2019-12-10 Services & Organisation Committee Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                              10 DECEMBER 2019


3.    Financial Operations January 2016 – June 2019
Prior to 2006, the BFAC operated under various community organisations however these often
failed due to the financial burden required to operate within a challenging heritage building, the
need to hire staff to manage this type of facility and the building constraints which limited the
ability to raise sufficient revenue. Over the last four years Council has provided an annual
operating subsidy to the CFG, as the 2015 review found that this was an effective way of
providing a sustainable community solution whilst reducing the cost burden to Council. As per
the initial agreement, the subsidy has been slightly reduced each year as the CFG have
increased revenue streams. Subsidy amounts: 2016 - $132,879; 2017 - $123,229; 2018 –
$122,080 and 2019 – $117,546.
Council’s subsidy is to assist in funding a broad range of operating costs including human
resources, administration, marketing, programming and telecommunications. Operating costs such
as water, electricity, security and major building maintenance have remained Council’s
responsibility during the permit period while other costs have transitioned to the CFG.
The subsidy is significantly less than what it would cost Council to directly manage the facility
primarily due to the CFG’s ability to raise revenue and use contract and volunteer staffing. Prior
to the transition to a community-managed model, the 2015/16 budget for the BFAC was
$236,808, including depreciation and overheads: whereas the 2019/20 budget is now $184,745.
If Council were to resume operation of the facility the annual cost would be a minimum of
$265,000, an increase of 43% over the current budget. This would also be at reduced service
levels as the cost to maintain the current weekend hours of operation would be prohibitive.
The CFG was also expected to undertake a range of revenue-raising activities to fund additional
operational requirements, deliver cultural programming and support identified capital facility
improvements. Over the last four years, the CFG has met this expectation demonstrating their
commitment to become more sustainable. Revenue for the BFAC comes from grants,
sponsorship, memberships, fundraising, venue hire, residency hire, exhibition commissions and
masterclass and workshop fees. The Artisan Store produced over $24,000 of revenue in rent and
commissions during 2018/2019.
Importantly the CFG, as an incorporated association, can apply for a range of small grants to
operate and upgrade the facility that would not be available to Council. The CFG has proactively
applied for 17 different grant funding opportunities, with 7 successful applications resulting in over
$39,000 of additional funding used to:
1.   Upgrade the BFAC kitchen;
2.   Upgrade the lights in the three gallery spaces to energy efficient LED high-bays, improving
     the visual aspects of the gallery walls and the artworks, as well as reducing their carbon
     footprint;
3.   Support the delivery of the Cooroy Fusion Festival for 3 consecutive years;
4.   Deliver a skateboard painting workshop for at-risk youth;
5.   Host a First Nations Exhibition for NAIDOC Week;
6.   Deliver an Opera Funk and associated performances for Queensland Mental Health Week;
7.   Conduct a series of Seniors Week workshops.
The CFG has demonstrated tight fiscal control during the four years of operation, ending each
year with an operating surplus.

                                Jan – June 2016         2016/2017         2017/2018        2018/2019

Income                                $79,369.70         $190,297          $212,155         $215,797
Expenditure                           $67,227.20         $148,475          $176,697         $204,443
Surplus/Deficit                       $12,142.50          $41,822           $35,458          $11,354
Surplus after Capital                          -          $37,197           $10,814          ($4,732)
Expenses


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