TUNKHANNOCK — The Dietrich Theater will announce a public fundraising campaign during the Hometown Fall Fest at 11:30 a.m. Saturday, Oct. 6. The purpose of the campaign is to insure the future sustainability of the cultural organization. The campaign seeks to raise $335,000. Reaching that goal would satisfy three relatively modest loans, which costs the Dietrich $2,600 per month in payments.
The event will feature a mortgage burning on the Dietrich’s outside green space.
Community campaign chair Margie Young explained the Dietrich has been able to retire one of the three loans because of the success it has already achieved. The campaign has received several gifts and grants in advance of the campaign.
Major corporate and foundation support has been committed by the Sordoni Foundation and the Sordoni Family Foundation, the Kenneth and Caroline Taylor Family Foundation, Cabot Oil & Gas Corporation, and Procter & Gamble. Additional corporate support has been received from Cargill, Jacobi Capital Management, M & T Bank, and Peoples Security Bank & Trust.
Erica Rogler, executive director of the Dietrich, explained the ultimate success of this community effort will increase the Dietrich’s cash flow by more than $31,000 a year.
Troubles began in 2008
The Dietrich’s financial distress began when the theater expanded in 2008. It was found that the site of the old gas station was contaminated with two gas tanks even though the Department of Environmental Protection had given an environmental clearance of the land before the Dietrich purchased it. The cost of removing the buried gas tanks and remediating the soil created a financial burden of $48,808.
Also, during 2008, steel prices rose significantly, causing the cost of the expansion project to jump. To make things worse, at the same time, an economic recession hit nationally. Even though $1.7 million was committed to the project, the Dietrich’s board of directors had to develop a financing plan with Peoples Security Bank & Trust to bridge the gap between the project’s cost and what was raised. The directors reasoned that increased revenue from the expansion would cover the debit service. The loans were guaranteed by the USDA, and the project was underway.
Nevertheless, the expanded Dietrich Theater opened in June 2009 and was an early success. The expansion provided for a greater variety of movie and cultural offerings and the Dietrich’s concession and ticket revenue increased by 59 percent.
The 2011 flood
Then in September 2011, a devastating flood hit downtown Tunkhannock. The Dietrich lost its HVAC system located in the basement of the original portion of the Dietrich and much of the theater’s interior needed to be replaced or repaired. The community came to the rescue and more than 300 volunteers helped restore the Dietrich to its preflood glory. Individuals and businesses donated more than $74,000.
Even with all the public generosity and volunteer labor in the aftermath of the flood, the Dietrich still needed a Small Business Administration low-interest loan of $139,800 to help with the cost of a new roof-top HVAC system, some professional labor and loss of income during the four months after the flood that depleted the Dietrich’s reserves.
The Dietrich tightened its belt after the flood. Employees worked without remuneration and the board renegotiated its debt by consolidating its loans at a better interest rate.
The Hollywood calamity
Then in the summer of 2017, Hollywood calamity struck with its most dismal performance ever. The movie industry had not seen numbers like this since 9/11, and the Dietrich’s movie ticket and concession revenue reflected this slump. The Dietrich’s board anticipated the Hollywood calamity and added a third week to its Summer Fest of foreign and independent movies. It proved successful but could not supply enough help to save the summer season. To stay solvent, the Dietrich had to borrow from its emergency line of credit which had reached $74,000.
The cost increase of the expansion project, the gas tanks removal, the flood of September 2011 and Hollywood’s summer of 2017 failure created a situation where the Dietrich’s level of debt was incompatible with its cash flow.
The proceeds of the sustainability campaign will be used to retire three loans and allow the Dietrich Theater to be an entertainment and educational hub for generations to come, allowing it to weather whimsical movie cycles and major maintenance issues. For more information about the Dietrich’s campaign, call the Dietrich Theater at 570-996-1509.