Symphonicide

I’ve been reluctant to write about Columbus, in part because others are doing good work on what’s happening there and in part because it reminds me so much of what happened in Milwaukee in 1993-94, except that Columbus is that story on steroids.

Since I came into the business in 1974 I’ve seen a number of orchestras go dark (including two that I had played in, the Oklahoma City Symphony and the San Jose Symphony, although not while I was there). Most of those situations involved board ineptitude, and some involved bad (in the sense of immoral or unethical) actions on the part of the board or board leadership. But I can’t recall a clearer case of an orchestral board simply murdering an orchestra as is happening in Columbus.

No one would pretend that the Columbus Symphony is in good financial condition at the moment. The musicians, and the music director, blame this on the board’s inability to raise enough money. The board disputes this, of course, and Henry Fogel, president of the League of American Orchestras, was quoted in an article in the Columbus Dispatch on April 9, 2008 agreeing with the board:

The $25,000 goal is a respectable one for a symphony of Columbus’ size…Fogel also commended the symphony for receiving donations from all trustees last season and coming close again so far this season.

“To me, those are impressive numbers about a board’s participation,” he said. “No board can do better than 100 percent. Many don’t reach it.”

Although hardest to quantify, community advocacy can be the most important long-range job of a symphony board, Fogel said.

I tend to agree with Fogel on the issue of the board’s fundraising. I wrote back in January that:

The most useful single index of internal financial balance I’ve found is the relationship between contributed income (whether current contributions or in the form on interest on past contributions – ie, endowment income) and musicians’ compensation. It’s informative about a fundamental question: is the community willing to pay the cost of having an orchestra? I’ve long believed that the total costs of orchestras ought to be divided into the costs of having an orchestra and the costs of using that orchestra to provide services to the community. The latter should be paid for from earned revenue.

The community does pretty well by this metric. In 2005-06, the total contributed income (including investment income) was $5,975,000, while orchestra compensation and benefits came to $4,980,000. Clearly the community is willing to donate sufficient money to pay the musicians what they’re making now.

But the management and staff aren’t doing a very good job of controlling the costs of actually using the orchestra. If the musicians had worked for free, the institution would still have needed to raise $1,281,000 in order to break even.

That’s worth reiterating. If the Columbus Symphony were an amateur orchestra, with all the musicians donating their services, it would still need to raise over $1 million in order to be “sustainable.” How can the problem be that the musicians are making too much money? Isn’t it way more likely that the management and board are doing very badly in making operational costs match revenue from operations?

So why is the CSO struggling? Here’s both cause and illustration of root cause in a nutshell, courtesy of the Board’s own “plan,” the so-called Path to Financial Stability and Future Growth:

…the CSO found itself embroiled in controversy over the departure of it’s (sic) long-time Music Director, a development that divided many of its supporters and generated significant negative publicity, further stressing the CSO’s ability to raise contributed revenue and attract concertgoers. Ultimately this led to the departure of the CSO’s Executive Director. From 2003 to June 2006, the CSO operated without either a full-time Executive Director or Music Director.

That’s worth repeating. The Columbus Symphony functioned without either a full-time CEO or Music Director for three years. And whose fault was that?

What the Columbus Symphony faces (and has for a while) is not a financial crisis; it’s a governance crisis. The Columbus Symphony has a board that did not perform the first and foremost responsibility of any non-profit board, which is to hire competent help. And they didn’t do it the easy and conventional way, which was to hire an inadequate CEO or Music Director. They decided to be original and leave the positions unfilled.

For three years.

But, contrary to conventional wisdom, the Columbus Symphony survived even that. So further steps were necessary, and were taken early this year, according to Drew McManus:

The executive board’s decision to forego subscription renewals in February, 2008 and new subscriptions shortly thereafter was made as early as January, 2008 even though the organization’s executive director described the plan as “injurious” to the 2008/09 season. This single decision delivered two critical blasts into their current financial strategy, one by way of earned income and the other by way of negotiations…

According to the CSO’s proposed financial plan, the organization will need to implement a $9.5 million budget beginning in the 2008/09 season. The executive board arrived at that number after concluding that was the revenue figure the organization could sustain without the participating in the sort of emergency fundraising activity practiced in recent years. However, according to their proposed financial plan, the CSO generated $3.040 million in concert and performance revenue, including subscription sales (renewals and new sales, pg. 25). If the executive board implements the proposed financial plan via a new collective bargaining agreement they expect to generate $3.154 million in concert and performance revenue for the 2008/09 season, an $114,000 increase from the 2005/06 season (pg 27).

