Archived decisions

Hampshire County Council

Proposal to invest in Cricklade Theatre, "The Lights", Andover Item 2

Executive Member, Recreation and Heritage

18 May 2006

Executive Member, Children's Services

25 May 2006

Executive Member, Policy and Resources

16 June 2006

Joint report by the Directors of Recreation and Heritage and Children's Services

Contact: Nicola Horsey Ext: 5423 and Stuart Dorward Ext: 6110

1. Introduction

1.1 In 2005 Test Valley Borough Council (TVBC) agreed to buy Cricklade Theatre from Cricklade College. The Borough Council will be spending £1.9m on purchasing the property and then making substantial changes and improvements to it to bring the theatre into the 21^st century. The aim is to open a self-contained community facility and the theatre, which is now going to be called "The Lights", by the end of 2006. The County Council has been engaged, particularly during the last four years, in a close partnership with TVBC around working with young people and using culture as a vehicle for the regeneration of Andover town centre.

1.2 TVBC have asked the County Council to jointly fund the revenue costs of The Lights. The County Council has responded that it would do so, up to a total annual cost of £120,000, subject to agreeing a robust business plan for the venue. A senior member of staff from the Arts Service was seconded to TVBC during most of 2005 to develop the business plan.

1.3 This report summarises the business plan (which covers the first three years of operation) and identifies the County Council's main interests in The Lights. It recommends that partnership funding of £100,000 in 2006/07, increasing to £120,000 in 2007/08 and 2008/09, is given to TVBC towards the running costs of The Lights. In principle, this would be extended for a further three years subject to satisfactory performance against County Council objectives and the approval of a new business plan. The County Council is an integral partner in this initiative and reports outlining the progress of this project against County Council objectives will be made annually to Members.

2. Background

2.1 Cricklade Theatre was built in 1974 as part of Cricklade College with 1900m² of space in a theatre, various rooms and a café area. It was run by the College as a performing venue with a programme for work by both professional and amateur performers. This included theatre, popular and classical music, children's shows, comedy and entertainment. The theatre was closed by the College in 2004 due to funding and organisational issues within the College.

2.2 After the theatre closed there was a sustained public campaign to save it. As stated in 1.1, the theatre was then bought by TVBC for £400,000 as part of its vision to stimulate local arts and creative industries in Andover as a way of attracting inward investment.

2.3 In early 2005 TVBC made the County Council aware of their intentions to purchase Cricklade Theatre and transform it into a multi-purpose facility for the people of Andover, when the negotiations with Cricklade College were just beginning. This fitted in well with the County Council's aspirations for Andover too, which included plans for a Discovery Centre, working with organisations such as Testway Housing to develop cultural and sporting activities for young people and generally improving community and cultural facilities in Andover. The County Council had also identified Andover as one of its priority areas of activity due to the relatively high levels of economic deprivation in parts of the town.

2.4 Andover, with a population of 40,000 and plans for this to increase substantially over the next 20 years, has no venue for professional performances and few possibilities for young people to take part in arts and out of school education based activities. The neighbouring cities of Winchester and Salisbury are a similar size to Andover, yet Winchester sustains two performing venues and there are three in Salisbury. Other factors that point to the potential for a venue in Andover are the high employment rate, the large number of small to medium sized businesses based in the town and a significant student population.

3. Current Situation

3.1 Having bought the Cricklade Theatre, TVBC quickly began to work on its refurbishment. A Project Board was set up consisting of the Leader, Deputy Leader and a Corporate Director of TVBC, the Theatre's Project Manager (TVBC Head of Service) and the County Council's Head of Arts and Tourism. This has met three times to date.

