The Arts Garage matter
“This is not some kind of runaway insanity run by a crazy Russian.”
So says Alyona Aleksandra Ushe, president, CEO and self-proclaimed “czarina” of Arts Garage (above), defending the non-profit cultural organization that has become a creative success in Delray Beach using space in Pineapple Grove leased from the city. That lease expires March 15.
Nobody on the city commission wants to see Arts Garage depart, especially after the loss of Artists Alley. Mayor Cary Glickstein calls Arts Garage “a good fit.” According to the organization, more 75 percent of its patrons come from outside Delray, the largest percentage coming from Boca Raton. Those visitors help Delray Beach’s economy.
Arts Garage also is diversifying. The group is offering the play “Reborning” in a new, smaller venue separate from the larger main room, where patrons can eat and drink as they watch the performance. (The Puppetry Arts Center formerly used the space.) There’s a new gallery for local artists. Arts Garage’s performances have received increasing critical praise.
But there remains the lease issue. In 2013, the newly elected Glickstein and Commissioner Shelly Petrolia successfully pushed to lease the 10,000 square feet to Arts Garage rather than sell it to a law firm or divide it between Arts Garage and the firm. The commission, however, conditioned the lease on Arts Garage raising $2.5 million to buy the space. The law firm had offered that amount. Arts Garage pays just $800 per month for the space.
In fact, Arts Garage has raised no money. And there’s a new problem.
At its Jan. 28 meeting, the Community Redevelopment Agency, which reimburses the group for programming and arts education, withheld a $68,000 payment to Arts Garage for the final quarter of the 2015 fiscal year. The board held back the money because the group has not provided its latest financial report and missed a deadline to ask for an extension. Because of the delay, the CRA and Arts Garage have not agreed to a payment agreement for this year. The agency’s contribution for last year was nearly $300,000.
On Jan. 15, Creative City Collaborative (CCC)—the parent organization of Arts Garage and its counterpart in Pompano Beach—asked Delray Beach for a 10-year lease extension with a new option to buy. The letter predicted that 2016 would be “the best year yet for Arts Garage.” City Manager Don Cooper will “provide a report” at next Tuesday’s commission meeting. “Once the commission has that information,” Cooper said in an email, “they need to provide direction whether they want to negotiate a new lease with the CCC or some other course of action.”
At this point, Arts Garage and the city sound like a couple talking past each other. Arts Garage emphasizes its creative accomplishments and rapid rise. Ushe wants the city —“our partners”—to be “realistic.”
The commission and the CRA, however, want to talk money and management. The commission was unhappy that CCC expanded into Pompano without first asking the city. Ushe said the board approved the move after Pompano Beach asked groups to submit proposals. More recently, the commission was unhappy that CCC didn’t reach out before discussing a partnership with a tech start-up. The commission also believes that CCC should have given much earlier notice that the campaign to raise the $2.5 million would not succeed.
Last week, I spoke with Ushe and board vice chairman Brian Rosen. They argued that programming and equipment had been more urgent fund-raising priorities, and that delay in obtaining a contract from the city left just two years to raise the $2.5 million. “Very ambitious,” Rosen called it. CCC is “still trying to find the ‘whale’”— a large donor. Rosen said the board shifted its fund-raising focus and alerted commissioners that it wouldn’t have the money to buy the space.
Ushe and Rosen note that Arts Garage has increased its budget from roughly $300,000 to about $1.5 million. Expanding to Pompano Beach in 2014, Ushe said, “opens an enormous amount of doors.” She means programming contacts and donors. On the first, maybe, but it’s hard to see how an operation in Pompano Beach would make people in Delray more willing philanthropists.
Regarding the CRA, Rosen said the agency “kind of switched,” first asking to see Arts Garage’s first audit—for the 2013-14 fiscal year—and then the last financial report for 2015. Whatever the confusion, though, Rosen acknowledges that Arts Garage missed the deadline.
The CRA board, though, also focused on a management letter that accompanied the 2013-14 audit, the group’s first. Rosen said the letter identified 10 “weaknesses.” Ushe broke in to call them “challenges.” That distinction is telling.
Ushe wants the city to focus on how far Arts Garage has come. She wants the city still to treat the group as a plucky upstart. Ushe and Rosen stress that Arts Garage came out “clean” in the audit. Ushe said it showed no “co-mingling,” meaning that money from Delray Beach went to Delray, not to Pompano Beach. Arts Garage provided me a list of employees and their salaries, divided between work in Delray and work in Pompano.
The city and the CRA, though, want Arts Garage to act more like an established organization, one that Ushe acknowledges wouldn’t exist in its current state without that lease deal three years ago. As the city sees it, an established organization keeps up-to-date financial records and promptly fixes any “weaknesses.” Examples: the audit’s management letter found no evidence that Ushe had reviewed credit card purchases, and it also questioned documentation of expenses.
These dueling perspectives will be evident when the commission discusses Arts Garage’s future. Arts Garage is asking for a lot, even if Ushe contends that some non-profits lease city space for $1 a year. Several questions present themselves:
Given Arts Garage’s growth, should Ushe still should handle both creative and management responsibilities? Can Arts Garage show persuasively that it could raise the money in 10 years and not leave the city in the same place after another decade? How much should Arts Garage consult with Delray Beach on key decisions?
Still another question may involve the Arts Garage board. Ideally, board members should have no other business before the city. Yet the board chairman is Steve Michael, chairman of Hudson Holdings, which wants to build Swinton Commons. Ushe has publicly advocated for the project, which drew strong criticism last week from the Historic Preservation Board. Ushe’s advocacy risks linking Arts Garage with a potentially controversial project.
Ushe resists the idea that Arts Garage and Old School Square could merge. “We need our independence.” Ushe and Rosen offered no “course of action” beyond the lease extension. If nothing changes before the March commission meeting, Arts Garage may want to offer specifics about financial reporting and to show up with a new audit verifying that it has addressed those “weaknesses.”
CRA Director Jeff Costello said, “Hopefully, we get this resolved soon.” No one in the city wants to run off Arts Garage, yet public assets are at stake.
Petrolia said, “There are good points on both sides.” Arts Garage’s best selling point is its success. Ushe and Rosen are correct that stability would enhance that success. But since success depends on the city’s continued cooperation, Arts Garage must show that management, not just programming, will have a starring role.
Follow-up on 327 Royal Palm
As predicted, the Boca Raton City Council met quickly and effectively in its special meeting last Thursday as the Community Redevelopment Agency.
The council let City Manager Leif Ahnell know that he could belatedly issue a permit for 327 Royal Palm, the 25-unit downtown condo project. Ahnell said he would so, thus likely heading off a lawsuit by the developer. Also, the council told Ahnell that could issue any similar permits for projects that clearly meet downtown requirements for open space. Meanwhile, the city’s review of previous projects approved under Amendment 4035 continues.
I reported last week that council members Mike Mullaugh, Jeremy Rodgers and Robert Weinroth had called the meeting after Scott Singer—the CRA chairman—had declined to call it. The CRA had a regular meeting on Monday. In an emailed response, Singer said, “I asked for more information before the extraordinary step of a special meeting, and before it was received, I learned that three other members wanted to proceed.”
