DPAC's dramatic pause 

Performing arts center's public rift with local theater producer calls its mission into question

"We got 100 percent of the shows we wanted," says Florida Theatrical Association president Ron Legler, on the phone from the APAP Global Performing Arts Marketplace and Conference, the mid-January theatrical-presenting industry confab in NYC for producers and presenters looking to book performances in their cities. "Doesn't leave much for DPAC."

For the past 24 years, Florida Theatrical Association has been bringing touring Broadway shows to the stage in Orlando in national partnership with Broadway Across America, an organization that presents and produces live Broadway shows in cities across the nation. Florida Theatrical has staged everything from Wicked to Mary Poppins to West Side Story at the Bob Carr Performing Arts Centre, keeping the aging venue owned by the city financially viable by reliably filling its squeaky seats. But Legler recently learned that he and Florida Theatrical might soon have some competition from another local arts organization – one that was supposed to be an ally. It was Legler's hope that Florida Theatrical Association would be presenting its Broadway shows at the Dr. Phillips Center for the Performing Arts, the looming (and ever-changing) $500 million downtown boondoggle that claims that its goal is to support local arts organizations by giving them a superior performance space in which to present. But apparently, for Legler, that wasn't to be – instead, he went from potential DPAC collaborator to competitor in just one day.

On Dec. 18, DPAC announced that it would present its own Broadway performances when it opens next year, a move that, at least on the surface, seemed to catch Legler and his many local supporters off guard. Though DPAC president Kathy Ramsberger made it clear to the Orlando Weekly three years ago ["Keeping up appearances," March 24, 2010] that self-presenting was likely and that Legler's organization was just "a choice," most thought the fledgling arts center would honor the relationship that the city had forged with FTA, which helped keep the Bob Carr profitable for a quarter of a century. The new Dr. Phillips Center, after all, is a largely taxpayer-funded proposition, one that will be owned – at least as a building – by the city.

"DPAC's strategy to self-present Broadway is short-sighted," Legler wrote in an open letter to the community and municipal leaders on Jan. 7. "By taking on so much of the risk without a partner, they are not only putting the public tax dollars invested in the project at risk but jeopardizing the center's ability to achieve long-term financial stability."

DPAC's plan is reflective of other aspirational strategies used by the organization to promote its partially philanthropic endeavor during the last seven years, and it calls into question (once again) the viability of the center, which has seen its original mission – to "provide a venue for the performances of the Orlando Philharmonic, Orlando Ballet, Orlando Opera, Festival of Orchestras and Broadway performances in Orlando (or any of their successors)" – pared down to something almost unrecognizable. Two of the organizations that are named in that mission statement have folded, and the two that are left don't know where they fit into the equation anymore. As a result, DPAC – once the publicly lauded jewel in the crown of the $1.1 billion venues deal in 2007 – is starting to look more like just another questionable roadhouse for high-priced touring productions and concerts.

"When all of this first started, they kept calling it a 100-year building," Legler says. "It's a 100-year mistake."

According to numbers provided by DPAC, the group has raised $94 million in donations to date. In 2009, due to the faltering economy, the Dr. Phillips Center for the Performing Arts was bifurcated into two stages. The first stage – the 2,700-seat Disney Theater, meant to present Broadway offerings and touring concerts, along with the 300-seat Jim & Alexis Pugh Community Theater – is set to clock in at $335 million (as of October 2012, nearly $263 million had already been spent). The city, according to DPAC, has so far contributed $190.1 million, largely from bond issuances; the county has given $53 million toward stage one, with an additional $86 million to come when stage two – which will include a $165 million, 1,700-seat multi-form theater suited for the Orlando Philharmonic and the Orlando Ballet – commences. The county's contributions hinge on its tourist-development tax revenues.

