After years of financial trouble, Millburn, N.J.’s Paper Mill Playhouse has sold its own real estate to its most loyal supporter: Millburn, N.J.
By unanimous vote of its Township Committee on Tuesday night, the city has elected to pay $9 million to the Paper Mill for the buildings and the land housing the 1,200-seat nonprofit theater and will lease the property back to the Paper Mill. Millburn Mayor Sandra Haimoff described the decision as good business sense, saying that, despite its monetary woes, the theater remains “an economic driver for the township. It brings at lot of business to stores and restaurants and so forth in the area.”
Haimoff rejected the notion that Millburn would now be running the theater. “We’ll have a person sitting on the board of trustees, but we’ll have nothing to do with the running of the Paper Mill Playhouse itself. Also, it’s a win-win because at the end of the day, the town owns all of this land if for some reason the Paper Mill defaults.” The city will lease the property to the theater for up to 75 years, and the theater will have the option to repurchase in 11.
Local support of the 74-year-old Paper Mill has been overwhelming in recent years, even as memories of prestigious productions like 1984’s “You Can’t Take It With You” faded. In the spring of 2007, the theater received an outpouring of small donations (but no bailouts from major donors) following an announcement that it probably would not be able to put on its final two productions — and might close its doors for good. The productions just barely made it to the stage, where they subsequently saw strong ticket sales, but perpetual budgetary shortfalls remained a problem.
In fact, Paper Mill exec director Mark W. Jones admits that “it’s only in the last year that they’ve had an annual fund-raising operation” — one of the cornerstones of most nonprofit theater budgets. Jones took over at the theater in November.
Saddled with a $3.5 million Investors Savings Bank loan in addition to about $1 million in other debt, the theater turned to the city for help. “I think that most importantly, their whole business model and their management has changed for the good,” said former mayor and township committee member Dan Baer. “For years and years they’ve relied on the dollars that are generated through ticket sales, and I think now they’ve realized they have to fund-raise and do these other things.”
So with reformer Jones at the helm of the no-longer-sinking ship, the Paper Mill will use about half of the $9 million to enter the 2008-09 season debt-free and a little to make necessary improvements to the theater itself; the rest will go into an endowment that will be used for the fledgling fund-raising campaign.
“We’ll get a fresh financial start,” said Jones. “We’ll have about $5 million in the bank, along with the $5 million we have from subscription renewals.”