The Burning Man Project’s spending stabilized in 2005. Total expenditures in the previous year totaled $8,557,308. This same entry in 2005 sums up to $8,397,178. It should noted, however, that our income in 2004 barely matched our year-end costs; whereas, at the end of 2005, we carried $234,000 in cash and pre-paid expenses into 2006. This is an improvement in our money management. When viewed as a whole, however, our total expenditures in 2004 and 2005 are remarkably similar. The real story in 2005 is about how we allotted this spending. The greatest change involves real estate purchases and land development. In 2004, for example, $247,103 was spent on real estate purchases in Nevada, and $617,142 was spent on land and building improvements for our Nevada production facilities. By way of contrast, only $151,649 was spent on such improvements in 2005, and no money at all was spent on real estate acquisition. Instead, we channeled money into other areas. Most notably, in terms of the immediate experience of most participants, we significantly raised the amount of money allotted for art. We increased honoraria for artists to $437,937, as against $255,028 in the previous year. Likewise, a more ambitiously interactive Man installation cost $136,304, up from $109,414 in 2004. Although, our land improvement costs diminished in 2005, our office rental costs increased. In mid-2004 we expanded our office facilities in San Francisco, choosing to rent the first floor of our two-story building. We therefore paid our landlord a full year of increased rent in 2005: $259,223, approximately $40,000 more than in 2004. We also rewarded employees with higher pay in 2005, Our payroll rose to $1,759,934, compared to $1,493,476 in 2004. This means we hired a few more people to perform administrative tasks and increased the pay of many other full and part-time employees. This is part of an ongoing campaign to raise employee salaries and related benefits to a level that is more in keeping with compensation in the greater job market. This policy is about parity and fairness, an investment in human beings, and represents a long awaited reward for hard work, loyalty, and faith in Burning Man’s future. Moreover, this increase in staff compensation is ultimately related to greater business efficiency. For example, in 2005, better organization and management of our DPW workforce made it possible to accomplish more while employing fewer people. This resulted in overall savings, but it doesn’t mean that we were paying individual workers less; it means many folks were working smarter while receiving a reward for exercising more responsibility . It should be noted that some of our costs increased in 2005 due to inflation, especially in the categories of fuel and transportation. Our fuel bill rose from $92,270 in 2004 to $113,671, rental charges for machinery increased by approximately $100,000, and shipping costs increased from $3,451 to $14,780. However, we more than made up for this through a better organized management of resources. In comparing our material costs in 2004 to those in 2005, it is apparent that several categories of expenditure have remained flat or decreased. Lastly, one category, watering and dust abatement, significantly decreased in 2005, dropping from $342,000, in 2004, to $218,669, a savings of more than $124,000. This is because the purchase of a dust retardant in 2004 allowed us to stockpile this product for use in succeeding years. This trail of money tells a moral tale. Having invested nearly a million dollars in our infrastructure in 2004, we changed course in 2005 and focused our expenditures on better management of people and process. In addition to the explicit costs that are listed in the accompanying chart of expenditures, we delegated authority and responsibility more broadly than ever before. We improved communication on many levels; we created better reporting paths, devised better job descriptions, and improved the means by which we judge performance. In other words, we learned to better cooperate and respect one another as we pursue the complex goals of the Burning Man Project. Although the event cost no more than in 2004, it was — by popular acclaim, as well as every other measure — the best Burning Man ever.