SIFF Downsizing FAQ

What is happening?
SIFF is downsizing and restructuring in order to remain open and continue to deliver on its mission. SIFF has continued to struggle financially post-pandemic and revenue has not kept up with our expenses, specifically fixed costs, including staffing, rent and mortgage payments, insurance, and ongoing maintenance.

How did this happen?
SIFF has been in a challenging financial situation since emerging from closure during the pandemic in 2021. SIFF, along with many non-profit organizations, benefited from some pandemic-related financial support through grants that sustained SIFF’s ability to continue operating. By 2023, all pandemic relief support concluded. Revenue has continued to lag year over year since the pandemic and inflation has contributed to drive SIFF’s costs up. We have also observed the impact of inflation and economic instability driving a decline in general audience attendance at cinemas nationally and a decline in the ability of our donor base to contribute at pre-pandemic levels. SIFF began cutting expenses in the summer of 2024 in order to address mounting non-affordability, and built a 2025 budget with expenses significantly reduced. Unfortunately, as cinema revenue over the first four months of 2025 fell far short of established goals, it became clear that more significant cuts to our fixed costs were necessary in order to remain open.

Who will be impacted by this change?
There will be a reduction of administrative staff by 9 full time roles. All staff will be impacted as this will require a downsizing of SIFF’s activities overall, including a reduction in hours for all hourly Unionized staff and projection staff. Staff who are being let go were informed on Tuesday, June 3rd that their last day is Friday, June 6.

SIFF is downsizing 21% of its full-time staff. What cost cutting measures were taken to avoid this? Were there any other options considered before deciding on layoffs and hour reductions?
SIFF leadership has been addressing the need to cut expenses in an intensive way since the summer of 2024. Over Q3 and Q4 of last year, SIFF reduced administrative expenses on our fixed recurring costs to retain essential services only. This included a 12% reduction in staffing costs through restructuring of existing roles. SIFF also eliminated some staff technology support services, tools and software, renegotiated contracts with some vendors for lower prices and changed vendors in some cases to decrease costs by as much as 20%. While the impact of these reductions were helpful, income and overall financial performance over the first four months of 2025 demonstrated the further need for expense reduction and cuts.

Could we have worked harder to avoid this?
As there are contributing factors that are beyond SIFF’s control, including inflation, economic volatility impacting audience and donor behavior, SIFF exhausted all options within our control to reduce fixed costs as much as possible to align with our actual revenue, before exploring staffing reductions. It is important to be clear that these reductions are not in any way linked to staff performance concerns - all SIFF staff have been doing tremendous, above and beyond work.

SIFF acquired the former Seattle Cinerama in 2023. How has that acquisition impacted SIFF financially?
There was significant financial support from the city and county, along with a private donor, that supported SIFF’s ability to acquire, reopen and begin operations at the former Cinerama. At the time when SIFF acquired the former Cinerama, we did not have the same non-affordability challenges, and our initial revenue projections, rooted in Cinerama operational data, supported a favorable outlook for revenue generation at SIFF Cinema Downtown.

But the annual film festival appeared to perform so well this year, why doesn’t that help?
Despite the fact that the 2025 festival budget cut expenses significantly in line with the cost cutting measures included in the 2025 SIFF annual budget, the annual film festival typically does not generate revenue, and certainly not on a scale to address the revenue gap our current cuts are targeted to address. High attendance at the annual film festival supports offsetting the cost of producing the festival, but does not sustain SIFF’s year-round revenue. The festival budget amounts to about 12% of SIFF’s annual budget.

How has the closure of Egyptian impacted this decision and will reopening Egyptian just add more burden to SIFF?
While the closure of SIFF Cinema Egyptian has impacted SIFF’s ability to generate revenue overall, the non-affordability challenges that SIFF is addressing with these staffing reductions are of a much larger scope than Egyptian revenue would have been able to address or resolve. The closure of SIFF Cinema Egyptian was not driven by our financial sustainability challenges nor was it a result of them. It is unclear at this time how these reductions will impact the path to reopening, as SIFF will have less capacity overall to manage the reopening project.

Is SIFF expecting a loss in any grant or sponsor funding over the next 1-3 years? Have projected losses in funding impacted this decision?
We are in an unpredictable environment on many fronts, and we do not yet know what trends we can expect to see in terms of future contributions, grants, or sponsorships. SIFF continues to have support from philanthropically-minded individuals, foundations, and companies, alongside more local sources of government support. Historically, however, the economy always impacts contributed income. We will continue to work diligently to tell our story in the community and seek new funding opportunities, and we continue to be deeply grateful for the support we receive. As we develop the budget for 2026 and beyond, we will continue to be mindful of the realities on the ground as they relate to contributed income.

How will this affect my experience at SIFF in the cinemas?
This will be a challenging period for SIFF to continue its mission-driven work, and we will do our best to sustain the experiences that movie-goers come to SIFF for, and potential impacts to movie-goers in our cinemas is undetermined at this time.

I have made a gift to support SIFF and yet this is happening? How can I be sure that my donation is a good investment at this time?
As a nonprofit, SIFF receives about 40% of its revenue from donations made by individuals, memberships, government and foundation grants, and corporate sponsorships. These are vital to SIFF because ticket sales and concessions alone cannot cover all of SIFF operating expenses. A donation right now is more important than ever, as we continue to try to grow the base of philanthropic support and provide a diverse and more stable source of income year after year. Donations are vital to SIFF’s short and long term success and we are grateful for that investment in SIFF’s future.

I’ve heard about grants and donations that SIFF has received recently, why isn’t that enough?
SIFF, along with other local nonprofits, has received generous funding from 4Culture through the Doors Open program, for which we are deeply grateful. We continue to work to find as many grant and donation opportunities as possible and our total contributed income (including these large gifts and grants) make up about 40% of SIFF’s total revenue. Some of these gifts are for specific purposes and are restricted in how we may use them, so they cannot cover the costs of staffing, or administrative overhead, for example. Most of our daily/monthly expenses require unrestricted general support, which can be more challenging to secure.

Even with these successes, we are currently experiencing an unstable situation in our country for arts and nonprofit support. There has been a national trend of decreasing donations since the highwater mark of the COVID-19 pandemic, and the uncertain economic situation makes it difficult to determine future giving trends. SIFF continues to cultivate our relationships, share its mission with funders and donors and we promote our mission to help it remain hopeful that it will resonate with our audiences and supporters.

How did the NEA grant terminations affect SIFF and is this part of the issue?
NEA funding for the 2025 Festival and our Education programs is one piece of the larger picture of government support at SIFF. While we have made a request for funding for 2026, given the current circumstance we have low confidence in any award for next year. SIFF continues to work to find other funding sources to replace any lost revenue from the NEA. We are deeply concerned about the larger impacts of the withdrawal of federal money for the arts and nonprofits and the downstream effects that we are yet to see.