Annapolis aldermen may ask First Night to pay for services

March 28, 1994|By Liz Atwood | Liz Atwood,Sun Staff Writer

The organizers of First Night Annapolis describe their New Year's Eve celebration as a night "when the city becomes a stage." Now, some City Council members are saying its time for First Night to pay the stage hands.

"They need to cover the cost of their expenses," said Alderman Theresa DeGraff, a Republican representing Ward 7.

"When you look at the fact that they've turned a profit, there's no reason the city shouldn't benefit," said Carl O. Snowden, a Democrat from Ward 5.

The performing arts event costs city taxpayers about $12,000, mostly for police, fire and bus service. First Night ended its last fiscal year with a reserve fund of nearly $205,000, according to an audit dated May 28.

Mr. Snowden, chairman of the City Council's Economic Matters Committee, has promised to look more carefully at the city's business practices, an inspection that could end the city's donation of services to First Night.

"There is overriding sentiment on the council that they be required to pay something," he said.

But Elizabeth Welch, one of First Night's directors, said requiring the nonprofit organization to pay for city services would create a financial hardship. More important, she said, it would send a signal that the city does not support the event and would make it difficult to attract other contributors and sponsors.

"If the city pulls out funding for First Night, it pulls out funding for the arts in a major way," Ms. Welch said.

Alderman Ellen O. Moyer, a Democrat from Ward 8 and head of the City Council's Finance Committee, argues that the city's money is well spent by providing nonalcoholic, family entertainment at New Year. "I think we get a good deal," she said.

But critics point out that First Night has a paid staff, and each year banks a surplus of money. "It's no different than the boat show," said Ms. DeGraff.

The annual boat shows, produced by Annapolis Boat Shows Inc., are for-profit events. Organizers pay the city rent for the City Dock where the event is held.

Lana Nelson, the other First Night director, said the event differs from the boat show because of its nonprofit status, recognized by the Internal Revenue Service and by the Maryland secretary of state. First Night organizers are required to file detailed financial reports each year.

The most recent filing, which reflects the 1992-1993 fiscal year, shows that First Night collected $303,000 from sponsors, grants, contributors, admissions and souvenir sales. The cost of putting on the 1992 New Year celebration was $212,941, including $58,800 in administrative costs and $24,713 to pay for a secretary.

The balance went into a reserve fund that totaled $204,758 on March 31, 1993, when the organization's fiscal year ended.

City Council members say the fund is evidence that First Night has the ability to pay the city. First Night officials respond that the fund is needed to offset costs if they have a bad year.

"It is very important that we be fiscally responsible," Ms. Nelson said.

Zeren Earls, president of the International Alliance of First Night Celebrations in Boston, advises First Night organizations to keep a reserve fund that will cover the cost of one year's production in case of bad weather.

When First Nights are unable to keep such a balance, they can quickly run into trouble, she said.

A First Night celebration in Stamford, Conn., ran a deficit and folded after only a few years, she said. One problem in Stamford, was that the city charged for police protection, Ms. Earls said.

"This is a huge undertaking for a private enterprise, and it needs to have city hall support," she said.

Of the 105 First Night celebrations in the United States and Canada, fewer than 10 reimburse their cities for services, Ms. Earls said. In some cases, the cities provide grant money in addition to in-kind services, she said.

Chris Eure, executive director of First Night Virginia in Charlottesville, Va., said city officials there have discussed charging the event. Meanwhile, First Night Virginia has been contemplating whether to ask Charlottesville for a monetary donation in addition to in-kind services.

Ms. Welch said that Annapolis should be willing to support First Night because it provides safe, alcohol-free New Year's Eve entertainment, is a showcase for area artists, and draws crowds that help downtown businesses.

She and Ms. Nelson, both Annapolis residents, founded First Night Annapolis after hearing about it in other cities.

They persuaded Mayor Alfred A. Hopkins to be the honorary chairman and recruited Gov. William Donald Schaefer, Comptroller Louis L. Goldstein and state Sen. Gerald W. Winegrad to serve as honorary board members.

The first year, they offered 83 performances by 27 artists or groups and drew a crowd of 8,000.

On New Year's Eve 1993, the event featured more than 350 performances by 75 groups. Approximately 14,000 admission buttons were sold.

Webster Chamberlin, a member of the First Night Annapolis Board of Directors and owner of the Cafe Northwest coffee shop, said he met his business partner at a First Night celebration. They went on to establish Cafe Northwest, which Mr. Chamberlin noted is packed with customers on New Year's Eve.

"It's an opportunity for small businesses to prosper," he said.

John Prehn, owner of the Magnolia House bed and breakfast, said that until First Night Annapolis started, the bed and breakfast inns in the city were empty on New Year's Eve.

"Now the bed and breakfasts are completely filled," he said.

Ms. Welch and Ms. Nelson said they are a bit dismayed that members of the City Council want them to pay the city's costs. "The return on the investment is solid," Ms. Welch said. "The public benefits, and the city benefits."

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