Under financial strain caused by statewide coronavirus-related restrictions, the Smith Center for the Performing Arts came to Las Vegas city leaders on Wednesday asking for a $1.8 million advance.
The City Council unanimously obliged by agreeing to front the downtown cultural hub $900,000 now from a special revenue fund and the other half later, if necessary or if possible.
“During the pandemic we are closed, we are dark, we are completely shut down,” said Myron Martin, president and CEO of the Smith Center. “The only cash register we have is the one that rings up ticket sales and we have no ticket sales.”
The Smith Center ruled out in the summer reopening in 2020, unable to hold full-sized performances due to public health restrictions. Scaling back capacity is not financially feasible, according to Martin.
And despite cutting more than two-thirds of its staff and instituting significant pay cuts for remaining employees, the center faces a little more than $600,000 of unavoidable monthly operating expenses, according to the city and the center. Martin said the city, private donors and others have been helpful.
The assistance being provided by the city will not come from its general fund, but instead from excess car rental fees.
The Smith Center was built in 2012 as a public-private partnership and paid for in part by a 2 percent tax on rental cars. General obligation bonds were issued, and the tax pays the debt service. Excess tax revenues go toward, in order, boosting debt service reserves; repaying the city redevelopment agency which chipped in $20 million for construction; and funding operations and maintenance at the Smith Center.
The center, which is responsible for all operations and maintenance, will be receiving excess tax proceeds earlier than normal, according to city officials and Martin.
But even those tax proceeds have been severely affected by the pandemic as declines in tourism resulted in fewer cars being rented, city Chief Financial Officer Gary Ameling said.
The city has been able to cover debt service payments, relying on reserves, and it will wait to see the effect on proceeds from the summer before deciding whether it is able to provide the center the second payment of $900,000, according to Ameling.
The city receives tax collection information three months after it’s collected, explaining the delay on granting the center the full $1.8 million.
Councilman Cedric Crear, whose ward encompasses Symphony Park where the Smith Center is located, said the venue is more than just a place to listen to music or see a play.
“It is community. And it’s much different than any other performing arts facility, stage or what have you, than anywhere in our state,” he said. “And I think we have an obligation to support it and to do what we can to ensure its success, especially during these dark times.”