How the project will be paid for is heavily weighted toward "civic engagement," prompting a fair amount of public scrutiny. In 2011, Orange County Mayor Teresa Jacobs publicly scoffed at a request from the city and DPAC for a $30 million bridge loan to keep the project going. She cited numerous flaws discovered in a county audit of the construction-bidding process and other operational concerns surrounding the project, including $1,000 car rentals for contractors, price markups, bad bidding processes and employee bonuses. "In summary, it appears at this time that this is a deeply flawed project from both a contractual and construction/design cost standpoint," Jacobs wrote in a letter to Orlando Mayor Buddy Dyer. "If the identified problems are not fixed and/or addressed now, the project cannot be built in all probability with any confidence that taxpayer money will be spent effectively and efficiently."

That "major problem," as Jacobs referred to it, was summarily addressed by the formation of an oversight committee, the Orlando Community Construction Corp., in March 2011 – it allowed representatives from Disney, the Orlando Magic and the county (among others) to shepherd the arts center through the process, and, to some degree, added an air of transparency to the DPAC board and staff's operating procedures.

But the keeping up of appearances – and relative silence – of DPAC since hasn't stopped the hemorrhaging on the financial side. A 2011 audit by accounting group Cross, Fernandez & Riley LLP shows a write-off of an uncollectable pledged donation of $7.5 million. And though DPAC initially agreed that it would have a $25 million endowment prior to opening, which is tentatively scheduled for fall of 2014, as of Dec. 31, 2011, the total endowment available was just $2.7 million, according to the audit. Somehow, DPAC still intends to bring its total donations up to $160 million by an unspecified date, according to a recent email, though some of the donations are tied to unspoken benchmarks from the donors. "The flow of the pledges depends on the details of the agreements made with each donor," DPAC spokeswoman Treva Marshall says in an email. About $6.5 million of the donations are tied to stage two of the development.

But even with all the shifting figures and apparent risks, the city claims that it is prepared for any eventualities. "There are clauses in the agreement that prevent the city from being involved with operational financial issues and mitigate risks to city taxpayers," city spokeswoman Heather Fagan writes in an email. "For example, there is a bankruptcy clause and a clause that states if DPAC is underwater for three years, they are in default of the agreement/contract with the city and the city can replace DPAC or change the operating entity. If that were to occur, the city would not inherit any expenses or debt held by DPAC because DPAC is a separate entity from the city."

For now, at least. After a series of delays and design troubles, the $473 million Adrienne Arsht Center for the Performing Arts, which opened in 2006 in Miami-Dade County, continues to be subsidized to the tune of $7.65 million annually for operations by the county (in addition to $3.8 million required to fix a leaking roof that sent 2,500 people running from a performance of The Lion King last May). And though DPAC likes to tout the fact that Tampa's Straz Center for the Arts is a successful self-presenting venue for Broadway tours, that's not exactly true. Last year, the Straz Center signed a presenting agreement with marquee Broadway presenters the Nederlander Organization of New York. DPAC has since hired Straz staffer

Judy Joseph as its vice president of programming.

For its part, DPAC seems optimistic about its prospects, regardless of dark prognostications. In a joint statement from board president Jim Pugh and executive committee member Chuck Steinmetz on Jan. 10, the group responded to the doubts over the project raised by the current Legler battle thusly: "We are pleased to acknowledge that the Dr. Phillips Center is on-time and on-budget. We are building a place which will have the ability to showcase various forms of performing arts for generations to come. We are creating new opportunities for the most important arts organizations, the Orlando Ballet and the Orlando Philharmonic Orchestra. By making these strong business decisions, we will ensure the Center's existence and effectively fulfill its vision – Arts for Every Life."

What those arts will be remains a mystery. Since the project's inception, two of the intended resident groups – the Orlando Opera and the Festival of Orchestras – have folded. The Orlando Ballet and the Orlando Philharmonic Orchestra are being used as selling points for fundraising purposes, but realistically, neither is suited to the stage one Disney Theater. That hasn't stopped DPAC from listing the struggling Orlando Ballet in its operating pro-forma as having 54 performances in the Disney Theater during the first year with a rental cost of $205,800. The rental rate for the new theater is $1.50 per seat, according to the pro-forma, which is nearly quadruple the 42-cent rate at Bob Carr. In an Orlando Sentinel profile last year, then-executive director of the Orlando Ballet, Mike Hough, spoke about a recovery for the ballet – which was for a time $500,000 in debt – and seemed excited about moving to the new center. Hough has since left the position after less than a year in office.

