The financially troubled August Wilson Center for African American Culture laid off about half its staff on Friday and is searching for a way to continue operating.
The center is behind in payments on a $7 million loan and told employees it did not know when they might be rehired or how many might come back, said Aaron A. Walton, chairman of the board of directors.
"We have to take a step back and look at the business model we're using and decide what's going to be sustainable," Walton said.
The center laid off eight to 10 of its 20 or so employees, Walton said. Interim Chief Executive Officer and President Oliver Byrd notified employees during the week of the layoffs, which started on Friday.
The August Wilson Center's sailboat-shaped building on Liberty Avenue stands out among Downtown architecture. Inside, two main exhibit halls and five gallery spaces display art that reflects the culture and history of blacks. Its 486-seat theater has hosted dance and musical performances.
The center will reduce some of its summer programming and likely will end free admission to the center's general exhibitions and facilities, Walton said. The center charges for special exhibitions on the second floor.
"The days of blanket, free admission are over," Walton said, adding that the center will keep free admission for those who cannot afford it. "You can't sustain any organization with free admission."
The center's budget has come largely from donations, grants and money from publicly funded groups. Walton said the center must find other ways to generate revenue.
The past several years have been financially rocky for the center, which opened on Liberty in 2009 and is named for Pulitzer Prize-winning playwright August Wilson, who was born in Pittsburgh. It ended fiscal 2010 with an $856,907 deficit because of debt it issued to cover cost overruns on the building's construction and a funding shortfall.
In January, the center secured funding to restructure and reduce its $11.2 million capital debt to $7 million, including a $2 million loan the Pittsburgh Urban Redevelopment Authority approved.
Walton said the center is behind on payments, but the bank has not sent letters of default.
"They continue to be a challenge," Walton said of the debts.
Reached on Friday evening, Yarone Zober, chairman of the URA's board of directors, said he was not aware of the layoffs. The URA loaned the center money to invest in an important asset, Zober said.
"It's an important symbol of Pittsburgh's heritage. It provides a great venue for arts organizations, not for just Pittsburgh, but for artists worldwide."
Zober did not know the status of the $2 million loan. No one else from the URA was available to comment.
The Allegheny Regional Asset District, which supports libraries, parks, stadiums and cultural groups with half the proceeds of an added 1 percent sales tax in Allegheny County, increased its funding of the center this year to $300,000. It could not be reached for comment.
Andre Kimo Stone Guess, the center's former chief executive officer, stepped down in September. Walton said the search for a new CEO and president has been put on hold until the center settles on a business model going forward.
This article was written by Channel 11's news exchange partners at TribLIVE.