Folk on the Rocks was $274K in the red before this year's festival. It says it can recover

The executive director of Yellowknife's Folk on the Rocks says good budgeting, sponsors, and fundraising activities will help the music festival recover from the hefty deficit it's been grappling with the last few years.

According to its most recent financial statement in March, Folk on the Rocks (FOTR) headed into this year's event, which happened earlier this month, with a deficit of $274,087 – an improvement from the previous year when it was $391,505 in the red. 

"We've had a couple of challenging years," said Teresa Horosko, the festival's executive director. "The number can be shocking. But I fully believe that we're going to be able to make it through it." 

This year's opening night cancellation due to a thunderstorm didn't help — the festival described it as a "devastating financial loss." Horosko said Friday typically brings in about a third of the festival's site sales, and it's difficult to make up for that much lost revenue in the other two days.

Financial trouble brewing for years

Folk on the Rocks cancelled its 2020 event because of COVID-19. The festival ended that fiscal year with a nearly $17,000 surplus, but the following year it had a $21,000 deficit. The year after that, that deficit had nearly doubled. 

Horosko said it's been tough for festivals to recover from the pandemic. For example, she said, the Regina Folk Festival has shut down and the Vancouver Island Music Festival took a pause in 2023. Also factoring into the situation are rising costs and shrinking arts grants. 

But it was in 2023 that things appeared to get significantly worse for Folks on The Rocks. The festival changed accounting methods and in just seven months, its deficit ballooned to nearly $238,000 by March 2023 and then to $391,000 in March 2024. 

Asked what happened that year, with the pandemic already in the rear-view mirror, Horosko said there had been a settlement with a previous executive director that carried "financial ramifications" that were still being dealt with. 

Documents from the N.W.T. Supreme Court show David Whitelock, a former executive director of the festival who had been suing FOTR for $145,000 in damages over what he alleged was his wrongful dismissal in 2015, withdrew the case in May 2022. 

Horosko wouldn't comment further on the settlement. Kayla Cooper, the president of the festival's board of directors, would not say how much it was worth, writing in a text message to CBC News that the out-of-court settlement was confidential. 

Whitelock lost a separate legal battle against the festival in 2018 when the N.W.T.'s highest court dismissed his appeal claiming that the festival owed him an unpaid bonus.

Where the festival makes and spends money

Performers are one of the most expensive things the festival spends money on, but since the 2019 festival that cost has been eclipsed every year by the fees paid to contractors and personnel. 

In the March 2025 statement, personnel cost nearly $284,000 while performers cost $192,000. Ticket sales, meanwhile, were the highest they'd been in that same period, at nearly $412,000. 

Grants and donations the festival brings in have fluctuated over the years but in 2025 they were worth more than $480,000. The festival also made nearly $121,000 on food and drinks, and more than $45,000 on merchandise. 

Those same items are also some of the festival's biggest expenditures. In the last fiscal year FOTR spent $74,000 on sound, $71,000 on food and drinks, $56,000 on marketing, $51,000 on "other events" and $50,000 on merchandise. 

The recovery plan

Moving forward, Horosko said the festival has some plans to recover from its current $274,000 deficit and a 2025 festival that had "ups and downs." For one thing, she said, the deficit doesn't have to be paid off right away. She said FOTR has payment plans for some of it that'll go into 2028. 

"That's a little bit reassuring," she said. 

Horosko said the festival will be offering refunds to people who had tickets for the Friday's cancelled Warm the Rocks event, but that it's asking people who have the means to donate those tickets back to the festival. She said FOTR is talking about some other fundraising events that can help it recuperate costs as well. 

"And, you know, letting our audience know that we aren't out of the woods yet and being transparent that we could still use their support," she said. "We've done a lot of great work in a year, but there's a lot of work that needs to be done."