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Pandora’s digital box: Harmony

Monday | March 26, 2012   open printable version open printable version

DB here:

I had thought I was finished with my series on digital projection that started back in December. That was before a late-night trawl of the Internets brought the JEM Theatre to my attention. Sometimes reality has a taste for a dramatic story, and this was one I couldn’t resist.

So I went to Harmony.

 

All in the families

A birthday party at the JEM Theatre.

For decades exhibiting movies has been a family business. Many regional chains were founded by fathers and brothers and staffed by sons, daughters, and in-laws. The Midwest’s Marcus chain of 700 screens originated in 1935 with grandfather Ben and is run by son Stephen and grandson Gregory. More modestly, Smitty’s Cinema, a nine-screen movies-and-eats circuit in Maine and New Hampshire, was the brainchild of three brothers.

The smaller the venue, the more likely you’ll find a family in charge. The Goetz Theatre of Monroe, Wisconsin, which I profiled earlier, has been in the family from the start. The single-screen Cozy in Wadena, Minnesota, has been run by the Quincers since 1923, with the founder’s great-grandson in charge today. Dirk and Jeri Reinauer have the Sunset Theatre in Connell, Washington. Tom and Barbara Budjanek, who bought Pennsylvania’s Ambridge Family theatre in 1967, are still running it in 2012.

Families pass theatres to each other. The venerable Roxy in Forsyth, Montana, was bought by a couple in 1967. They sold it to their projectionists, one of whom kept it going with his wife. (The theatre went digital in 2010, just in time for its eightieth birthday.) From 1947 to 1959 the Wayne Theatre in Bicknell, Utah, was operated by a husband and wife. Another couple bought it and ran it until 1994, when they sold it to a third husband and wife. A fourth family acquired it in 2008.

The record for husbands and wives running a single-screener might be held by the little town of Harmony, Minnesota. The JEM Theatre on the main street, closed in 1947, was reopened by Bob and Hazel Johnson in 1961. They ran it for twenty-five years. It passed through the hands of five more couples before Michelle and Paul Haugerud acquired it in 2002.

Paul and Michelle met in San Francisco, where Michelle was working for Bear Stearns and Paul had served in the Navy. In 1994 they moved to Harmony to be near Paul’s family. There they raised six children while Paul started a paint and drywall business and Michelle began a career in Web design. “When we bought the theatre,” Paul explained, “we knew it was gonna make no money. We knew it was gonna be basically like doing community service.”

To an extent that people living in cities and suburbs may not appreciate, the JEM has held a central place in the life of the town. By 2011, digital conversion threatened to end that.

 

Harmony, not far from Prosper

With a population of about a thousand, Harmony sits in farm country close to the Iowa border. As Prairie Home Companion reminds us every week, people of Norwegian descent are found all over Minnesota. What you may not know is that certain areas are also home to Amish communities. Waves of migration made Harmony a center of Minnesota’s Amish culture. Local businesses serve the five hundred households in the town, and tourism brings in some income too. One of the big attractions is Niagara cave, containing fossils pre-dating the dinosaurs. There’s also a major biking trail and a fall foliage tour.

The JEM was named, supposedly, for the first letter in the names of the original owner’s three children (but see the PS below). It  helped knit the town together, and under the Haugeruds it became a unique institution.

They made a solid team, with Paul’s expertise in carpentry and engine repair matched by Michelle’s money-management skills. Paul, with no previous theatre experience, learned to thread up the platter projector. “The first few weeks, I would literally sit there with sweat rolling down my face as I pushed the start button. I’d be so nervous I did something wrong.” Paul introduced screenings with announcements and jokes. The Haugeruds knew most of their patrons, but at every screening there were fresh faces from nearby towns in Minnesota, Iowa, and Wisconsin.

The JEM screened only on weekends, once each day at 7:30. Paul’s and Michelle’s day jobs made any other schedule impossible. During football season, Fridays brought in few teenagers, but Saturdays were better and Sundays were quite good. Overall, the 200-seat house averaged around 55 each night. On snowy nights, a few souls still braved the Minnesota winter to come see a movie.

The Haugeruds ran the JEM as a family business. There was no paid staff. The Haugerud kids sold tickets and snacks and helped with cleanup. Friends and volunteers came out as well. Michelle made the pre-show video slides of ads for local businesses. Even with low overhead, the theatre barely broke even. All tickets were $3. “We’ve always kept prices low,” Michelle explained, “so families that are financially hardshipped can still get their kids out of the house.”

Most of the JEM’s programs were subruns—movies that had opened nationally two or three weeks before. To avoid courier service costs, Michelle and Paul would make midnight drives to pick up prints from other towns. “I’d call and they’d just be breaking down their print from their last show on Thursday,” she says. “I’d say, ‘I’ll be there in fifteen minutes,’ and at midnight I’d go get the print for Paul to make up on Friday.”

Snack concessions are the core of every theatre’s income, but even here Paul and Michelle offered deals. They priced their candy at a dollar and a big tub of popcorn at four bucks. Soda was sold in plastic bottles, to allow for recycling and to keep costs down. Instead of getting concession items from theatre suppliers, Michelle bought them in bulk at Sam’s Club.

