Party's moving to Granville Island. Photo courtesy: Vancouver International Children's Festival. The Vancouver International Children's Festival is facing perhaps the toughest year ever in its 32-year history. Provincial and federal funding have been sharply cut, despite the festival's decades of success. As festival board chair Paul Dumontet said in a recent email to supporters, "Over the past 12 months, we have developed a new vision for the Children's Festival that we believe will restore our position as one of the world's leading events for young people. "Sadly, over that same period of time, our government funding has been slashed by some $200,000, creating a serious cash flow problem that threatens our ability to implement our new vision. We need an influx of cash and we need it now." This is a sad turn of events for a festival that started on half of a $40,000 budget in 1978 and brought an estimated $23 million into the Vancouver economy by 1990. The founder, Ernie Fladell, had run the Habitat Forum event as part of a UN conference and actually made money. He persuaded Vancouver City Hall to put the profits into a children's festival and a folk festival. In the process he created two events that Vancouverites have literally grown up with. Fladell's philosophy for the kids' fest was simple: "Kids often don't know the difference between good or bad performances. We figured we'd just give them the good stuff." By the time he retired from the executive director's job at the festival in 1992, Fladell had seen the concept spread to almost 20 venues across Canada and the U.S., and as far away as Scotland. Acts recruited for Vancouver could then go on a circuit for the rest of the summer. Curious to know why the festival has fallen on hard times, The Tyee held phone and email interviews with Dumontet and with Katharine Carol, the festival's artistic and executive director. This is what they said: On the reasons for the move to Granville Island: Dumontet: The reasons aren't purely financial. The board realized the festival had stalled in attracting its audience. Artists don't make shows for the festival any more; our technology is old. Carol: The decision to move the festival was made with great deliberation. Granville Island is a vibrant, creative hub and home to numerous cultural festivals and events. Financially, the cost of building the entire [Vanier Park] site has become prohibitive, and in a climate of funding cuts it became important to scale back the festival as much as possible without affecting the presentations. The move to GI allows us to present more theatre and technically challenging shows, but also to present the companies' full production, meaning proper use of lighting and any technology they have incorporated such as the use of black light, which requires a complete blackout. On what the festival will offer: Carol: We will be scheduling fewer shows than at Vanier -- nine to 11 instead of 14 to 16 -- because we have less capacity. But we are looking at more theatre and intimate shows that work well in indoor venues. There are fabulous shows planned for 2011 and there will be site animation, new workshops and activities, a world music and dance stage, and some new exciting participatory events. Dumontet: We're still going to entertain 40-50,000 kids in eight days. On savings from the move: Dumontet: Tents have absorbed 30 per cent of our budget. Carol: We have cut our production budget by at least 40 per cent, and we have decreased some of our administration costs, so we are now working with a very learn budget. On impact of the funding cuts: Dumontet: The federal government cut their contribution by $100,000 in 2009. That was a 50 per cent cut from what they'd given us. Carol: The combined cuts in federal and provincial funding are $200,000, which is roughly 15 per cent of our $1.4 million budget. The cut from Heritage Canada was over and above the across-the-board cuts to the arts in B.C. A reduction in funding from Heritage was expected, but it turned out to be significantly larger than anticipated, and the timing was tricky because the 2010 festival was already programmed. The cuts from the B.C. Arts Council and Gaming are the same as for all other organizations. However, the timing is particularly difficult for us in terms of cash flow. We are a one-a-year event that must pay the bills for each year's festival in late summer and early fall, as the bills come in. Once the festival wraps up in May, we have no additional income until our grants and sponsorship dollars click in the following year, typically late winter and early spring, and until our tickets for the next festival go on sale. On problems with future funding: Dumontet: The provincial government has revised the formula for gaming grants. We're not sure we'll qualify for it. Carol: Under the new regulations, we are unclear as to whether professional arts organizations can apply for funding, even if they produce work for children, so we are waiting for clarity around this. On other funding sources: Carol: We have raised approximately $10,000 over the past year in private donations, and our overall goal for fundraising is $250,000. Dumontet: If each of the people on our mailing lists were to donate even as little as $10, we would reach our goal over the next two months. Asked to explain the reasons for the federal funding cut, a spokesperson for Heritage Minister James Moore told The Tyee: "The festival got $90,000 dollars in funding from the department of Canadian Heritage this year. "As you know this amount is lower than what they received in the past and there are two reasons for it. First, the program under which they applied, the Canada Arts Presentation Fund, is over-subscribed (i.e, demand for CAPF funds exceeds the amount available) and second, in their analysis, the officials at Canadian Heritage found that the festival didn't meet the criteria that would justify further funding. "I should also point out that the $90,000 received by the festival remains the 10th highest Canada Arts Presentation Fund supported organization in B.C. (and the Yukon)."