The letter states that the theater did not have resources to pay its staff, actors and vendors in a timely manner, and to make debt payments.

“Each of us cares passionately about professional theater in Ann Arbor, and in particular the high caliber of work Performance Network Theatre has produced over the years. At present we are engaged in due diligence as we assess the true financial situation in order to determine the appropriate next steps and decide on a course of action when the Board of Directors meets later this month.”

The theater cannot reimburse subscribers and ticket holders at this time. ”We remain committed to doing our best to determine an appropriate course of action for the mutual benefit of the theatre, staff and those owed money. At a meeting of the Board later this month, we hope to evaluate options that might allow for the continued operation of the Performance Network Theatre.”

The board members are: Ron Maurer (president), Tom DeZure, Linda Levy, Edward Abbott, Gene Dickirson, Jessica Litman, Mary Avrakotos, Steve Gerber, Stephen Palms, Barbara Bach, Hannah Goodstein, Myra Poplin, Norman Bash, David Herzig, Sheila Sassar, Tom Crawford, Steven Klein, and Philip Stoffregen.

Update: On Monday, June 9, a group of PNT supporters – including former staff – announced a proposal to re-open the theater with a smaller staff, dramatically reduced budget, and plan for reaching financial solvency. The proposal will be presented to the board at its June 18 meeting. [.pdf of June 9 press release]

According to the group’s website, the board of directors are: Ron Maurer, president; Tom Crawford, vice president; Steve Gerber, vice president; Tom Dezure, treasurer; Linda Levy, secretary; Ed Abbott; Mary Avrakotos; Norman Bash; Gene Dickerson; Joe Grimley; Hanna Goodstein; David Herzig; Steven Klein; Jessica Litman; Stephen Palms; Myra Poplin; Sheila Sasser; and Phil Stoffregen.

Seven staff members are also listed on the site: Erin Sabo, managing director; David Wolber, artistic director; Carla Milarch, associate artistic director; Logan Ricket, associate development director; Joshua Parker, technical director; Becky Fox, children’s theatre director; and Jennifer Pan, assistant technical director & graphic designer.

The press release provides no other details about the financial situation, but states that the board ”wants to thank the community, actors, directors, designers, donors, and subscribers for their long-standing support of the theatre.”

The theater was founded in 1981 and is currently located in the ground floor of 120 E. Huron St., at the southwest corner of Huron and Fourth Avenue. The building also includes Courthouse Square senior apartments.

In recent years the theater has struggled financially. In April of 2009, the theater announced that it needed $40,000 or it would close – an appeal that resulted in a rush of donations.

Update: A meeting has been scheduled for Wednesday, May 28 at 7 p.m. at Hathaway’s Hideaway, according to an event notice posted on Facebook by Carla Milarch. From the post: “Join us for an informational and brainstorming session about moving forward in the wake of Performance Network Theatre’s recent closure. This will be an info-share as well as a discussion of ideas for keeping professional theatre alive in Ann Arbor.” Hathaway’s Hideway is located at 310 S. Ashley in Ann Arbor.

But one audience question came from a voice for the “local market,” specifically the “ordinary folks who have one of these mortgages who are suffering.” “What are the techniques,” wondered that voice, “that are available to keep people in their houses? … Or do you believe that they should be out of these houses? This is a social disaster in our community.” The voice posing the question would be familiar to observers of local Ann Arbor affairs.

Linda Tesar, chair and professor of economics at the University of Michigan (behind podium) makes introductory remarks for the panel discussion, "Upheaval in Financial Markets."

The voice belonged to Jean Carlberg, currently serving on the planning commission and formerly representative to city council for Ward 3 (the seat where Stephen Kunselman currently serves and likely to be filled by Christopher Taylor in November). In response to Carlberg, panelist Peter Borish, an early ’80s UM graduate and now director of Pali Holdings, Inc., offered his view that keeping people in their houses was a “strong public policy interest.” Panelist John Sweetland, a late ’50s grad and now president of The Winsford Corp., said that while everyone liked to talk about Wall Street and Main Street, we should not forget Mulberry Street, “where people actually live.” Sweetland said that the bailout package was merely a first step and that more was needed.

The bailout package itself passed the house during the panel discussion with a vote of 263 to 171, a fact relayed mid-discussion by ’80s grad Michael Beauregard, now partner with Huron Capital Partners, LLC, who was monitoring the vote via a handheld electronic device. It validated the view expressed 10 minutes earlier by Peter Hooper, a ’70s grad and now chief economist with Deutsche Bank Securities, who had declared, “It will pass. I said it last week and I’ll say it again. It will pass.”

In response to a question about the possibility of the $700 billion bailout having an inflationary effect due to an increase in the money supply, panelist David Berson, former chief economist with Fannie Mae, began his answer cautiously. He wondered if one of his doctoral qualifying exams from the early ’80s might hang in the balance and be retroactively rescinded. A gentleman in the front row, presumably a member of Berson’s PhD committee, nodded, but in a way to suggest he was kidding.

Near the beginning of the proceedings, Berson had provided a bit of non-verbal comedy, when he concluded his brief intro of himself with “former chief economist with Fannie Mae” and let the hint of a grimace cross his face, then gingerly passed the microphone to the right. But with one hand holding the mic, Ralph Heid, an early ’70s grad and now vice president with Comerica Bank, used the other hand to pat Berson on the shoulder, saying, “Timing is everything.”

So will the $700 billion have an inflationary effect? Nobody seemed to think so. For one thing, the money is not a “transer of funds,” but rather the “purchase of assets” – the questionable mortgages that were backed by various venerable financial institutions. It’s not an increase in the money supply. Instead, it amounts to a temporary increase in liquidity, which the Fed needs to monitor to make sure that it steps in at the right moment to decrease liquidity. If it steps in too late, that could lead to inflation. Right now, though, gold is still outperforming silver, which is indicative of a non-inflationary environment. Without this increase in liquidity provided by the bailout, credit would remain frozen – right now banks are not lending each other money even overnight. And the effect of that will soon begin to be felt by non-bankers, namely people trying to get car loans or student loans.

In fact, the expectation is that deflation, not inflation, will predominate, and Peter Borish pitched that to the assembled young students in the auditorium as boding well for them (in part, because it gives them easier access to retail goods), but not so well for folks who were looking to retire at age 55 and circle the globe on their amassed wealth. Panelists spoke of the bailout having only a very slow effect and everyone seemed to think that the country can expect to experience at least a moderate recession.

So how are those “ordinary folks” who own a mortgage they can’t afford supposed to navigate through the recession? One panelist stressed that we need to make sure they had jobs. No concrete ideas were brought forth on how to do that.