Downsizing isn’t always a bad thing, even for an arts festival. After losing money in 2008, Spoleto Festival USA is bouncing back with strong attendance levels and good word of mouth. The renovated Dock Street Theatre has been a successful lure, but, in general, the program has contained streamlined shows that forgo breathtaking spectacle and focus on good performance.

Out of the two plays offered by Spoleto, only one is a traditional stage production (Present Laughter). The other is a fast-paced one-man show with a quirky structure and a philosophical theme (This Is What Happens Next).

Other genres look just as undernourished. The only true opera on the program is Proserpina, revolving around a solo singer with a chorus to back her up toward the end. This is a festival on rationing.

These productions take just as much time and effort to put together as a traditional concert. The performers and/or musicians have to rehearse, sets usually have to be built, and the marketing machine has to be cranked into action no matter how big or small the product is. Still, an economy of scale is a factor that effects the whole festival. Whether by coincidence or design, there’s definitely a stripped-back feel this year.

But something interesting has happened as a result of these cutbacks. Instead of discussing cool sets or outlandish costumes, people are talking about the performances. Whether or not they appreciate the modern classical music of Wolfgang Rihm, they zero in on Heather Buck’s touching portrayal of Proserpina. For many, composer/conductor Neely Bruce is as much a star of ballad opera Flora as its flowery decor. And the actors of Laughter‘s Gate Theatre have not been upstaged by their costumes this year.

According to the festival’s General Director Nigel Redden, the budgets for 2009 and ’10 were significantly lower than ’06 and ’07. A gala at the Dock Street helped bring in some much-needed extra funds, and projected revenues and contributed support for this year are higher than 2009. “Ticket sales are … above all historical levels, and contributed income from individuals is strong,” he said in a memo to the Spoleto Festival USA Board of Directors — and that was way back in January. He also notes the challenges of the recession, state budget cuts, and dwindling corporate donations.

Spoleto has had leaner years before — 1993, 1994, and 2000 in particular. After an expensive Chinese opera production, low ticket sales, and a state budget cut of about $250,000 in 2008, the organization tightened its belt and waited for the economy to rebound. It’s still waiting. Right now, Redden and his team are cautious about spending their multimillion-dollar budget. Thankfully, they haven’t been as risk-averse with their programing.

An arts organization has two choices when it needs to boost revenue: stick with popular works that are guaranteed to fill seats or concentrate on the high quality of the performers and hope that patrons will take a chance, appreciate what they see and hear, and tell their friends. While there’s plenty of well-known or well-liked material this year — Mozart, Beethoven, the Gate Theatre, the Colla marionettes — real attention has been paid to quality. The Spoleto Festival Orchestra is better this year than in 2009 — and it was damn good then. The musicians have also been more versatile. I’ve seen Flora singers in Music in Time and Intermezzo concerts, increasing the audience’s appreciation of what they do and how hard they work. Conductor John Kennedy has pulled triple duty on Proserpina, Music in Time, and Intermezzo III. And members of the Westminster Choir have also been used in Flora and Proserpina.

It’s not unusual for the musicians to be used for more than one form of music; they’re not called a festival orchestra for nothing. But the sheer range of what they’re taking on indicates that they’re being stretched. They’re handling the pressure very well, and it’s helping Spoletians to become familiar with the leading players of the year.

Redden’s crew have made up for the lack of theater and opera with plenty of dance. The nostalgia of Flora is all well and good, but for the festival to have a future it needs to look forward, too. Gallim’s I Can See Myself in Your Pupil helped with that. It was a fresh, imaginative take on contemporary movement. The Gallim dancers did not conceal their art; they did not hide in the wings when they changed costumes or prepared for a sequence. They let the audience see their process as they unleashed their emotions. This was much more satisfying than the formal Lucinda Childs’ Dance, where a 1979 film was projected in front of present-day dancers making the same moves. The current work was too prim and repetitive, too reverent of its source material. The ’70s dancers were more fluid and seemed to be enjoying themselves a lot more. Worst of all, the live dancers’ feet were obscured by the bottom of the projector screen. People paid good money to see those feet! It was the only show where the nosebleeders had the best seats in the house.

Lucinda Childs was an example of the organizers selecting famous names (Childs the choreographer and that old Spoleto fave, composer Philip Glass) rather than considering the material fully and realizing its lack of connection with the audience. On the night I saw the show, several people walked out, and by the third act, patrons were talking amongst themselves about the dance or checking messages on their cellphones.

