From the press release:
The Art Theater Co-op Looks to Merger with Local Foundation
Champaign, IL – May 1, 2017 – The Art is asking its 1,300 owners to approve a merger with the Art Film Foundation, transitioning the Theater away from cooperative ownership and to 501(c)(3) tax-exempt status. In 2012 the Art Theater became the only cooperatively owned movie theater in the country, a move that facilitated the purchase of a new digital projector and allowed the Art’s doors to stay open. But as a co-op, the theater cannot raise tax-deductible funds from individuals or foundations—funds it critically needs.
As a cooperative, active owners must vote to approve the merger. Voting will take place from May 2nd-May 20th via electronic ballot, which will be e-mailed to all owners on May 2nd.
“Almost all of the most successful art house theaters in the country are tax-exempt charitable non-profits,” says Austin McCann, the Art’s General Manager of five years. “Cooperative ownership was a the critical factor that allowed the Art to remain in business in 2012, but to move forward and continue to grow, we need to change again.”
The Art Film Foundation (AFF) is a Champaign-based 501(c) 3) tax-exempt charity founded in 2015 whose mission is to promote culture and education through film and cinema. The merger would make the Art a program of the AFF thus allowing the Theater to gain the benefit of the AFF’s tax status. “Programming, membership, special events, community participation, and the Art’s amazing staff—all of this stays the same,” said Alicia Kozma, Board member of the Art. “And with the ability to raise tax-deductible donations and grants, the Art can grow and flourish long into the future.”
Under IRS rules, charitable organizations cannot be “owned” by individuals. Therefore, the merger requires the dissolution of the ownership pool. At a meeting on April 29th, the current owners talked about their desire to maintain a voice in the direction and vision of the Theater. Among the alternatives presented, owners favored most a plan that would give individuals with annual memberships a voice in selection of some of the Board of the newly merged entity. “The Art will always be a community theater. The last thing Board members or I want is to disempower community voices in the Theater’s life,” says McCann.
Full information—including a FAQ, Fact Sheet, Proposed Merger Plan, and other documents—on the proposed merger can be found at http://www.arttheater.coop/
Leigh Estabrook, President
The Art Theater Co-op
126 W. Church Street