"As of yet, no final agreements have been made regarding our partnership with the Dr. Phillips Center for the Performing Arts," Orlando Ballet managing director Katherine Fabian writes in an email. "The Orlando Ballet looks forward to future conversations to ultimately define our relationship moving forward. We have not yet received information from DPAC regarding cost projections. Until we receive that information and have had time to analyze it, we will not be able to comment on the costs of transitioning to DPAC."

The Orlando Philharmonic Orchestra is not scheduled to perform in the new theater. There have been discussions throughout the process about how the orchestra would fit into the Disney Theater, but protest from the Phil's leadership prevailed. Instead, it's to remain in the Bob Carr, except for some special presentations. (The nonexistent Orlando Opera is scheduled for 21 performances in the Bob Carr, oddly.)

"When complete, the Philharmonic hopes and intends to perform in the Disney Hall annually for a special occasion or two, performing concerts that are appropriate for a non-acoustic, amplified hall," Orlando Philharmonic Orchestra executive director David Schillhammer writes in an email. "In order to accomplish that, great advance planning is required to identify and engage potential guest artists who will complement the orchestra in a hall not built for orchestral performances. In addition, these types of productions can be cost-prohibitive, so significant funds must be raised to implement these projects. The Philharmonic is committed to continuing its 20-year track record of balanced budgets."

Though the Philharmonic seemed excited to launch its long-delayed "20/20 Vision" fundraising plan after a $750,000 donation last February, Schillhammer says that things are still "difficult" and that the donation drive remains on the back burner. He's still waiting for the promised new residence he's been expecting since 2007, when DPAC was first announced.

"While DPAC is securing funding for the 1,700-seat acoustic hall, the Philharmonic is working with DPAC and the city to ensure Bob Carr remains open, so the Philharmonic may continue to perform its highly popular Super Series there, until such time as the dream for an acoustic hall is being realized."

The city says it will keep the Bob Carr open until the opening of DPAC's stage two. But that doesn't mean things will stay the same. As part of the performing arts center agreement, DPAC is supposed to take over ticketing for the old hall (at an undetermined time, according to the city) and also retain first right of refusal on touring shows. That presents a conundrum involving leverage and competition, financially speaking. When asked to elaborate how the new paradigm will work, DPAC remains unclear.

"We have had discussions with the ballet and the philharmonic regarding their use of the theaters (either Disney and/or the Bob Carr). The decision is up to the arts groups," DPAC spokeswoman Treva Marshall writes. "A pro-forma rental rate had been set, but this will need to be verified through the budgeting process in cooperation with the resident organizations."

Newly hired vice president of operations Ellery Brown – who is a 25-year veteran of performing arts centers from California – doesn't elaborate when pressed, except to say that things are still flexible.

"We have planned rental subsidies for the resident organizations as they transition into the new spaces, so the way the pro-forma works is there are proposed rental rates that would be part of the designated spaces," he says. "We are currently thinking about how much we would allocate to help with the transition." The latest operating pro-forma submitted to the city suggests only a 5 percent subsidy for arts groups using the Disney Theater.

None of this is going to help Ron Legler and the Florida Theatrical Association. After spending four months and $100,000 on a bid to present at the new performing arts center, the group was briskly denied. DPAC confirms that FTA was the only respondent to their request for proposals specifically related to Broadway presentations, but adds that it reserved the right to refuse any bid and, even so, FTA did not include financial audits that DPAC requested. That's an unnecessary formality, Legler says.

"Our company has never accepted any donations: any state money, any federal money, any local money," he says. "We leave that for the ballet and the philharmonic and the people that are local here. We have a tax auditor that prepares our 1099. We go through every rigorous thing that you need for a nonprofit. We don't feel the need to go through and audit for $15,000 a year, because we don't accept any donations."

