Aspen council will consider fee hikes for Wheeler
July 31, 2012
ASPEN – The Aspen City Council Tuesday will consider options for raising Wheeler Opera House rental fees and adding extra charges to box-office ticket sales, city officials said Monday.
The meeting is a work session, designed to give opera-house and city administrators direction on the issues. The council could decide not to implement any fee-structure changes. But the fact that the opera house loses money on both operations – requiring the city to subsidize them – could necessitate some type of new policy, according to Assistant City Manager Randy Ready.
“We want to be careful about which fees are implemented,” Ready said. “We want to be sure that they’re fair and not a barrier to somebody either presenting a show, in the case of rental fees, or coming to a show, in the case of tickets.”
Full review, discussion and implementation of changes at the Wheeler was one of the council’s top 10 goals for 2011-12. In recent years, some council members have expressed concerns over programming decisions and other matters involving the historic opera house’s finances with an eye toward reducing or eliminating city subsidies that cover operating losses in different areas, such as city-sponsored festivals.
A July 16 memorandum from Wheeler executive director Gram Slaton points out that council members accepted five of seven recommendations that came from opera house staff and the facility’s board of directors during a June 5 work session. The council, however, asked for more information regarding alternatives for higher rental fees for nonprofit and for-profit groups as well as more information to support the call for extra ticket charges. Those details will be shared at Tuesday’s meeting, which begins at 4:30 p.m. in the basement of Aspen City Hall at 130 S. Galena St.
Slaton noted that the board recommends that the Wheeler proceed cautiously with rental-rate increases “while remaining sensitive to the ability of its not-for-profit user groups and others to afford use of the venue.”
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The ticket-sales issue relates to the Wheeler’s box office operation, Aspen Show Tickets, which sells access to local events whether they are held at the opera house or not. It has grown into a $1.9 million annual business – not in terms of profit but with regard to the total amount of money flowing through the operation.
“Because outside sales demand more investment in Wheeler staff time and other resources than events that take place inside the historic venue, a review of the fee structure is in order, particularly as the soft costs necessary to make this program successful have not been fully incorporated into its numbers,” Slaton’s memo says.
Still, Wheeler staff and board members urge caution in raising or implementing new ticket fees, Slaton wrote, “as absorption of a large increase of the total cost of doing sales through Aspen Show Tickets may become cost-prohibitive and drive clients toward other providers.”
Councilman Derek Johnson said that after examining the Wheeler lease rates charged to for-profit groups, “it felt to me like the lease rates that we charge at certain times of year are pretty low given competition regionally and competition within the Aspen area.”
Johnson, who manages 19 different retail operations for Aspen Skiing Co., said he understands the concern shared by Slaton and the board regarding the need to be careful with pricing changes.
“It’s always a little nerve-racking when you do any adjustments in your pricing,” he said. “You can theoretically hit a tipping point and drive some of your business away. You’re always trying to find that balancing point of what is the appropriate price.
“It’s council’s job to point out that if the price is too low, the rest of the community has to bear the additional expense. Clearly the Wheeler is an asset for the community, and there are many events that could or should be run at a subsidy rate. But there are additional events that actually provide a return to the Wheeler and its operating budget. It’s like a teeter-totter, and we have to do a balancing act.”