ADMINISTRATIVE REPORT

Date: June 16, 2001
Author/Local: S. Harvey/6001

RTS No. 02116

CC File No. 2201/4008

CS&B: July 12, 2001

TO:	Standing Committee on City Services & Budgets
FROM:	Director, Office of Cultural Affairs in consultation with Director of Financial Planning & Treasury
SUBJECT:	Vancouver Maritime Museum - Annual Review and 2001 Operating Grant Request

RECOMMENDATION

A. THAT Council approve an operating grant in the amount of $269,394 to the Vancouver Maritime Museum; source of funds to be the 2001 "Other" Grants budget; and

B. THAT Council approve a supplementary grant in the amount of $82,820 to the Vancouver Maritime Museum for the operation of the St. Roch; source of funds to be Contingency Reserve.

GENERAL MANAGERS' COMMENTS

The General Managers of Community and Corporate Services RECOMMEND approval of A and B.

COUNCIL POLICY

Council has approved annual operating grants to the major exhibiting institutions to support their ongoing operations since their formation as independent non-profit societies in 1971.

The City's relationship with the Vancouver Maritime Museum (excluding the St. Roch) is outlined in an operating/lease agreement which expired May 31, 2000. The agreement between the City and the VMM with respect to the St. Roch expired on June 30, 1997. A new comprehensive operating lease/agreement is in the process of being negotiated. Inthe intervening period, the relationship is being continued on generally the same terms and conditions as contained in the expired agreements.

Approval of a grant requires eight affirmative votes.

PURPOSE

This report provides a review of the Vancouver Maritime Museum's 2000 activities and presents for Council's consideration their 2001 Operating Grant request.

BACKGROUND

The Vancouver Maritime Museum (VMM) has operated in its current location in Kits Point since 1958. The VMM was operated by the City until 1972 when it became part of the Vancouver Museums and Planetarium Association. In 1987 Council agreed to the dissolution of the VMPA into three distinct organizations: the Vancouver Maritime Museum Society, the Vancouver Museum Association and the BC Space Sciences Society. The City currently provides capital and operating support through grants to the Vancouver Maritime Museum as well as janitorial services, grounds and building maintenance through the City's Building Management Department.

The St. Roch is also owned by the City of Vancouver and housed in a City-owned structure adjacent to the Vancouver Maritime Museum. Built in Vancouver in 1928, the St. Roch served as a supply ship for remote Arctic RCMP detachments. Between 1940 and 1942 the St. Roch navigated of the Northwest Passage; the second ship to make the passage; the first travelling west to east. The ship was retired in 1954 and hauled ashore in 1958 for display.
In 1966 the City of Vancouver, under an agreement with the Federal Government restored and housed the ship in a temporary structure where it is still housed today. The Federal Government, through Parks Canada operated the St. Roch National Historic Site up until 1995 when they withdrew their participation, providing $75,000 per year for two years to the City as transitional funding. Council assigned the rights and obligations as well as the transitional funds to the VMM as supplementary grants to help offset the additional operating costs associated with the St. Roch. At that time Council directed the VMM to develop a fund raising strategy to provide for the future operating costs associated with the St. Roch. In 1998 the VMM presented a fund raising plan to Council and sought supplementary grants until the campaign was completed. Council has approved supplementary funds in each year since 1998.

2000 Year In Review

The VMM's exhibits, program and activities in 2000 attracted a total paid audience of 25,640. In addition to the permanent exhibits of maritime art and artifacts, model ships and the Children's Discovery Centre, the VMM hosted a series of temporary exhibits including:

· Quest for the Northwest Passage - supporting the St. Roch commemorative voyage;
· Beyond the Canvass: Artist, Stories and the Sea - focussing on maritime art and artists.

New permanent exhibits added in 2000 included War at Sea - a gallery dedicated to Canadian naval history and artifacts.

The VMM's primary activity and focus for 2000 was the recreation of the voyage of the St. Roch. The St. Roch II Voyage of Rediscovery was launched July 1st, 2000 from Canada Place. The RCMP patrol vessel, NADON - renamed St. Roch II - follow the original St. Roch's 1940/1942 transit through the Northwest Passage and the first circumnavigation of North America.

