Politics

Why Andreotta is wrong about the Playhouse

By Bill Moss, Published: June 18, 2024

During recent meetings of the Henderson County Board of Commissioners, Daniel Andreotta has raised questions about grants to nonprofits contained in the county’s 2024-25 budget.

The prime quarry in his safari for suspect recipients, the Flat Rock Playhouse, was fully prepared to present a defense of a $30,000 grant contained in the draft budget on June 3.

“We were explicitly invited to come and answer questions that Daniel was concerned about,” said Lisa K. Bryant, the theater’s artistic director.

Before the June 3 meeting, Andreotta had “started an email thread that he included all of the commissioners on and had a series of questions and concerns,” she said. Another person on the email thread “encouraged him a number of times to contact myself or Sam directly,” she added referring to the theater’s managing director, Samantha Goodrum. “He claimed that he had done so and that we never responded. That’s inaccurate. He never reached out to us.”

When the June 3 meeting was gaveled to order, “We had probably about 25 to 30 Playhouse supporters also in attendance,” Bryant said, “and the time came for him to talk and then he never invited us up.”

Bryant said as she understood the rules, Playhouse administrators or supporters were not permitted to rise to speak for the theater unless called to the lectern to do so. She’s right; that’s the practice.

Andreotta again criticized the Playhouse donation — more on that later — without taking the obvious opportunity to receive a first-hand account of the facts from those who know the facts inside and out.

Facts Andreotta doesn’t want to hear

Since Andreotta prevented a balanced picture from reaching the public, we thought we’d do it for him.

“Basically, in 2024, about $3 million of our budget represents over 160 W-2 employees,” Bryant told me. “They are eating here. Some of them live here and are residents paying their own taxes. But certainly the transients and the seasonal people are attending restaurants and shopping and there isn’t one of them that doesn’t have family, friends, etc., coming to visit them one or more times during their stay.”

Besides forming Playhouse Jr., creating “Letterland Alive!” — “specifically for Henderson County at the request from the public schools” — and bringing the live show “to every single elementary school in Henderson County … we also added a history musical because all fourth graders in the state have to study North Carolina history.

“Since 2019, conservatively we can say we have visited with over 35,000 kids and that’s just Playhouse Jr. and the touring program. We also bus kids in to see shows at the Playhouse.”

An economic impact study in 2012 estimated that the Playhouse generates

$10 million a year in tourism spending, although Bryant said county officials had expressed doubt about the number.

“In contributing to the vitality of tourism, Flat Rock Playhouse tickets sales will account for a minimum of $70,000 in sales tax revenue returned to Henderson County in 2024 alone,” Bryant and Goodrum said in a 492-word letter they sent to commissioners on May 31. “A conservative projection of our broader economic impact at merely half the $10M estimated by past travel and tourism studies, is an additional $100,000 annually (in sales tax revenue). Therefore, in local sales tax revenue alone, your annual return on investment (from a $30,000 grant) is more than 5:1.”

Bryant and more than two dozen Playhouse supporters remain mystified that Andreotta brushed off the chance to hear from them directly.

“We looked forward to having an opportunity to converse with him,” Bryant said, “and he chose instead a one-sided pontification and decided that he didn’t actually want to have a public or private conversation. We have still yet to hear from him directly. … I feel like his intentions were maybe slightly dishonest, considering he made a huge point about feeling morally convicted to speak with us and then never did either privately or publicly.”

Playhouse grants v. corporate grants

Andreotta implies, in singling out four nonprofits that are receiving grants in the FY25 budget, that either they don’t need the money or that they’re paying too much in salaries. Yet he utters no objection to the $2,097,190 in economic development awards the FY25 budget grants to manufacturers for choosing to locate or expand factories in the county. These are tax breaks commissioners adopt with exuberant pride. And speaking of nonprofits, the county this year will write a $434,000 check to the Partnership for Economic Development, the agency that recruits industry.

Profits are a good thing, we would assume Andreotta believes, when corporations rack ’em up.

Conversely, he describes the Playhouse as “a $4.2 million generating revenue enterprise that is able to qualify as a nonprofit because of their connection to the Vagabond School of Theater. Nothing wrong with that,” he says

Yet, as a result, “They own $2.6 million in real estate, which they do not get a tax bill on,” he says. “Their property taxes per year would be $11,263 and their fire tax, because they’re in a volunteer fire district, would be $3,380. So that’s $14,643. Sixty-four percent of their revenue goes to salaries.”

Guess who else doesn’t get a property tax bill? That would be the 10 manufacturers that the county deems has met their commitment to pay above average salaries and benefits. (Duration of the tax breaks is generally seven years.)

Based on company records we reviewed, the companies Andreotta is happy to subsidize offer some handsome pay packages. Here are four, with the amount the corporations are getting in property tax givebacks in parentheses:

• GF Linamar ($1 million): Linda Hasenfratz, executive chair/CEO, earned $675,000 in base salary plus $9,854,038 in corporate profit bonuses and owned Linamar stock valued on March, 2023, at $362,405,320, according to the company’s report in March 2023 on its March 2022 shareholder meeting.
• Jabil ($103,224): Mark T. Mondella, director and CEO, earned base pay of $1.255 million and total compensation $16.6 million. according to Jabil’s proxy statements for FY2023.
• Kimberly Clark ($34,461): Board Chair/CEO Michael D. Hsu earned base pay of $1.47 million and $16.5 million in total compensation in 2023, according to the company’s proxy statement.
• Gaia Herbs ($53,239): The “most compensated executive makes $720,000 annually,” according to comparably.com.

‘Quasi-county departments’

Andreotta pontificates onward: “To me, when we give out taxpayer money, that recipient, whomever it is, they become somewhat of a quasi-county department. So it’s an organization that we’re partially funding with your money. Probably most of the time, we’re contributing to supporting the payment of their staff.”

GF Linamar, Kimberly Clark, Jabil and other corporations would be surprised to learn that they became “departments” of Henderson County when Daniel Andreotta and his colleagues voted to “give out taxpayer money,” in the form of property tax refunds.

It would come as a surprise, too, in the board room of the Partnership for Economic Development, if commissioners objected to a corporation’s making a profit and devoting a large share of the net to salaries and benefits — considering that the whole point of the tax refunds is to incentivize good-paying jobs.

Ever focused on the trees and thus blind to the forest, Andreotta shades the three commissioners who cast the gutsy vote to greenlight the courthouse-jail expansion.

“I view this as a subsidy to a revenue-generating enterprise,” he says of the Playhouse grant. “We’re not helping a ‘help organization’ stay afloat for necessity service. And all of this has skyrocketed in urgency in my mind since — not with my vote — we put the citizens of this county $150 million in new debt. That’s $15 million a year that’s not going to go anywhere else. So I think between now and our next meeting in June, I would encourage us to look at those things carefully.”

We just did. You’re welcome.

From our careful, two-sided look, the county’s $30,000 grant to the State Theatre of North Carolina is not only worthwhile. It’s a small vote of confidence, and nod of appreciation even, for an enterprise that not only returns five times more than that in direct tax dollars but also educates and entertains our schoolchildren, stands as a star attraction to draw visitors, remains a key contributor to our brand and proves to be a powerful piston in the engine that drives tourism.

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County commissioners are scheduled to continue discussion of and adopt the FY25 budget when they meet at 9:30 a.m. Wednesday, June 19. For updates visit hendersonvillelightning.com.