A new report suggests a new Juneau Arts & Culture Center would turn a profit within three years.
At the Juneau Economic Development Council’s Tuesday night Willoughby District Stakeholder meeting, New JACC Partnership board members said a new feasibility study from the Juneau consulting firm McDowell Group paints a rosy financial picture.
“This is McDowell’s third take on this issue in the last five years,” said New JACC Partnership Capital Campaign co-chair Bud Carpeneti. “Each one is built on the last one. It’s built on eight to 10 years of JACC operations.”
The New JACC is a proposed project that would replace the existing arts and culture center at 350 Whittier St. built in 1959 with a new facility with amenities including a theater, gallery, community hall and more. The New JACC Partnership is a nonprofit organization working toward making the new building happen.
A rendering of what the New Juneau Arts and Culture Center could look like. (Courtesy Photo | The New JACC)
The project has been the subject of much public discussion and multiple studies.
“They’ve been very careful in coming up with these final analysis numbers,” Carpeneti said. “The projected performance of the New JACC keeps getting better every year.”
A 2017 report predicted the project would break even by Year 3 while the new assessment shows about a $50,000 profit by the third year and $4,000 in net revenue by the second year.
After the third year, the estimated cash flow levels off to $48,500 in the fourth and fifth years.
Those estimates are based on mid-case scenarios for revenue streams, according to the study. Low- and high-case scenarios are also included in the report.
Event space rentals make up the largest revenue stream in the third year cash flow estimates in the feasability assessment at $126,000. Theater rentals at $100,000 and Ticketing at $69,000 are the second and third largest sources of revenue.
For expenses, $280,000 for payroll and benefits and $110,000 in heating and electricity costs are tops. In a distant third and fourth place are $25,000 in miscellaneous costs and $24,000 in insurance.
Carpeneti said the cash flow estimates do not include any revenue that may come from summer productions at the theater proposed to be housed in the potential New JACC.
In the report, a high-case prediction of what that could bring in is listed at $120,000, but Carpeneti said since it would be a new effort, that figure was not used in mid-case revenue estimates.
“Such revenues are not included in the low- or mid-case scenarios as there is less certainty when compared to projected community demand,” states the report.
Carpeneti said support from the Juneau Community Foundation was included in revenue for the project in the new report, which could explain the improved outlook but said the project is at least as viable as previously thought.
JCF support is listed as a $50,000 revenue source in cash flow estimates.
Ben Brown, marketing & development director for the Juneau Arts & Humanities Council, said information from the report will be available on the New JACC website Wednesday morning.
Brown also spoke to some of the project’s history during a presentation, including the recently raised possibility of pairing it with a renovation to Centennial Hall under the same roof.
[Both the JACC and Centennial Hall want big improvements, could one building be the answer?]
Brown said while the Centennial Hall renovations are needed, the New JACC plan is “shovel-ready,” and the New JACC fundraising efforts can’t be replicated for that project.
“They are kind of at the starting line, and we’re laps around the field,” Ben Brown said.
Construction of the new building is expected to cost $26.4 million, and the project is 19 percent of the way toward that goal through fundraising, according to NewJACC.org.
Brown also mentioned the possibility of the project receiving a boost from public funds, an option that fell a single vote short of appearing on municipal ballots.
[What’s the future for New JACC funding]
Brown said if taxpayer money is used to fund the project it could take the form of an additional sales tax or general obligation bonds.
“That’s up to the Assembly,” Brown said.
• Contact arts and culture reporter Ben Hohenstatt at (907)523-2243 or bhohenstatt@juneauempire.com.
