A threat of closure hanging over Birmingham Opera Company has been lifted after the organisation settled its differences with the Arts Council, which has restored a £330,000 funding package.
Three months after deciding to suspend financial aid, Arts Council officials said they were now satisfied with the company's revised business plan and its determination to obtain further grants from other sources.
The decision means that the company's immediate future is safe, with the Arts Council indicating minimum three-year financial support.
A search is under way now for a venue where the company can stage Mozart's Idomeneo in August.
"We will be rehearsing during July and early August," said general manager Jean Nicholson. "There will be seven performances, opening in mid-August. It's the usual thing - I'm looking around now for a venue."
The company, which specialises in mounting productions combining professional and community casts in unlikely places which have included a tent in Aston Park and the former Municipal Bank on Broad Street, enjoyed its biggest success last October when nearly 10,000 people saw its La Traviata, a coproduction with the Arena di Verona, at the National Indoor Arena.
But in January it was threatened with closure when the Arts Council withdrew its funding as part of controversial national review.
Plans for Idomeneo, for which leading roles had been cast but contracts had not been signed, were immediately put on hold.
However, meetings between the company, the Arts Council and Birmingham City Council have now led to funding being restored, with the company undertaking to address concerns about its business model.
The company will appoint an assistant director to develop its outreach work. This means a 50 per cent increase in its full-time staff.
Peter Phillips, chairman of Birmingham Opera Company, said: "We are delighted with this decision from the Arts Council, as it will enable the company to continue its ground-breaking work and the benefits that this brings to communities in Birmingham."
Arts Council West Midlands said in a statement: "Following our decision to suspend revenue funding we have met with the chairman and artistic director of Birmingham Opera Company and representatives of Birmingham City Council. These productive discussions have resulted in proposals from the company which will strengthen its presence in Birmingham and in so doing will address our shared concerns about the impact and reach of their work.
"The company will revise its business plan to reflect an increased organisational capacity which will enable them to develop new funding partner-ships and increase support from the business sector, trusts and foundations, thereby building on the success of the LaTraviata project.
"We are delighted with the positive approach taken by the company and, as a result, we have in turn indicated that we will continue to provide funds to secure their planned programme of activity next year and, in anticipation of progress, for the following two years."
The Arts Council has also announced a £28 million three-year package to support dance activity in Birmingham. Six city-based organisations delivering dance activity have received confirmation of funding for 2008-2011. Birmingham Royal Ballet, ACE Dance and Music and South Asian arts development agency Sampad, have been awarded inflationary increases to their regular funding.
Organisations also receiving financial backing include touring company Bare Bones and DanceXchange.
David Massingham, artistic director of Bare Bones and DanceXchange, said: "I am looking forward to our new international production coming to fruition, ready for touring from the beginning of 2009.
"As a company that takes dance to places that others cannot reach as well as playing major thea-tres. Bare Bones will continue to make a huge contribution to the overall work of DanceXchange."
Chitraleka Dance Company, which delivers training, education and outreach work in South Asian Bharatnathyam dance, has been awarded a 25 per cent increase in its funding over the next three years.