Management, Board and Musicians Work Together to Strengthen Orchestra's Financial Position
July 30, 2009 (Baltimore, MD)—In recognition of significant shortfalls in revenues, the musicians of the Baltimore Symphony Orchestra and the BSO Board of Directors have approved concessions to the players’ current three-year contract, originally settled in August 2008. There will be two weeks of voluntary furlough in August 2009 and three additional weeks of furlough and a pay cut in the 2009-2010 season. The combination of a pay cut and furloughs will result in a 12.5% reduction in annual salary. Several positions in the orchestra will remain vacant and pension contributions will be reduced. The total savings amount to $1.9 million.
Against a backdrop of two balanced budgets in prior years, the 2008-2009 season has been deeply affected by the prolonged economic downturn. While subscription ticket sales, which had come in before September 2008, exceeded budget by 4.3%, single ticket revenues declined 21%. Corporate, foundation and government funding all experienced decreases, and even though the total number of individual donors in the 2008-2009 season is projected to rise by an impressive 26%, individual gift amounts are on average 17% down. Significantly, the BSO’s endowment has decreased 21% in value since August 31, 2008. As a result, the fund is below its historic dollar value (the “waterline”), and the endowment will not be making its projected 5% gift of $2.7 million.
Earlier in the year, the BSO had already proactively made reductions to administrative and artistic expenses including layoffs, furloughs, position eliminations and repertoire changes. Additional pay cuts or furloughs for staff are anticipated for the coming season. These earlier adjustments and all the changes announced today enable the BSO to go forward in the 2009-2010 season with a balanced budget of $24.9 million, which is 13% smaller than the 2008-2009 budget.
The new contract concessions include the $1 million in savings and donations voluntarily offered in April by the BSO musicians as a challenge designed to raise an additional $2 million in new and increased gifts for the Orchestra by the end of the 2009-2010 season. This unprecedented fundraising campaign, “Music Matters: Play Your Part," has raised commitments to date of over $750,000 and has seen an expansion of the BSO’s presence in the community with performances by BSO musicians in local shopping malls, outdoor parks, Baltimore’s Pier 5 and the National Institutes of Health in Bethesda, MD. Music Director, Marin Alsop, made a lead gift of $50,000 towards the campaign.
BSO Board Chairman Michael Bronfein commented, "Our musicians, staff and Marin Alsop have demonstrated their extraordinary leadership and commitment to the long-term health and fiscal stability of the organization. Over the past three years, the BSO has done nothing but thrive and right its course; unfortunately, the economy has not. I am proud to lead an organization that can and will always work together—musicians, board and the staff—to figure out a solution that will maintain our solvency and artistic quality in good and bad economic times. The sacrifices made by the BSO this year to stay on solid ground are to be applauded and supported, and enable us to fulfill our mission to provide access to symphonic music to all Maryland citizens and exposure of the musical arts to our children regardless of means or status. Now more than ever, we ask the community to help us achieve these goals by contributing to our “Music Matters” campaign." Laurie Sokoloff, BSO piccoloist and Chair of the Players Committee, added, “I have never been more proud to be a member of the Baltimore Symphony. We in the orchestra are dedicated to our art, and are making financial sacrifices in order to continue to provide great symphonic music to the State of Maryland. The Music Matters campaign has brought us closer to our audiences than ever before, and their support and enthusiasm has heartened and inspired us beyond measure. We have proven our ability to be responsive to the needs of the organization and to preserve our identity as one of the world’s great orchestras.”
“The economic downturn has caused us to make difficult decisions in order to secure the future of the organization,” says BSO President and CEO Paul Meecham. “Thankfully, the BSO approached this recession from a position of strength, reporting a balanced budget for two consecutive years. The musicians’ and staff’s willingness to make further necessary sacrifices will strengthen our cash position moving forward and reinforce the Association’s intention to deliver a balanced budget in FY10. Because all constituencies of the organization are working together, we are proud to still be able to deliver a full season of the quality programming and notable guest artists that our patrons expect of their Baltimore Symphony.”
Despite the budget cuts, the BSO projects continued success on several fronts. On August 25, 2009, the Naxos label will release the much-anticipated recording of Leonard Bernstein’s Mass, of which the Financial Times reported, “…[Alsop] inspires a reading of joyous finesse.” The cover story in the 2009 July/August issue of Symphony Magazine (the trade publication of the League of American Orchestras) touted the Baltimore Symphony’s dramatic turn-around in recent years from multi-year operating deficits and empty concert halls to financial stability and adventurous programming performed for full houses.
“The BSO’s turnaround is not only in the fiscal front,” reports Symphony Magazine, “but includes a fresh emphasis on communication and transparency, as well as on connecting with new audiences in the orchestra’s hometown.” Necessary and proactive cost reductions now will ensure that the Baltimore Symphony Orchestra’s positive momentum will continue into the future.