It’s only a footnote in the troubled financial history of the Leeds Grand umbrella company, but worth recording nonetheless: Leeds City Council has agreed to write off £379,000 the company owed.
The sum represents the outstanding part of the Grand’s share of the bill for the refurbishment of the City Varieties, one of the three arts organisations it runs.
Council leaders agreed last week to a request from the company, which is currently owned by the council but run “at arms length”, that the contribution be written off.
Following a council review last winter, the plan is for the company to turn itself into a charitable trust.
Leeds Grand Theatre and Opera House’s share of the cost of the refurb (which was completed in 2011) was set at £1.2m, but the company only managed to raise £615,000, leaving a £593,000 hole.
“The Theatre Board recognised that given the Company’s current financial position and future financial challenges … it is not likely that the Company will be in a position to fund this shortfall and will help the Company to convert to an Independent Trust (sic),” said a report drafted for last Wednesday’s meeting.
“To this end the Company has written to the Council to request that this funding shortfall is written off. Given that the scheme has come in under budget, the actual level of additional debt the Council would need to raise to fund this £593k shortfall would be £379k.”
Annual grant cut
The Leeds Grand umbrella company – which runs Leeds Grand Theatre, the City Varieties and the Hyde Park Picture House – has been operating at a significant deficit for a number of years and has relied on its reserves and extra cash from the council to balance its books. Its unrestricted reserves have now dried up.
The review of the way the company operates was launched by the council in July 2014 as it bailed out the company to the tune of £653,000.
The council has pledged extra funding (over and above the grant it gives the company annually) for the next couple of years to make sure the company remains a going concern.
Along with most other arts organisations in the city, the company had its annual grant from the council cut this year – down from £200,000 in 2014-15 to £160,000 in 2015-16.
According to its most recent company accounts, Leeds Grand is also facing a future bill of up to £2.5m to get the roof of the Grand Theatre building replaced. “The roof is now losing slates in high winds,” said a disconsolate report from the company’s directors lodged with Companies House in January this year.
Back in February, it was agreed by council bosses that the company move to immediately appoint an interim full-time chief executive – to lead the effort to turn around the company’s “current deficit-generating business model”.
If the job’s been advertised and/or filled, I missed it.