A.S.T.C. Science World Society-Annual Report and Operating Grant Request

ADMINISTRATIVE REPORT

Date: June 8, 1999
Author/Local: S. Harvey/6001

RTS No. 00756
CC File No. 2201
CS&B Date: July 8, 1999

TO: Standing Committee on City Services and Budgets

FROM: Directors of Office of Cultural Affairs and Finance

SUBJECT: A.S.T.C. Science World Society - Annual Report and Operating Grant Request

RECOMMENDATION

THAT an operating grant of $80,000 be approved to the A.S.T.C. Science World Society, with the source of funds to be the 1999 ‘Other’ Grants budget.

GENERAL MANAGERS’ COMMENTS

The General Managers of Community and Corporate Services RECOMMEND approval.

COUNCIL POLICY

Council has approved annual grants to A.S.T.C. Science World to support their ongoing operations since 1982 through either the “Other Grants” or “Cultural Grants” budgets. In 1997 Council directed that this grant be considered in the context of the “Other Grants” category.

Approval of grants requires eight affirmative votes of Council.

PURPOSE

This report provides a review of Science World’s 1998 activities, and presents for Council's consideration their 1999 Grant request.

BACKGROUND

The A.S.T.C. Science World has received civic support since its inception in 1982. In 1989 the Society moved into the renovated EXPO Centre which is leased to the City by the Province, and subleased to the Society.

Science World provides hands-on, educational and entertaining programming and exhibits founded in arts, science and technology.

1998 Year in Review

After several years of instability, Science World has refocused its program and strategies and have completed a year of positive improvements to attendance, and financial performance.
The Strategic Plan calls for science education in a customer oriented environment. During 1998, Science World hosted five feature exhibits, six films, and numerous special events in addition to their permanent exhibits. Exhibits and films are targeted at science themes in a more popular and entertaining context. Programs, exhibits and special events have been focused on partnership opportunities: Sounds in Space, a musical sound installation created by a composer-in-residence at the Western Front; Clean Air Day with the G.V.R.D. and Automotive Technology Showcase in tandem with the Molson Indy. Science World also continued their extensive outreach program ranging from teacher training, career planning and science mentorships for senior high school students to the administration of community science fairs.

The Strategic Plan also called for a plan to address a long-standing structural financing deficiency caused by an under-capitalized endowment. When Science World first opened, they did not meet their target goal for a $5m. endowment fund which was to provide sufficient revenue to maintain the building and renew exhibitry. In the intervening years, they tried to fund major maintenance through their operating budgets or simply deferred maintenance. Consequently by 1997, they had developed a financial, physical and programmatic deficit. The accumulated deficit had reached $252,175, the building and exhibits looked worn and were in need of replacement or renewal.

In 1998 a $2.1 million endowment fund held by the Science World Foundation was wound up and the funds were distributed to the A.S.T.C. Science World Society. The funds are restricted and can only be used for building improvements and exhibit renewal. Funds are also to be used, on a repayable basis to finance a new capital campaign which is to raise funds for a major refurbishment and to replace and increase the endowment fund. In 1998 restricted funds were allocated to building improvements (carpet replacement, painting, chillers etc.), exhibit renewal and for preliminary fund raising feasibility studies.

1999 Plans

The major exhibit planned for 1999 is UFOs: the Why Files and The Science of Sport in conjunction with the Imax film on the Nagano Olympics. This provides an excellent opportunity for new relationship with Sport B.C. and the myriad of community sport organizations in the city. Plans for 2000 are also complete. Advanced programming provides much better strategic planning opportunities for community, corporate and institutional partnerships and staff encourage continued long-term planning.

DISCUSSION

Staff have reviewed the 1998/1999 financial statements and operating assumptions for 1999. Science World changed their year-end from May 31st to February 28th in order to improve their budgeting process. Audited financial statements for the nine-month period ending February 28, 1999 are attached to this report. Science World posted a surplus of $16,000 on a budget of $6.43 million and eliminated the accumulated deficit. The Society continues to make improvements to earned revenues with a total of 60% of revenues from admissions and memberships and a further 17% from gift shop, food services and rentals. Staff commend the Society for the significant improvements in the financial performance.

While the City’s grant is less than 1% of the total budget, it remains the only unrestricted government funds secured. Science World does receive funds from the Province for specific science education projects. They receive no other grant funds for the day to day operations of the society or for the ongoing permanent exhibitions. Science World representatives maintain that the City’s support is important in actual dollars terms, but also as leverage to other private sector funders.

The major challenge before Science World is a major fund raising campaign. The goal will be to secure sufficient funds to complete the base building revitalization, exhibit infrastructure and to build an endowment to ensure a program of ongoing renewal. While Science World has had excellent membership, corporate sponsorship and special events results, they will need to focus on building their development base in order to complete a major capital campaign.

Science World is also facing increasing pressures from new competitors in the market place of film presentations and family entertainment. Films provide a significant source of revenue for Science World. Several new Imax cinemas have recently been built in the surrounding municipalities and at least one proposed in the downtown. Staff believe that the films developed for Science World will continue to be the more educational type and that audiences will continue to view the Imax experience as a part of their Science World visit. However, Science World will be facing increased marketing costs, competition for film product and the potential loss of evening, patrons. The most significant long-term impactmay be a potential trend away from investment in the creation of educational Imax films in favour of these more commercial product offerings within entertainment centres. Science World will need to invest more resources in future product development and marketing to maintain their audience.

FINANCIAL IMPLICATIONS

The source of funds for the operating grant is the “Other” Grants allocation in the 1999 Budget.

CONCLUSION

Staff continue to believe that Science World is an important contributor to art, science and technology education in Vancouver. They are a well managed non-profit organization that has restored stability to their operations and developed a responsible strategic plan for the future. Staff concur that the civic grant continues to be both valuable and necessary and therefore recommend that Council approve a 1999 Operating Grant of $80,0000 to A.S.T.C. Science World Society.

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