The JEM popcorn developed a following. High schoolers came to pop and bag it for football games. Paul and Michelle encouraged people to bring their own buckets to be filled with corn at a fixed price; some people showed up with shopping bags. The Amish didn’t come to the films, of course, but on some days you could see a horse and carriage lingering outside while the driver was buying a supply of popcorn.

The Haugeruds were generous with free passes as well. Over the years, they have donated hundreds of free passes to help local organizations raise money. At other times, Michelle realized, passes are a good form of marketing. “Give out one, and three more people will come along to pay.”

The JEM wasn’t just for movies. Youth groups held meetings there. Many local kids had their birthday parties there, accompanied by a movie or a videogame. The Haugerud daughters had slumber parties in the auditorium; after a movie, they settled down, if that’s the right word for a slumber party, in sleeping bags down front and in the aisles.

Many in Harmony believed that the JEM brought business to town. Julie Barrett, owner of the Village Square Restaurant across the street (and famous for her daily pies) said, “When people go to the movie, they stop at the Kwik Trip, our hardware store is open until 6:30, so you know they might try to kill two birds with one stone when they come to town.”

Over the situation hovered the fate facing every small town—the hollowing out of the center by the big-box stores down the road.  Pull off any interstate highway, and you’ll see that the main streets of small towns have turned into empty storefronts, municipal offices, or struggling boutiques. When the JEM faced the need to go digital, Paul was concerned. “If we take one more thing away it’s going to hurt the community. I’m scared to death that main street is going to look like Harmony in the 1980’s when I was growing up. It was pretty bare.”

 

Single-screeners

Tonja Lawler selling tickets, Michelle Haugerud selling concessions.

The major distributors and the National Association of Theatre Owners now seem to take for granted that thousands of screens will close over the next few years. Some will fail to convert; others will struggle to pay for the conversion but still fold up. What are the likeliest victims? Those at the bottom of the food chain, the single screens and the “miniplexes” holding between two and seven screens.

These two categories account for over half of all exhibition sites in the US. But they amount to only a small slice of the total number of screens, which is what matters. And the number of small houses is shrinking. During the bankruptcy convulsions of the 1999-2001 period, circuits shed hundreds of screens. Since 2007, the total number of U. S. screens has remained fairly constant, but multiplex and megaplex installations have swollen by 2000 screens. Smaller facilities have lost about the same number—by going out of business.

Hollywood, people like to say, doesn’t want to leave money on the table. But more and more the long tail is a waste of resources. Why bother to prepare and ship a DCP to a theatre that yields a box-office take of less than $300 per day? Many decision-makers among the major distributors would be just as happy to let people in small towns wait a couple of months and catch the film on VOD or disc (rented from a gas station, since the video stores are gone too). As long as the megaplexes publicize the must-see movies, people will know what to buy or rent or stream. If you live in the countryside and you really feel the urge to catch the latest hit, get in your car or pickup and drive an hour to a ‘plex. No vehicle? Too young to drive? Wait for the video.

While digital projection allowed the major distributors to consolidate their power, it also offered a way to streamline and downsize exhibition. The 1600 American single-screen venues are especially vulnerable. For the industry, it seems, any part of film culture that preserves some history or takes root in a community is simply a nuisance. Michelle Haugerud puts it simply. “They don’t care if we go out of business.”

 

A digital jug

In late spring of 2011 Paul and Michelle decided to try to go digital. A new projection system and sound processor would cost $75,000. “We’ve tried to run it by ourselves and keep it independently owned, but it’s gotten to the point now where we’re looking for some help,” Paul said in July. “It was a difficult decision to ask for the community’s help,” Michelle wrote on her website. “We never wanted to ask for support, but we knew the public deserved to know why we may have to go out of business.”

They began a fundraising drive. A young patron named Kirsten Mock decorated an old red juice jug for donations and put it on the candy counter. Paul and Michelle set up a designated savings account with a local lawyer’s name attached to make sure people understood that any donations would go only to the projector. A list was kept of all who put their names on donations, and the money would be refunded if the target sum weren’t reached.

The problem was that the JEM, privately owned and operated, wasn’t a nonprofit. Donations were not tax-deductible, and local government agencies couldn’t normally supply grants or other aid. During 4 July celebrations, however, a “Harmony Goes Hollywood” event featured a room in the Historical Society set up with an old projector and theatre seats, with clippings and photos showing the JEM over the years.

A local woman tipped Twin Cities media to the campaign. It was good timing: The US press was starting to notice the nationwide digital conversion. News outlets and TV stations covered the JEM’s crisis. Minnesota Public Radio picked up the story.

By fall, when the campaign had raised about $7200 locally, Paul and Michelle found a nearly new projector for $55,000. They managed to borrow the $48,000 they needed from a local bank. By shouldering the loan themselves, they showed the public that they were committed, and this gesture boosted donations.