3.2 A project team have been taken on to design and refurbish the building and the County Council's Corporate Graphics team won the contract to develop the design of the promotional materials, website etc. Work has started on site and involves:

· A high quality finish throughout the building using a contemporary style, incorporating strong colours and innovative use of lighting to transform the building from a drab and run down 1970s facility;

· Special acoustic treatment in the hall;

· Replacing the seats in the theatre with new, more comfortable seats with more leg room;

· The creation of a large pyramid roof light in the hall to overcome the relatively low ceiling and provide natural light and ventilation;

· Providing a decking area at the front with an extensive canopy to transform the external appearance of the building; (see page 6)

· Larger stage doors and upgraded changing areas - both arising from consultation with local groups;

· Special signposting of the pedestrian route to The Lights from the town centre;

All this is designed to make the venue an attractive, lively, customer friendly facility which particularly welcomes young people.

3.3 TVBC are investing £1,500,000 in this extensive refurbishment programme. The plan on the page 5 shows the proposed layout of The Lights and the design of new decking and canopy area outside the front entrance is shown on page 6.

3.4 When completed, The Lights will comprise:-

· A 231 seat theatre;

· A separate hall suitable for gigs for up to 500 young people, and dances for up to 200 people; the hall also includes a bar and café area;

· Two multi-purpose function rooms for dance, arts classes and workshops;

· Three meeting rooms primarily aimed at attracting meetings, conferences and training events from local businesses and community organisations;

· Offices/storage etc.

4. Business Plan for The Lights

4.1 The business plan for The Lights envisages five main income streams which relate to:-

i) Theatre iv) Conference and Room Hire

ii) Hall v) Bar and Catering

iii) Education and Outreach

i) Theatre

4.2 It is proposed that the theatre provides a balanced programme of professional

performances in music, theatre, dance, literature for adults, young people and children with 50-60 performances a year. The aim is to break even over the first three years, with ticket prices ranging from £6 to £30 and assuming an average 100 attendance per performance, 45% of capacity. This figure is commensurate with national figures from Arts Council England for theatre attendances in similar environments.

4.3 Based on the experience of our art centres and various independent arts venues, the proposed break even scenario for the theatre seems realistic. We would hope that, after the first three years, the theatre would contribute to fixed costs which could be used to fund repairs, improvements to the lighting and so on.

ii) Hall

4.4 The hall is a large and potentially flexible space. It will have the capacity to do many things (community meetings/AGMs for 200 people, rock gigs, sales, blues events for 500 people, large participatory events for 50 people, dinner or tea dances for 250 people etc). However, the availability of the hall will be constrained by the fact that it is also the bar area for theatre shows and it contains the café area, which will be used during the day.

4.5 This means that the amount of programmable time for the hall will be limited. The business plan concentrates on developing the gigs programme, mainly because the market for dinner/tea dances etc is uncertain. Andover has no comparable large venue for rock gigs and the available evidence suggests that the market is potentially large.

4.6 Gigs usually make their money through the bar (which is dealt with in v) below) and the business plan suggests no more than one gig a month to start off with, with a contribution of £1.00 per head. This results in £6,200 contribution to running costs in Year Two, increasing to £7,500 contribution in Year Three.

4.7 Again, these seem reasonable assumptions.

iii) Education and Outreach

4.8 The aim of The Lights' education and outreach programme is to develop a sustainable range of educational opportunities for young people and adults within the venue and a thriving programme of outreach projects throughout Andover. These will be aimed at people who are normally hard to reach (building on existing work and links), including young people and adults on estates, young people in care or in special education, disabled communities including Enham and others who may not easily access the resources and facilities of The Lights. Recognising the importance of the education and outreach work, TVBC will be deploying their Arts Development Officer to The Lights to undertake outreach work.

4.9 Currently the business plan is proposing that an additional part time Education Officer is appointed in Year Two with a budget of £10,000 in Years One and Two, reducing to £4,000 in Year Three (when it is expected that the programmes will start to attract additional external funding). Over time this part time post could become full time with additional funding from elsewhere. Arts Council, South East and our own Creative Hampshire project are in discussions to support this important aspect of work.

