PRC cuts amount of cash expected from sponsorship
It’s no longer fantasy world on the Santa Monica Pier when it comes to finances.
The Pier Restoration Corp., which oversees the pier, tweaked its budget last month to make its revenue projections a bit more realistic.
Up until this year, the PRC had budgeted about $100,000 in projected sponsorship revenue annually, but it never came close to hitting the goal, said board member Abby Arnold.
So this year, the PRC decided to be more cautious and projected $30,000 in sponsorship revenue.
“We felt that we should be more prudent this year,” she said, adding the PRC’s focus for the past five years has been to lure large corporate sponsors on the pier. But the effort hasn’t paid off, Arnold said.
Arnold added that because the PRC was unrealistic in thinking it could attract that much money in sponsorships in past years, many items like marketing brochures and a Web site redesign were routinely put on hold. Board members thought the PRC would collect more than it did and every year there would be a shortfall.
The PRC’s adopted budget also reflects a shift in staffing patterns and priorities. Instead of using a highly paid staff person to attract corporate sponsorships, the PRC voted to spend the estimated $70,000 annual salary toward a staff member who will focus on more community-based, local events and co-sponsoring of local businesses.
The PRC also eliminated a public relations position that cost about $32,000 a year. Instead, a part-time person will focus on local promotions.
The PRC’s expected revenue this year is more than $600,00, which includes a $467,200 subsidy from the city of Santa Monica. The rest comes from sponsorships, special events, promotions and filming.
The largest expense for the PRC is the summer-long Twilight Dance Series, which costs $170,000 annually. Other big ticket items for the PRC are its salaries and marketing, which cost about $88,000 annually; $46,000 on operations and another $67,000 on professional services.
While the PRC comes close to making its budget every year, there are some factors this year that have increased its costs. The PRC’s insurance has gone up considerably because it is involved in $50 million lawsuit.
Naia Sheffield is suing the PRC and the city for breach of contract. She claims her restaurant, the Boathouse, was kicked off the pier unfairly.
The suit alleges that the city and the PRC, which handles leases on the pier, reneged on a 25-year lease Sheffield negotiated in 1993.
She sued the PRC in federal court, but the suit was dismissed because the statute of limitations had run out.
The city, which owns the pier, ended its month-month lease with the Boathouse last July to make way for movie-themed chain restaurant Bubba Gump Shrimp.
PRC Chairman Michael Klein said when the insurance policy ended this month, the board had trouble finding another insurance carrier to cover the PRC because of the lawsuits. The board did eventually get a policy signed, but at a significantly higher cost.
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Originally published in the Santa Monica Daily Press print edition on June 1, 2002. Read the original PDF.