ESCONDIDO - Low ticket sales at Escondido's arts center caused a budget deficit of more than $400,000 in the last fiscal year, arts center officials said Tuesday, but they say they have a plan to turn things around.

Vicky Basehore, president of the California Center for the Arts, Escondido, said ticket sales were higher than the previous year, but weren't high enough to make the center break even.

Basehore announced earlier this month that the center was expecting a budget deficit of about $400,000 for the 2006-07 fiscal year that ended June 30. No other details were available until a meeting of the center's board of trustees on Tuesday, when the center announced that the deficit was $419,554.

According to Basehore's financial report, the center's $6.6 million budget wound up with a deficit even though costs were less than anticipated by about $150,000.

The center expected earnings from ticket sales and fees, theater rentals, and other services to bring in $5.6 million. But those sales fell short by $645,476, the report says.

Low ticket sales accounted for almost all of the shortfall, according to the report. The center had planned for almost $2.3 million in ticket sales, but instead earned $1.6 million, the report says.

The arts center has struggled with ticket sales since it opened in 1994, and the 2006-07 fiscal year marks the center's 11th operating deficit. The center's 2006-07 season included performances by country singer LeAnn Rimes, the San Diego Symphony, comedian Bob Newhart, the Moscow Festival Ballet and jazzman Wynton Marsalis.

Basehore said that despite the shortfall, ticket sales were up $336,000, or 26 percent, over the 2005-06 season.

"We are making progress in that area," Basehore said, adding that there is "still much work ahead of us."

To improve ticket sales, arts center officials have formed a new marketing team.

Michael Wagman, the new marketing director, said Tuesday that an improved, more user-friendly Web site was among his strategies.

"The minimum is to break even," Wagman said. "And obviously, the goal is to make a profit."

Basehore also reported that theater rentals, educational programs and the center's museum all earned more money than expected, totaling $137,000 in extra funds. Money from contributions totaled $1.06 million, which was $51,840 more than had been anticipated.

But that money wasn't enough to make up for the loss in ticket sales and in some other revenue areas.

The center's continued financial struggles have created debate among city leaders over whether the arts center should be expected - or ever was intended - to stand on its own financially. The city built the $81 million arts center, along with City Hall next door, through a bond measure approved by voters. The city contributes a significant amount of the center's revenue each year.

In 2006-07, the city gave $2.4 million in cash and other donations, including computers. Under a new agreement between the city and the arts center that went into effect July 1, Escondido is obligated to cover the center's budget deficits.

Arts center supporters say expecting the nonprofit center to pay for itself is unrealistic. The arts center provides an important cultural and entertainment resource that attracts out-of-town visitors, is used by schools and other organizations, and promotes the arts, supporters say.

The arts center has a 1,500-seat concert hall, a 400-seat theater, a museum and a conference center. According to arts center officials, the center's theaters were rented for 86 special events and 165 performances in 2006-07, and it also was used for five educational programs, including 21 performances in the center's Student Performance Series.

City Council members have expressed mixed views on the arts center's financial situation, although most have expressed concern about its repeated deficits.

Mayor Lori Holt Pfeiler has said the city always will need to help fund the arts center, agreeing with others who say it won't ever be able to pay for itself. Councilman Ed Gallo has said he thinks that the center eventually will be able to cover its own costs while operating as a nonprofit, and Councilwoman Marie Waldron recently suggested that an outside company should take over the center to help it turn a profit.

Basehore said the arts center's $6.5 million budget for the 2007-08 fiscal year is expected to be presented to the City Council on Sept. 19.

- Contact staff writer Paul Eakins at (760) 740-5420 or peakins@nctimes.com.