Unusual for a performing arts festival, there’s been no classical ballet yet. Les Ballets Trockadero de Monte Carlo certainly had the chops to do justice to Swan Lake and Paquita, but their comical take on the form doesn’t really count as bona fide ballet. Hopefully, the National Ballet of Georgia’s Giselle will redress that balance, if the dancers can survive until then (the male lead has had to be replaced twice due to injury).

Much of the dance has taken place in the Gaillard, and I’ve already griped about the shallow gradient of the auditorium. Practically every time I’ve gone there, I’ve heard attendees complaining that they can’t see properly because a big bonce is in front of them. The acoustics aren’t great either, meaning that if you really want to get the full impact of a performance, you have to sit near the front. Maybe Mayor Joe Riley heard our collective moans, because this week he announced a $142 million revamp of the building. This ambitious two-year project would kick off in 2012, adding offices, expanding banquet space, and improving the auditorium. The city would pay half of the costs, with the rest of the money coming from private donors.

It’s no coincidence that the announcement was made right in the middle of the festival. The Dock Street Theatre has shown how a renovated arts venue can attract audiences and improve Charleston’s profile, although it’s far too early to tell whether all the time and expense involved in such a project will pay off. The many out-of-towners who pay attention to Spoleto will now be aware that we’re improving the Gaillard, encouraging them to come and check it out in a few years’ time.

But the news is a big deal for locals too. There are roads to be fixed, drains to be improved, schools to be earthquake-proofed. Of course, the Gaillard money comes from a different pot, but the city still has other priorities.

For a long time, members of the local arts community have pushed for a multipurpose arts center that will be a resource for the creative cultural community and attract patrons. But the new Gaillard Center sounds more like a cleaned-up version of the old auditorium than a real response to those requests. By making the announcement during Spoleto, locals will have the memory of some entertaining shows fresh in their heads, and they’ll be more amenable to the decision. Never mind the folly of spending so much money on a building so close to the ocean in a city that’s had its fair share of hurricanes.

Another big announcement was made a few days beforehand. This one came from Emmanuel Villaume, the Christel DeHaan music director for opera and orchestra. With two other jobs and guest conductor gigs filling his calendar, he resigned from his nine-year Charleston post. His last concert as director was performed on June 6, ending with poignant encores of Le Nozze di Figaro and other popular works. After the show, he was in good spirits, probably due to the ecstatic send-off that the audience gave him. Globally recognized as a philharmonic orchestra maestro, Villaume has been a big draw for the festival since his first involvement in 1990. As the festival headhunters track down a replacement, the spruced-up Gaillard venue will be a useful (if expensive) bribe.

Piccolo Spoleto had no such earth-shattering announcements to make. It was too busy picking up the Spoleto Festival’s slack, providing avant-garde theater, a feast of visual arts, daily dance performances by different companies, events for disparate religions and ethnicities, and observational comedy. The offshoot festival, run by the city’s Office of Cultural Affairs, seems more relevant than its big sister this year, with less financial or artistic caution. Some of the Piccolo fare is low-budget, and it’s not all successful. But it does one thing very well that Spoleto can’t or won’t do: it builds relationships between artists, venue owners, and regular folk. It links local performers with ones “from off,” brings big shots to little venues, gives lesser-known local people and places a chance to impress visitors from across the country. This is how the Edinburgh Fringe Festival took off, and the way that Piccolo will succeed in the future is not by banking on headline stars but by supporting the little people.

There are two big productions still to come to Spoleto, Giselle and Oyster by the Israel-based Inbal Pinto & Avshalom Pollak Dance Company. To make the festival a real success, they need to be beautifully executed, cutting-edge, visually interesting performances. That’s a lot of pressure to put on a couple of dance shows. Giselle is more of a traditional ballet that we haven’t seen so far this year; Oyster is heavy on spectacle. Between them they hit the demographics the organizers are after: hardcore high-art lovers and people who need some fun with their floorcraft. Beyond that, the festival will end with another example of rationing: fiddle and banjo music rather than a grand classical offering. The Carolina Chocolate Drops will have to work extra hard to give Spoleto a satisfactory send-off. If they achieve that, the audience should appreciate them just as much as a big by-the-numbers orchestra.