The 22,000-mile voyage was a partnership between the RCMP and the Vancouver Maritime Museum with support from the Coast Guard, the Department of Canadian Heritage Millennium Bureau and corporate sponsors and individual donors. This $1.1 million project was an enormous undertaking for the Maritime Museum involving all of the Museum staff, many volunteers, three years of planning and six months to complete.

2001 Plans

VMM plans in 2001 include the continued renovation of the permanent galleries and three temporary exhibitions:

· The Maritime Heritage of Croatian Art
· The Vikings: Master Mariners
· 1690: Siege of Quebec ... The Story of a Sunken Ship

Public programming in 2001 will concentrate on school programs and community-based events such as The Osbourne Lecture Series, Day Camps, and participation in community festivals such as the Wooden Boat Festival, Fraser Festival, and Port Day.

The VMM continues to address collection management issues including completing cataloguing and digital imaging of the collection and the adoption of a collection management policy.

Operational planning in 2001 will focus on developing site options and/or improvements to the existing physical plant.

DISCUSSION

Cultural Affairs and Finance staff have reviewed the budgets and assumptions and support the financial projections as reasonable in relation to recent experience at the Vancouver Maritime Museum, as well as other local exhibiting institutions. The VMM's financial statements for the year ending December 31, 2000 are attached as Appendix "A".

The VMM had an excess of expenditures over revenues of ($39,737) on a budget of $918,068. This brings the accumulated deficit to ($250,054). The financial statement of operations does not include the St. Roch voyage. A Schedule of St. Roch Voyage Revenues and Expenditures is attached as page 15 of the financial statement. The Voyage financial report shows an excess of expenditures over revenues of ($58,510) on a total project cost of $1.1 million, although the VMM reports ongoing fund raising since December 31, 2000 has eliminated the loss.

The VMM's 2000 budget of $918,068 and paid attendance of 25,640 was virtually unchanged from 1999 although revenues from memberships, programs and admissions were up 15%. This was offset by decreased revenues from fund raising. This is not unexpected as fund raising resources and revenues were redirected to the St. Roch campaign. Staff believe that given the limited staff at the museum, maintaining their base operations during 2000 was a significant achievement in the context of the challenging St. Roch project.

The St. Roch voyage, while a programmatic success has not been a financial success to date. Originally planned as a fund raising tool to create an endowment fund, the voyage infrastructure (staffing, and fuel in particular) proved too costly to realise any net revenues. While the VMM have raised over $1 million, and have enjoyed remarkable national coverage for their event and for the museum, they have not raised sufficient funds to cover the additional costs associated with the ongoing operation of the St. Roch.

Staff believe that the VMM made a significant effort to raise funds towards the St. Roch endowment fund. In spite of these efforts, however, the VMM has not identified a source of funds to replace the support for the St. Roch originally provided by Parks Canada and, since 1995, by the City. Staff believe that it is unlikely that the VMM will have the organizational capacity to do so in the foreseeable future and therefore recommend that Council approve both an Operating Grant and a further Supplementary Grant in support of the St. Roch.

Staff are recommending a 2001 operating grant of $269,394 and a supplementary grant of $82,820 based on the 2000 operating ($266,727) and supplementary grant ($82,000) funding levels. The 2001 grants have been increased by 1% over the 2000 grants to cover inflation.

FINANCIAL IMPLICATIONS

The source of funds for the Operating Grant is the "Other" Grants allocation as provided for in the 2001 Budget. The source of funds for the supplementary request is Contingency Reserve.

CONCLUSION

Staff recommend continued operating support for the Vancouver Maritime Museum Society in the amount of $269,394 as well as a further supplementary grant in the amount of $82,820 for the operation of the St. Roch.

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APPENDIX A NOT AVAILABLE ELECTRONICALLY - COPY AVAILABLE FROM THE CITY CLERK'S OFFICE

(c) 1998 City of Vancouver