In building its case for the contract, FTA pointed out that it successfully entertained an average of 420,000 theatergoers a year, maintained a strong subscription base (8,500 season-ticket holders) and was a good community steward, awarding more than $1.5 million in local scholarships. Along with extensive financial statements are recommendations for a 50 percent profit-share model with DPAC and several options for an annual presenting plan that could net DPAC between $1.5 million and $2 million over the period. That would apparently not be enough. DPAC's board had a "retreat" and decided to deny the bid, DPAC says in an email.

But DPAC's own operating pro-forma, the most recent of which was submitted to the city on Nov. 12, illuminates some curiosities of its own, says Legler. The group is projecting a 12-week Broadway season, instead of the standard eight-week run. DPAC doesn't consider the possibility of competition, something that is likely considering FTA's insistence on remaining in the market. There are no projected losses. DPAC will pay itself a rental fee. Moreover, DPAC is relying on projections that 70 percent of its revenues will come from a Broadway series to which it has no subscribers. Though the DPAC board continues to publicly insist that the building alone will be draw enough, Legler disagrees.

"When you go to a movie theater, you don't really consider that the movie theater is brand-new or not," he says. "I don't just go to the movie theater because it's beautiful and pick out the movie I want to see. The Broadway industry is not built on buildings. The Broadway industry is built on product."

And that product could be scarce for DPAC. At the APAP convention, Legler says the signs of a tough economy were dragging down the market; there just aren't any blockbusters on the horizon for the 2014 season. And even if there were – Legler won't reveal which shows he's picked – Florida Theatrical would hold exclusivity rights to the production anywhere within a 75-mile radius. Tampa could get the new Phantom of the Opera reboot, but DPAC couldn't, not as long as FTA had contracted with the show. And shows like Wicked and The Lion King won't be coming back this way for at least four years, he says. He hates that he's gone from "collaborator to competitor," and even though he hints that Ramsberger and Pugh tried to lure him away from his organization (there was a lunch, he reveals, but not much else), Legler didn't bite because "the first one up the hill is usually the first one shot." Now, DPAC is running a public relations campaign to discredit Legler and FTA's attachment to national powerhouse Broadway Across America, which controls 70 percent of the national touring market.

"FTA is a nonprofit organization representing a New York company in venues throughout Florida," DPAC wrote in an internal "talking points" email to its board around Dec. 21. "Knowing its strong ties in the local arts community, we have reached out to Ron Legler to explore a possible local relationship."

In fact, the group did reach out, according to emails provided by Legler. Except DPAC doesn't want to meet with Legler's parent organization, a point that Ramsberger restates in each back-and-forth. Even Orlando Mayor Buddy Dyer has reached out to try to bridge the divide, but, according to city spokeswoman Heather Fagan, neither side was willing to budge.

"I want to be clear that the city not being involved with the decision-making doesn't mean that the city isn't watching and providing input and encouraging prudent decision-making," Fagan writes in an email. "Mayor Dyer says this is not the decision he would have made. His approach would have been to limit the risk associated with opening the building by using a known partner to present the Broadway [shows]."

After weeks of speculation about just where FTA might land in Orlando – especially considering Legler's New York visit to the APAP conference in New York in the interest of programming the company's 2014-2015 season – Legler now says that the group has its sights set on the Linda Chapin Theater out at the Orange County Convention Center. Which, in and of itself, is a heavy dose of civic irony. Former Orange County Mayor Linda Chapin sits on the DPAC board. Also, the county – which has been critical of the performing arts center ordeal – receives the profits from the convention center. (Orange County Convention Center executive director Kathie Canning confirms that she and Legler are "discussing options," adding that DPAC has "called about options," as well.) For now, Legler says he's happy about the prospect of gathering architects and designers to get the proposed new 2,600-seat space at the convention center ready.

"I feel like I'm going to wake up and this is some really horrific seven-year dream," Legler says. "I was with DPAC and I feel like I was not even in my own body. I've been a part of getting the place built, I got the shows, and now I'm not going to have access to the building because of five people [on the DPAC board]. One of the people who voted against us, her name is on the theater that I'm going to present in."

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