Tuesday 7 April 2020
Bromsgrove’s Artrix arts centre has ceased trading from today after being forced to close its doors because of the COVID-19 pandemic.
The charity has been in talks with senior officers from Bromsgrove District Council, which leases the building to the charity, since last year, looking at options to secure financial investment. But the impact of the recent COVID-19 pandemic on the fragile recovery of Artrix, means the arts centre must cease trading – or risk trading illegally.
Angela Galvin, Director of Artrix said:
“This is devastating news for the whole amazing Artrix family - our small but mighty team of paid staff who are losing the jobs to which they have dedicated themselves with such passion and vigour for so long, and our wonderful volunteers who have given thousands of hours to supporting our work, because they believe in what Artrix stands for. We thank our staff and volunteers for everything. Our hearts also go out to those who have bought tickets and made donations, the social and family groups, the carers, the artists, the workshop leaders and participants, and the local businesses who are part of the Artrix family and who will all feel the impact of our closure. Over the past 15 years we have shown there is a need for an arts centre in Bromsgrove, the need is still there, the goodwill is still there. We sincerely believe that when this extraordinary situation is over an arts centre for Bromsgrove will rise again.”
Full statement from the Trustees:
The trustee board of Artrix has been closely monitoring the charity’s finances since April 2018, when our funding model changed significantly.
Through a series of changes to our structure and business, with the tremendous hard work of our team and loyalty of our community, we managed to work through the first year without grant funding, and watched income from other sources grow to a point where the prospect of survival and development became a reality.
In recent months we have been in positive dialogue with Bromsgrove District Council about our lease, and the possibility of future financial investment.
This fragile recovery has been cut off by COVID-19.
On Government recommendation we closed our building on 16 March. Our daily income dropped to zero from 17 March. Our outgoings have not.
We have been unable to access Government support in the form of grants or loans as we do not meet the eligibility criteria.
We, like many other venues, have been unable to claim against our business interruption insurance because insurers are not recognising COVID-19 on their list of notifiable diseases. 18 of team Artrix are now on furlough through the Government’s Job Retention Scheme.
The remaining 4 salaried staff have been holding the fort on finance, rescheduling the programme and
dealing with emails to box office.
The cost of mothballing the business on a skeleton staff together with building overheads is almost £10,000 a month.
With no income since 16 March, and no certainty of returning to normal ticket sales and catering income for at least 6 months, our assets do not cover our liabilities and we are therefore technically insolvent.
The trustees have taken advice from the Charity Commission and an insolvency specialist.
Following this advice the trustees reluctantly conclude that Bromsgrove Arts Centre Trust – Artrix – must cease trading immediately or risk trading illegally.
We as individuals will stand down on the appointment of a liquidator. But Artrix will return when this is all over, we are sure of that.
What happens if I have already bought a ticket or gift voucher?
If you have bought a ticket or gift voucher you are a creditor. Your contact details will be recorded on our box office database and these details will be shared with The Timothy James Partnership, who will contact you to make sure you are aware of your rights and the insolvency process. Alternatively you can contact our advisor direct: Tim Heaselgrave firstname.lastname@example.org
What happens if I have paid a deposit for hiring Artrix?
If you have paid a deposit for a future hire you are a creditor. Your contact details will be shared with The Timothy James Partnership, who will contact you to make sure you are aware of your rights and the insolvency process. Alternatively you can contact our advisor direct: Tim Heaselgrave email@example.com
What happens if your act has been booked as part of the Artrix programme?
Our first response to closure was to reschedule all acts booked from March to May 2020 to dates later in the year or into 2021. As the potential end-date for lockdown has been extended, some acts have cancelled and we have tried to anticipate when a re-opening date might be for others. In these exceptional circumstances all usual contract terms have been suspended. If your act has been caught up in this uncertainty we will contact you.
Isn’t the Government supporting businesses hit by COVID-19?
We have been working tirelessly to see how Artrix can benefit from the various business support schemes. In summary:
· Business Rates 12 month holiday. Eligible. Payments suspended.
· Support Grants. One-off grant of £25,000 administered through the local authority. Ineligible. Rateable value capped at £51,000. Artrix RV is £61,000
· Job Retention Scheme Eligible. All the correct steps have been taken to place 18 of Artrix’s team on furlough under this scheme.
· Business Interruption Loan Scheme. The scheme offers overdraft terms of 3 years, finance terms over 6 years. As we don’t own the building and the lease has only 6 years to run we cannot offer the security required by lenders.
· VAT deferral. Eligible. Our next VAT repayment has been deferred for three months to the end of June 2020 and will be payable by the end of the financial year 2020/21.
· Self Employed Income Support Scheme. Sub-contracted staff may be eligible depending on their tax status. Payments will start in June. In the meantime contractors will be eligible for universal credit.
How is Artrix funded?
For the first ten years Artrix was financially supported by HoW and Bromsgrove District Council with smaller scale investment from Worcestershire County Council, together with income generated through ticket sales and grants for specific project activities.
Income from Worcestershire CC, BDC and HoW College ceased entirely in March 2018, resulting in a funding gap of £115,000 from April 2018 onwards.
Since April 2018 we have restructured behind the scenes, changed our contract terms with performers and introduced new pricing to help bridge the gap. But our income dropped to zero overnight when we closed the doors in line with Government recommendations on 16 March 2020.
Why is the Lease an issue?
The Artrix building was constructed on land gifted by North East Worcester College (now Heart of Worcestershire College - HoW) and opened in April 2005.
The lease on the building, which runs to 2026, is held by The Bromsgrove Arts Development Trust, charity 1097575, which is a completely separate entity to Artrix.
Having just a few years left on the lease has been an obstacle to raising funds for Artrix as large scale funders often require a long lease as security against their grant. It has also affected our ability to take advantage of business loan schemes.
By February 2020 discussions with BDC had progressed to the point of agreeing that the council would support Artrix in securing a rewritten lease with more favourable terms.