4.10 Within The Lights, the business plan suggests a programme of regular classes which would be enhanced by a range of one-off workshops, work experience opportunities, training courses and so on. The Lights will also run a large and wide range of activities for young people as illustrated in the table below:-

4.11 As far as classes and workshops are concerned, the business plan assumes 11 weekly classes for adults and seven for children/young people, running over three terms (30 weeks) with an average of ten participants per class. In addition, the business plan proposes a further 18 one-off classes, lasting a day each for an average of ten people per class. By Year Three the average number of people in all the classes is assumed to increase to 15.

4.12 The business plan shows the contribution to the overall running costs of The Lights on the classes of £7,400 in Year One, increasing to £21,600 in Year Three.

4.13 The business plan is less specific about the proposed outreach work. It acknowledges the work previously undertaken in Andover by TVBC's Arts Development Officer (now The Lights' Education and Outreach Officer) and the County Council's Youth Arts Officer. Both officers have worked with young people at risk and in partnership with housing and community associations; they now need to work together to develop an extensive outreach programme from The Lights.

4.14 Arguably the County Council's greatest interest in The Lights is the education and outreach work. The Lights is perfectly placed to offer a range of education and training activities and experiences for young people, based on the existing arts education outreach currently being undertaken in and around Andover and which fits in well with the objectives of Recreation and Heritage and Children's Services.

4.15 The proposed programme of classes and education activities for young people within The Lights is sound and realistic; it is the outreach programme that needs to be developed. We are very encouraged by TVBC's commitment to this aspect of the work of The Lights by deploying an officer to fulfil this role. What we need now is for this officer, our Youth Arts Officer and the new Director of The Lights to:

· Develop a framework for the creation of a programme of mainstream and specialised outreach activity for 2006/07, with suggested outputs - July 2006;

· The outreach programme needs to be explicit about target audiences, identify budgets and lead officer responsibility;

· Show how The Lights can encourage music making and the opportunities for local bands to develop;

· Link into other community based projects, identifying who is leading on them.

In essence, the Outreach Programme needs to illustrate how The Lights will add value to what is already being done in Andover and it is this area of work the County Council will be particularly interested in.

4.16 The Outreach Programme will be agreed by TVBC and the County Council in July 2006 and the business plan will be adjusted to reflect this programme. It is anticipated that up to £40,000 of the County Council's 2006/07 grant to The Lights is used to support the Outreach Programme.

iv) Conference and Room Hire

4.17 Whilst the business plan was being developed during the latter part of 2005, research was undertaken with Andover's business community to gauge the potential interest of using The Lights as a venue for meetings, training sessions etc. The research indicated that 20% of businesses may be interested in hiring meeting space at The Lights, but the lack of on-site free car parking and the on-going use of The Lights for other reasons may well put many businesses off.

4.18 However, the local arts and community groups have shown a strong interest in using the theatre and meeting rooms at The Lights. Cricklade College have also indicated a strong desire to use the theatre for their students, too, on a regular basis.

4.19 The business plan suggests two hire rates, one for community and non-profit making organisations and higher rates for commercial businesses and shows a contribution from hirings of £22,300 in Year One, rising to £27,600 in Year Three.

4.20 Our view is that the majority of income from hirings will come from the community and non-profit making organisations, rather than from local businesses which normally expect standards similar to a 3-4 star hotel. We want The Lights to be a bustling and busy multi-purpose facility, with people coming and going all the time.

4.21 The assumptions made in the business plan for the amount of meeting/function room/theatre hires seem realistic and this part of the business will be an important income stream for The Lights. It is important that the right balance is struck between levying realistic charges but ensuring that the facility is inclusive and available for the whole community. Because of the relative uncertainty over the market for these facilities the accommodation is being planned in a flexible way to allow adaptation to alternative uses (e.g. to allow expansion of the education programme) if this proves to be necessary.

v) Bar and Catering

4.22 The bar is an important service for any venue like The Lights to offer and it is also a significant source of revenue, particularly with large gig events. The business plan assumes different average limits of spend per person, depending on the event. These range from £3.50 per person attending a gig to £2.00 per person hiring a meeting room or the theatre. The business plan shows a profit on sales at the bar of £24,700 in Year One, rising to £31,500 in Year Three - staff costs are not included.

