STEVE WELLS is the last president of the Fly by Night musicians club, overseeing its liquidation after a tumultuous three years of mushrooming debt. He has a look at exactly what went wrong once the Fly was kicked out of its long-term home at the Drill Hall by its landlord, the National Trust.
THE Fly by Night Musicians Club has existed in Fremantle as a music venue for 32 years.
It commenced as an idea for a short-term entity at the Drill Hall, promoting live independent and local music, but continued due to its popularity and went on to become a Fremantle icon.
The Fly has always been run by a voluntary board of directors who receive no remuneration for managing it on behalf of members.
Since moving to Victoria Hall in 2015, the Fly has built on the foundations established at the Drill Hall, hosting up to four events per week in the Main Hall or the Fly Trap.
The club provided a springboard for many emerging artists, a low cost venue for community groups and a much-loved source of entertainment for Fremantle audiences.
The move to Victoria Hall four years ago created major challenges for the Fly.
Although the club was debt-free at the time of the move, obtaining a liquor licence took 14 months, resulting in a severe curtailment of the types of shows and expected revenue that could be obtained during this time.
Despite a stepped rental agreement which allowed for gradually increased payments after the liquor licence was in place, the Fly continued to incur losses due to its initial incapacity to get the required bookings and audiences without a liquor licence or long-term lease, and a widely held perception that the Fly had “died” when it exited the Drill Hall.
In addition, the lease from the city of Fremantle required the Fly to be open to the public at least three nights per week, however under the liquor licence, the bar could only be operated when shows were on.
This meant that the Fly had to put on many smaller events, most of which broke even at best. As a result of these factors, total debts increased rapidly and while the number of events hosted increased significantly during 2016, earnings were not sufficient to simultaneously clear the earlier losses and continue to fully pay the rent and outgoings as per the lease and ongoing costs.
In 2018, in recognition of its deteriorating financial position, the board, with the agreement of the major creditors, sought to change its business model with a view to substantially reducing fixed costs and a focus on large acts only, however the difficulties in acquiring future bookings remained.
Facing the prospect of further reductions in earnings, the board agreed in mid-October that it had no alternative but to wind-up the business, and all staff were made redundant from October 31, with the volunteer board members taking on all aspects of the management.
On November 28 this year, the Fly was officially placed into Receivership with its affairs to be wound up by a professional Liquidator.
Cost to the City of Fremantle
There have been claims by the council that the non-payment of rent and rates and other expenses has cost the city of Fremantle around $115,000 to date.
Apart from the written off rent and outgoings, the other costs incurred by the city in relation to the Fly have been stated as $5,000 for an economic viability study, sound attenuation at Victoria Hall of $20,000 and a grant of $10,000.
The board of the Fly believes that this is a vastly inflated view of the actual costs and lost revenue for the city.
The Fly had paid rent until the time it faced rental stress in early 2017, at which time it advised the Mayor and council officers of the situation.
The unpaid rent since then does not represent an actual cost to the city but potential revenue not realised.
Without the Fly being in the building, it is likely that very little revenue would have been generated for Victoria Hall.
Given that the building had not been used or leased after the departure of Deckchair, it probably would have remained vacant and subject to potential vandalism as a result.Furthermore, the rent charged was based on unsubstantiated “market rates” and despite repeated requests, the council has not explained how these were determined, or even how they could have been estimated given the unique nature of the property. Accordingly, it is far from certain that the amount cited in communications from the council would have been realised.
Given the above, rather than costing the city $115,000 since being at Victoria Hall it would be more realistic to say the Fly has cost the city very little in real terms. The cost is far outweighed by the value that the club has provided to the city of Fremantle over the last 32 years in the form of cultural, tourism, employment and social benefits.
These benefits have only been achieved through the passion and hard work of unpaid volunteer members of the community (board members) who, in good faith, have only wanted to see arts in Fremantle thrive.
The moral question now, is, should these members of our community shoulder the financial burden without any help from the council and community?