A bar chart illustrating the deficit cycle faced by Intermedia Arts, its board, and its staff since 2000. The organization’s financial reserves were severely eroded even before the Great Recession hit; post-Recession, soaring expenses quickly eroded Intermedia’s financial gains.
Thursday evening, Intermedia Arts sent out a short, succinct to its media and newsletter lists:
Due to the organization’s current financial situation, the board of directors of Intermedia Arts has made the difficult decision to lay off all staff. Over the next 45 days the board will be evaluating options to preserve the mission of the organization. During this 45-day period, the board intends to meet commitments for previously scheduled events, rentals and similar activities.
We deeply appreciate the community’s support of Intermedia Arts now and going forward. We believe our mission is critical to the communities we serve.
If you have any questions, please communicate with the board at Info@IntermediaArts.org.
Intermedia Arts Board of Directors
The announcement surprised many in the Twin Cities theatre community, who had seen (and celebrated) the organization’s revival after a similar shuttering in 2008. According to a financial document on Intermedia Arts’ website, the organization had accumulated $1.4 million in grants and clocked in a surplus of $375,000 for the most reported year. Despite this, the organization laid off two staff members in July; after Thursday’s announcement, it was reportedly considering selling off its longtime home in Uptown Minneapolis.
An examination of IRS filings by the Twin Cities Arts Reader staff shows a long history of financial troubles at Intermedia Arts. Although the organization rebounded financially during its 2009-2013 fiscal years, posting five consecutive years of operating surpluses, the organization made relatively little payment on the balance of its debts after the 2009 fiscal year. Overall fundraising and program revenue such as ticket sales plunged with its 2008 shutdown, and the surpluses of bumper fundraising years in FY2012 and FY2013 were entirely eliminated by a combination of steeply climbing expenditures and a massive drop in contributions and grants in the following two years.
In FY2015, Intermedia Arts’s annual expenses had risen to their highest level since FY2000, equaling 96% of that year’s $1.6 million budget – but achieving only 46% of that year’s revenue. The result was the loss of almost $850,000 from Intermedia’s balance sheet – more than it had spent in all of FY2011.
Delving Into the Finances
To obtain the financial data discussed in this feature, the Arts Reader collected 16 years’ worth of publicly available Form 990c filings by Intermedia Arts. This data, covering the organization’s 2000-2015 fiscal years, paints a vivid portrait of an organization battling with financial and organizational inconsistencies. Documents were obtained from Guidestar, the National Center for Charity Statistics, Propublica, and other sources, including Intermedia Arts’ website. Interestingly, the only Form 990c document found on Intermedia Arts’ website was both out of date (a common issue with many area nonprofits’ websites) and used the wrong year’s form. We also examined executive compensation, outside labor, artist funding, payroll, and other details for clues about how Intermedia has performed under different leadership and what its operating trends are.
Here are several charts, tables, and graphs that illustrate some of the financial trends and challenges faced by Intermedia Arts as the 44-year-old organization looks to the future:
Amy Donahue and Hanne Appelbaum contributed to this article. Although there are some small discrepancies between the filing documents, these were not out of the norm for amended filings correcting or clarifying exact costs and revenue. However, since the amended filings were not available, the numbers illustrated above were drawn or derived from Intermedia Arts’ original filings.