As a result, on 11 November, the JEM screened its first movie on the Digital Cinema Package format, Dolphin Tale. On that weekend Paul thanked Kirsten for kicking off the fundraising and gave her a lifetime pass to the JEM. For the older crowd there was Football Monday, when Paul and Michelle projected a Vikings-Packers game. They couldn’t charge admission, but they sold tickets for drawings of prizes donated by local businesses.

Even though they had the equipment, Paul and Michelle still needed to pay for it. Later in November, the Trust for a Better Harmony stepped in to help. Enabled by a generous gift from Ms. Gladys Evenrud, the Trust and a Minnesota agency for community development arranged for a flexible loan package. As a result, the JEM now needed only $28,000, to be paid from community donation. The loan sparked still more offerings to the projection bank account.

 

New decisions

Paul Haugerud, son Peter (in overalls), and local boys tour the JEM booth.

On 13 January of this year, Paul died.

Commander of the local American Legion, he was cremated with military honors. He left behind Michelle, his six children, his parents, four brothers, and two grandchildren. The town grieved. “There’s nothing he wouldn’t do to help someone else,” a friend said.

Michelle remembers weeks going by in a blur. Friends brought over way too much food. “I had to freeze a lot of it.” She decided she simply had to move forward. She had a full-time job and had Peter, Julia, and Sierra at home, but she would keep running the JEM.

In February, a fundraiser was held at Wheelers Bar & Grill. The event had been planned before Paul’s death, but now it gained a new urgency and poignancy. Wheelers is named for its big roller rink, where Paul had helped out often. Across the day Wheelers held a silent auction and some bean-bag and darts tournaments. Those, along with food, drink, and music, raised an astonishing $16,000. That, plus the balance in the digital account, yielded enough to pay off the bank note for the projector. There have been more fundraising events, including a pancake breakfast. Michelle will soon pay the rest of the money owed. Any funds left over will be used for upgrades. Michelle is considering 3D conversion in a year or two.

 

Saturday night at the movies

Things have happened so quickly that Michelle hasn’t had time to thank everyone fully on her website, but she adds in a note to me:

It is so overwhelming to think of how the entire community and beyond has come together to make this all happen. I know that even though I am now the owner/ operator of the JEM, this theatre will be here for generations to come. I have had so many thanking me for staying in business. I know this is part due to the conversion and part due to Paul’s passing. I am very grateful for Paul’s family and my friends for being there helping me through all this.

Last Saturday, The Hunger Games drew a robust crowd, mostly groups of boys, groups of girls, and families, with a few elders sprinkled in. Nearly everybody bought concessions. Many carried in buckets for popcorn. The ticket booth was decorated with Easter rabbits and a Darth Vader helmet.

Upstairs, I saw a little room off the projection booth with a porthole. It was Michelle’s and Paul’s “private screening room,” she explained. They would watch the show from an old car seat there.

On the sidewalk outside, Girl Scouts were selling cookies. In the tiny lobby, dozens of construction-paper stars were pinned up, each bearing the name of someone who donated money. Above the booth was hung a framed lobby card for It’s a Wonderful Life.


Thanks to Michelle Haugerud for all her cooperation and enthusiasm. Her informative JEM website starts here. The page devoted to the digital upgrade traces the fundraising process and records her gratitude to the community. , On the same page, scroll down to see a video of Paul running the last 35mm show. Michelle supplied the photo of Paul and Peter above. Many of my quotations come from news stories that are linked on the JEM site.

Statistics on the number of theatres and screens in the US come from the annual reports of the Motion Picture Association of America and from  The NATO Encyclopedia of Exhibition. Patrick Corcoran of NATO kindly supplied me with further information.

During my time in Harmony, I couldn’t get access to much material about the JEM in the old days. According to  The Film Daily Year Book, the original JEM Theatre (sometimes called the Gem) opened in the mid-1930s. It burned down in 1940. The building next door was renovated as the New JEM, which opened in September of that year. A plain-spoken house of 325 seats, it had fluorescent lighting, satin curtains, three layers of acoustic tile, and a big furnace for the cold months. Its estimated cost was $18,000. For the premiere, a four-page color brochure was printed and sent to 3000 homes in the area. The publication was “made possible thru the whole-hearted cooperation of the businessmen of Harmony who fully realize the value and convenience of this modern, good-looking theatre.” This information comes from “Harmony, Minnesota, Salutes New Jem Theatre, S. E. Minnesota’s Finest Showplace!” The Harmony News, flyer dated September 1940.

Three years later the JEM closed and became a bowling alley. It sat vacant from 1947 to 1961, when Bob and Hazel Johnson reopened it. For a fuller chronology, go to Michelle’s page on JEM history.

Michelle Haugerud and daughter Julia, 24 March 2012.

PS 1 April 2012 Marilyn Bratager writes with this correction about the source of the JEM’s name.

Relatives of mine were the original owners: Joseph Milford Rostvold and his wife, Emma.  The J was for Joseph Sr. and Jr., the E for Emma and their daughter Elizabeth, and the M for the senior Joseph’s middle name, Milford, which was the name he was known by.  There was a third child, Richard, but they didn’t use his initial as they didn’t want the theatre to be called JERM. :-)  

Thanks to Marilyn for the information!

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comments about the state of this website go to Meg Hamel.