4.23 The business plan proposes that catering is franchised out at a peppercorn rent, thereby allowing the contractor to make a profit which hopefully would mean The Lights would have a sustainable catering service. The caterer would operate the coffee shop during the daytime. Catering for evening events, such as dinner dances, would be undertaken by the selected caterers whom the hirers would chose themselves.

4.24 Our experience of running bars in other venues suggests that the projections in the business plan are realistic. But we would like the staff and other bar specific costs to be added into expenditure to show the true contribution of this potentially valuable income stream to the venue.

4.25 We agree that, because of all the problems historically associated with in-house catering operations, that it is sensible to contract the catering out and not expect it to be an income stream to The Lights.

5. Other aspects of the Business Plan

5.1 The business plan proposes that a relatively small team of five full time staff are employed to run The Lights, supplemented by a number of part time staff and casual workers. As the business grows the hours of the part-timers can be extended and the number of casual workers increased. Staff costs will cost £217,000 in Year One, rising to £234,000 in Year Two. See Appendix 1 for the staffing structure.

5.2 TVBC recently advertised the post of Director and the interviews for this important post were held on 3 April 2006. The County Council's Head of Arts and Tourism was on the interview panel with TVBC and the new Director takes up the post on 5 June 2006.

5.3 The main elements of a marketing plan are included in the business plan, along with a budget of £25,000 in Year One, rising to £27,000 in Year Three.

5.4 The detailed budget for The Lights is enclosed as Appendix 2. The County Council's contribution to The Lights is shown as £120,000 in Year One, £123,000 in Year Two and £127,000 in Year Three, i.e. allowing for a 3% increase per year for inflation.

5.5 The staffing structure seems fine in principle. We would like the venue Director to have a say in the precise structure she requires which may mean the structure changes, so long as the total costs do not increase - TVBC are comfortable with this.

5.6 The framework for the marketing plan is fine, but a full Audience Development and Marketing Plan needs to be produced when the Director and artistic policy have been established. This needs to be one of the Director's first priorities.

5.7 The County Council's contribution for 2006/07 (Year 1) will be £100,000 because The Lights will not be opening and fully operational until about October 2006 and will therefore not incur a full year's running costs. For the following two years our contribution will be at £120,000 per annum.

5.8 If The Lights significantly exceeds the income targets, as set out in the Business Plan, over and above any corresponding increase in costs, then the County Council needs to reserve the right to reduce its financial contribution accordingly the following financial year.

6. Governance arrangements

6.1 Governance arrangements have still to be finalised with TVBC but we would anticipate the existing Project Board would continue (Leader, Deputy Leader and Corporate Services Director and Head of Leisure Services from TVBC, Senior HCC Recreation and Heritage officer) under a different name, with the addition of a Member from the County Council too. This group would act as a consultative body and would need to, amongst other things, review the accounts of The Lights.

7. Financial Implications

7.1 The County Council contribution of £100,000 in 2006/07, £120,000 in 2007/08 and a further £120,000 in 2008/09 will be made up equally from the existing budgets of Children's Services, Recreation and Heritage and Policy and Resources, i.e. £33,333 per budget in 2006/07 and £40,000 per budget in 2007/08 and 2008/09. TVBC are investing a further £202,300 per annum as revenue funding.

8. Legal Implications

8.1 The County Council is able to utilise broad powers under the Local Government Act 1972 to provide financial support for the arts. In particular, Section 145 of the Act enables the Council to contribute towards the expenses of doing anything necessary or expedient for any of a number of purposes, including the provision of entertainment of any nature, or the provision of a theatre, concert hall, dance hall or other premises suitable for entertainment. The powers include the ability to contribute towards the development and improvement of the knowledge, understanding and practice of the arts.

