City looking at option to filter donations to community theatre society

In the ongoing saga to bring a theatre to Merritt without using city money and raising taxes, the Nicola Valley Community Theatre Society and City of Merritt may team up to facilitate donor money.

The non-profit society wants to build a theatre and performing arts centre downtown, and submitted an application about four months ago to the Canada Revenue Agency (CRA) for charitable status.

However, to date the CRA hasn’t responded to the society.

Nicola Valley Theatre Society director Rich Hodson said he expects to receive an answer from the agency next month.

If unsuccessful in obtaining this status, the society is asking the city to collect donations on its behalf so that those who want a tax receipt when donating to the theatre project can receive one.

“We have several large donors that would like to give us money, but they need a tax receipt before they’ll do that,” Hodson said.

Without charitable status, the theatre society cannot issue tax receipts itself.

A council report on the matter submitted as information for the Jan. 12 council meeting states that municipalities are considered qualified donees by the CRA, giving it the ability to issue tax receipts for donations that meet the CRA’s charitable donation criteria for charities.

The city can act as a charity and collect the donations, issue receipts and give the funds to the society — even though the society isn’t a charity — as long as it maintains control and direction over how the money is spent.

City of Merritt financial director Sheila Thiessen said the money can’t be handed over unconditionally.

If council approved this course of action, an agreement would need to be established between the society and the city outlining criteria to be met before the collected funds could be transferred from the city. City staff would also need to determine a portion of the project to fund that aligns with the municipalities mandate and draft an agreement as to how and when the funds would be disbursed for council approval.

“Lots of municipalities do fund theatre spaces,” Thiessen said, noting the city doesn’t want to commit public money to the project, so this option is one way to help in lieu of that.

Essentially, those who make a donation under this potential arrangement would be donating money directly to the city, Thiessen said.

In the event the theatre project didn’t go through, the City of Merritt would have a windfall of donation money to spend on a similar cultural initiative.

The proposed four-bay theatre would be a hybrid model with three movie theatres with paid staff combined with a community performing arts theatre.

“If you were strictly a business, you probably wouldn’t qualify for CRA’s [charitable] status, but if you have the community theatre, which is for the good of everybody in the community, then you may qualify, but we don’t know yet and we have to wait and see,” Hodson said.