Ad Hoc Finance Written

AD-HOC FINANCE COMMITTEE

Rachel Streich, Lori Falco, Allan Kugel, and Eddie Roffman

For the past two years, the Folk Project has been losing money on operations. Last year those losses amounted to $15,725. We also subsidized the Getaway in the amount of $2,926, so if we consider the subsidy as adding to our operating income, our total adjusted operating losses for 2014 were $12,800. In 2013, our operating losses, adjusting for the Getaway subsidy, were $3,779. However, in 2013 we neglected to pay the premium for our liability insurance. If we had, the operating loss would have been around $6,600.

The impact of these losses can be clearly seen from our dwindling bank balance, shown on the attached graph. Our bank balance has fallen from $29,831 in January 2013 to $6,749 in December 2014, a difference of $23,082. To cover these losses, we had to transfer money from the Vanguard account into our Money Market account in January 2015. If we continue to sustain operating losses of this size, we will deplete the operating expenses portion of the Vanguard account by the end of this year.

Since Mike Agranoff first established the endowment the funds have been dedicated to subsidizing the Getaway. If the rate of operating loss continues through this year, in 2016 we will also have to use the endowment funds to subsidize our operating expenses. As the endowment fund dwindles, this will reduce both our cushion against future losses and the subsidy to the Getaway.

The operating losses have occurred because expenses have risen over the years and our venues and other income-generating activities have not provided enough revenue to cover those expenses or, in some cases, to cover the expenses incurred by the venues themselves.