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ACC takes action: Proactive plans put in place for next six months
By Bill Conrad and Marthe Stinton, Staff Writers
After months of uncertainty, the Arts of Collin County (ACC) is taking aggressive steps to move forward.
Plans released Friday by ACC Executive Director Mike Simpson and Board President Bobby Baggett show two possible scenarios for the project's future.
Under Plan A, the board has set financial benchmarks that must be met in order for the project to continue. To help meet fundraising goals, an agreement would be made with CSL Marketing, a firm that Simpson said would help secure large donations and a naming rights sponsor.
CSL would be paid $4,100 per month while receiving a percentage of the contracts generated. At the end of six months, CSL is expected to raise between $3.5 million and $11 million, with the potential to raise $30.7 million over the life of the contract.
The plan presented to the board of directors and the owner cities said CSL "has access to new and different companies plus decision makers who control different budgets within the companies."
Plan A also makes several assumptions, including restricting the project to lower start-up costs. The ACC could use the value of the land to help entice donations.
Of the 124 acres, 12 acres have been retained by Briar Ridge Investments for commercial use. As a way to attract sponsors, Simpson said a portion of the remaining 112 acres may be given to corporations in exchange for donations.
At the end of six months, Plan A will be reevaluated. If the financial benchmarks are met, the second part of Plan A will be implemented. In this period, a new budget will be approved. The ACC will also attempt to receive statements from the owner cities supporting the continuation of the new direction for the balance of FY 2011-2012.
If the benchmarks are not met, the project will move into Plan B, which has three options: suspend fundraising and preconstruction activities for the next year; spin off the ACC or its assets into a new 501(c)(3); or wind down, liquidate and dissolve the ACC.
If Plan B must be enacted, Simpson said the most desirable option is creating a spin-off.
"If the cities would agree to a spin-off scenario, we would become a 501(c)(3)," Simpson said. "If that occurred, the cities could come back in and be a partner with us. This is just a scenario that has been thrown out there as an alternative to losing the assets and the donations."
If the project is dissolved, which Simpson said is not recommended by the ACC, it has yet to be determined what would happen next. Attorneys will have to determine how the money will be split between the three cities, he said.
"There is a misinterpretation that the donations go back to the donors, but they have already taken a tax deduction for it," Simpson said. "It says in the articles of incorporation that the distribution of assets by the cities shall be exclusively for religious, charitable, educational, scientific, public or cultural purposes."
Both plans also come with a reduced budget. The total cost for Plan A is estimated to be $588,000, down $250,000 from the 2010-2011 budget. If Plan B is adopted after six months, the total cost for 2011-2012 is predicted to be $516,000.
A new 2011-2012 budget has not been adopted by the board. Simpson said that if a new budget cannot be approved, the ACC's governing documents state the previous year's budget will be automatically adopted. However, instead of this occurring, Simpson said the board will act on the consensus of Plano and Allen.
The plan said this was not to be construed as being "disrespectful toward any dissenting city in any way; however, in order to function the organization may find itself in a position to seek a majority of owner cities' direction if a unanimous decision is not achievable."
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