre in a facility of which the entire community can be proud. Incidentally, the Casa board and its producer-general manager are looking forward to next summer, when two first- class hotels will be open in downtown Fort Worth, bringing more conventions, more visitors, and more potential Casa patrons to our city. Again, thanks for this opportunity to report on Casa Manana and to alert you to some of the problems that lie ahead -4- for one of our city's best-known entertainment assets. If you have any questions, I 'll be glad to try to answer them. If I can't answer your questions, perhaps Bud can. TO: Ruth Ann McKinney, Assistant City Manager OP,hl FROM: Edwin Cook, Financial Planning/Analysis Officer DATE: March 11, 1987 SUBJECT: Casa Manana History On October 2, 1945, the citizens of Fort Worth approved a Capital Improvements Program authorizing the issuance of General Obligation Bonds in the amount of $500,000, for the construction of an amphitheater on the Casa Manana Site on the Will Rogers Memorial Coliseum grounds. On Friday, January 17, 1958, the council authorized the issuances of $500,000 for construction of the Recreation and Amphitheater Theater. The Bonds were sold as a part of the $3,475,000 of General Obligation Bonds issued on February 26, 1958. A non-profit citizens' group known as Casa Manana Musicals, Inc. operates the building as leasee for the City. The group is funded by revenue from the summer musicals and contributions from citizens and businesses and enrollment fees from theatre school. The Casa Manana Playhouse division was organized in September, 1962 as an education and entertainment institution to add to the cultural development and quality of life of our children. The City entered into a lease agreement with Casa Manana Musicals, Inc. from July 1. 1958 through December 31, 1958 for $14,090.00 and $28,180.00 per year through December 31, 1962. On May 19, 1961, the Council approved a reduction in rent for the Casa Manana Building from $28,180.00 per year to $16,178.50 per year. This was to be in effect for one year only, from January 1, 1961 thru December 31, 1962. On December 17, 1962, Mr. J. H. Snowden appeared before the City Council and requested that the lease rental on the Casa Manana Building be reduced for a five-year period from the contract amount of $28,180.00 annually to $16,178.50 annually. The Council authorized a reduction in the annual lease rental amount paid. Beginning October 1, 1964 thru September 30, 1965, and amended on August 9,1971, the City entered another agreement with Casa Manana Inc. based on per cent of gross receipts(1.5% up to $400,000.00, 20% of $400,000.00 to $450,000.00, and 25% over $450,000.00). This new agreement also changed the reporting period of the Casa to that of the City. The August 9, 1971 requested amendment provided annual rental payments to the City not to exceed $30,000.00 for the years 1971, 1972, and 1973, which were due and payable on or before December 31 of each year; and that the annual rentals after 1973 and annually for each succeeding year through December 31, 1987 not to exceed $25,000.00. The City Council approved the requested amendment. On December 23, 1974, the council approved another amendment changing the annual payment from a maximum of $25,000.00 to a minimum annual payment of t r $25,000.00. It was to remain in effect until 1975. On February 24, 1975, the council amended the contract with Casa to provide a flat annual payment of $25,000.00 per year and extend the life of the contract from December 31, 1987 to December 31, 1989. On January 27,1977, Council deferred the payment due in December 1976, until September 1, 1977. On January 3, 1978, Council cancelled the rental payments due for the years 1976 and 1977, a total of $50,000.00. In reviewing the records for receipts from the Casa Manana Musicals since 1977, no payments have been recorded. The attached analysis shows the total debt payments requirements verses the amount of receipts from Casa Manana.