9. Impact Assessment

9.1 The Lights has huge potential to get involved with the whole community of Andover, especially those in areas of deprivation. Particular focus will be on young people, including those at risk from exclusion and those that have already been excluded from school.

10. Links to Corporate Aims

10.1 The County Council's proposed involvement with The Lights fits directly in with the Corporate Strategy's Aim 1 (Maximising life opportunities), Aim 4 (Building strong and safe communities) and Aim 5 (Improving services) by providing a new and vibrant cultural facility in Andover with an extensive outreach programme which will involve local communities in and around the town.

11. Local Member Consultation

11.1 Councillors Kirk, West, Perry and Woodhall have all been involved at different stages of the project and are supportive of its aims.

12. Conclusion

12.1 The County Council has long been aware of the lack of cultural facilities and provision for young people in Andover. It has sought to rectify this, at least to some extent, via the valuable outreach work of the Youth Arts Officer and others, too, but there is obviously a limit to what they can do. Recently the County Council has designated Andover as one of its priority areas and so, when the chance came to work with TVBC to transform the old and empty Cricklade Theatre into a busy and exciting cultural venue, the County Council jumped at the opportunity.

12.2 The business plan for The Lights demonstrates that it can and should be a successful venue for everyone in Andover, but particularly for young people. It is recommended that the County Council supports The Lights with an annual grant for £120,000, with certain conditions, as set out below.

Recommendations

It is therefore recommended that:-

i) The Executive Member for Recreation and Heritage approves the business plan for The Lights and agrees to provide revenue funding for three years, starting in 2006/07.

ii) The revenue funding will be £100,000 for 2006/07, £120,000 in 2007/08 and again in 2008/09. This will be made up equally from the existing budgets of Children's Services, Recreation and Heritage and Policy and Resources.

iii) This is the full extent of the County Council's funding.

iv) Up to £40,000 of the County Council's £100,000 grant for 2006/07 will be used to support the Outreach Programme.

v) If The Lights significantly exceeds the income targets, over and above any corresponding increase in costs, then the County Council reserves the right to reduce its financial contribution accordingly the following financial year.

vi) After two full years of operation, a decision will be made whether or not to continue the County Council's revenue funding to The Lights beyond 2008/09. The main criteria for this decision will be the extent to which the business plan objectives have been met and an assessment of The Lights' continuing ability to contribute to fulfilling the County Council's strategic objectives.

vii) An Outreach Programme, as set out in 4.15 needs to be presented to Hampshire County Council in July 2006.

viii) A final report for decision needs to go to the Executive Members for Children's Services and Policy and Resources.

Section 100 D - Local Government Act 1972 - Background Documents

The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

NB the list excludes:

1. Published works

2. Documents which disclose exempt or confidential information as defined in the act.

TITLE LOCATION

The Lights - Business Plan Arts Service, Mottisfont Court

Appendix 1

Staffing Structure for The Lights - Year One

Venue Director 42

Appendix 2

Budget for The Lights, Years 1-3

Notes to the Budget

· Assumes a net expenditure as per Report of the Corporate Director on 9 Feb 2005 which was calculated as £153.1K staffing support + £50K cash = 203.1 TVBC net expenditure.

· 3% used as a general inflationary increase

· Staff Increases: annual increases based on 3% + incremental increase of 5% in each of first three years. If staffing includes existing TVBC staff at the top of scales, the totals will be less than those stated.

· Figures assumes that TVBC pick up additional HR, extra IT, Payroll, Legal, minor capital costs

· Temp staff and tutors calculated at increase of 5% per annum

· Electricity: College annual bill is £84,000. The theatre block constitutes around 20% of the floor space. However the College has heavy usage for hair salon and technical facilities thus The Lights calculation is at 10%.

· Gas: Venue catering only thus small percentage of college costs.