This might sound reasonable until you consider that the executive board’s decision to forego 2008/09 subscription sales makes their planned concert and performance revenue goals entirely unrealistic. Even if subscription sales commenced as early as July, the added costs associated with last minute marketing and additional advertisement buys would likely dwarf any eleventh-hour sales. The most likely result is that the CSO would experience a considerable financial shortfall from expected earned income revenue thereby requiring the board to engage in emergency fundraising activity in order to support their $9.5 million budget: precisely the sort of activity they claim is no longer sustainable…

Given the fact that the executive board made the decision to suspend subscription sales no less than two months before negotiations commenced, it is clear they had no intention of bargaining in good faith once bargaining sessions commenced on March 18, 2008. Even if the musicians accepted the CSO’s initial offer of a $3 million budget reduction after the first bargaining session, economic forces were in motion for a full six weeks ensuring that the executive board would have to engage in more emergency fundraising. In short, the board’s public position is nothing more than a fatal string of internal contradictions.

But there’s more! A city and county fund drive, which would have produced $1.15 million, could have gone a long way to fix the short-term problems:

The possibility that the symphony could soon die has prompted campaign organizers to redouble their efforts to match the combined $1.3 million recently approved for the first year of the drive by the city and Franklin County. Organizers have set April 1 as their informal deadline to secure matching money from private donors…The symphony would receive the most: $1.15 million, enough to keep the organization afloat and eliminate most of the $1.4 million deficit projected for 2007-08…

If at least some private pledges are confirmed by April 1, he said, some of the public matching funds could be freed up for immediate distribution…The symphony, Southworth added, is first in line.

But of course there was a Catch:

Even if the campaign succeeds, however, symphony managers will have to work for the money. “There’s a real fear among many corporations of putting money into the symphony again without seeing progress on the restructuring plan,” Southworth said. “Our biggest issue right now is the potential restrictions on certain gifts.”

I wonder how many of those private donors were “encouraged” to put restrictions on their gifts that amounted to mandates that the board’s downsizing plan be adopted.

But the musicians still didn’t fold. So on to Plan C:

According to a Columbus Symphony Orchestra (CSO) press statement dated 5/8/08, the board of directors has cancelled both of the organization’s summer concert series, which have been a part of Columbus summers for more than 25 years. Furthermore, the statement asserts that “due to uncertainties surrounding the 2008-2009 season” the organization is deliberately not selling subscription or single tickets until after they reach an agreement with musicians on a new collective bargaining agreement.

The cancellation of the summer season amounts to a lock-out, which is very likely in violation of whatever no-strike no-lockout clause they have in their CBA. But the failure to sell tickets until the musicians surrender will likely be the fatal wound, as the musicians show no sign of agreeing to work for less than a living wage or to lay off many of their colleagues.

Fortunately the local rag (unlike “the union”) is completely under control:

The union disingenuously accuses the board of being derelict in its duty to seek out more donations, but the board is realistic in its estimates of what the symphony can expect from its benefactors. If anything, the refusal of musicians to recognize financial reality discourages donations because it undermines the confidence of current and prospective donors that the symphony is a sound investment.

The musicians should stop focusing on blame and start dealing with the facts. Business as it has been conducted in the past no longer is an option.

Though many lovers of symphonic music see cultural doom if the symphony folds, the loss would not necessarily mean the end of orchestral music in Columbus.

There is a passionate local audience for the art form, and the symphony board and civic leaders will look for other ways to satisfy the demand. The music need not die.

Whether this becomes necessary is up to the musicians. If they continue to dig in their heels, they will have no one but themselves to blame when the symphony is no more.

“No one but themselves to blame?” It wasn’t the musicians who left the two key leadership positions unfilled for three years. It’s not the musicians who can’t manage to sell more than 1,861 tickets to see Yo-Yo Ma (in a hall that seats close to 2,800; by comparison, our benefit with Yo-Yo was sold out within days of its announcement last year, and our hall seats 2,300). It wasn’t the musicians who put together a strategic plan that any observer of our industry with more than a rutabaga for brains would have predicted with 100% certainty would fail.

It’s not the kind of murder for which anyone will be indicted. But murder it is. Shame on the board, and shame on the Columbus Dispatch.

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