Far more frequently than ever before, I find myself turning on the television in the mid-afternoon to monitor the superimposed number that represents the current volatility of the stock market. That number, all too often a three-digit negative figure, is affecting all of our lives as our pensions, 403(b) accounts, and investments incur losses. Just as we all feel the effects of this economic crisis in our personal lives, many non-profit organizations are facing the ramifications of losses in their endowments. A few of these organizations prepared well, and the problem won’t affect everyone in the same way.
I do not doubt that we will emerge from this crisis with a recovery that offers great opportunities. It is clear that the arts and our orchestras offer a sound economic investment for our communities and that we can and will play a significant role in that recovery which surely lies ahead.
But, before then, some of us will inevitably face tough decisions as our managements approach us with what they might label as “dire” news. We must be prepared to seek the answers from our managements that will allow us to verify the situation our orchestra might be facing. The news may or may not be as “dire” as it is being presented. And in all cases we should be prepared to offer our managements and boards the information they need to illustrate to our cities how vital we will be in the economic rebound that awaits.
When you are elected to serve on an orchestra committee, you take on many responsibilities for the concerns of your colleagues, as well as some liabilities in terms of the duty of fair representation. What should our orchestra committees be doing to prepare for these difficult times, and how should they be communicating with their colleagues?
1. Seek the information you need from Management.
Your management should be eager to keep you fully informed of their financial situation at all times, but especially during tough economic times. Key information you need can be found in the management generated financial reports, the audited statements, and in the Forms 990. You should have this information over a period of several years in order to identify trends.
2. Keep your colleagues informed.
In times of financial difficulty, it is easy for a sense of panic to set in among members of the orchestra. Nothing panics an orchestra more than a lack of information, which leads to inaccurate speculation that is, by its very nature, ill informed. Frequent meetings of the players’ association should be held, allowing for members to ask all of their questions and express their concerns. Remember that it is natural for emotions to run high during difficult times, and some opinions will be expressed strongly. It is important to honor that, and for us all to respect the opinions of our colleagues, even if we feel that respect is not necessarily returned.
3. Inform your local president and your orchestra’s attorney.
Our committees should be as inclusive as possible during a time of financial concern. Decisions might have to be made quickly, and no one should be caught off guard. Your local president has a key interest in the events and must be fully apprised. Your orchestra’s attorney can offer guidance and advance interpretation of any relevant contractual clauses that might come in to play. In times of severe crisis, we have seen managements miss payrolls, or even threaten bankruptcy or force majeure. The management might want to open the contract mid-term. All of these worst-case scenarios have implications for the collective bargaining agreement, and the attorney should be apprised in advance of the potential for difficulties.
Often the management will bring a crisis to the orchestra, with the admonition that we have to act immediately for our survival. At times like this it is wise to remember the words of the late Lew Waldeck, who would advise “If you have to know right now, the answer is no.”
While you might not know for certain what will happen, you can anticipate and prepare for a series of likely events. The better prepared that you, your colleagues, your attorney, and your local officers are, the more prudently you can respond.
4. Avail yourself of all resources.
Meet with all of the leaders within your orchestra: past, present and future. Solicit ideas openly. I have found that people can accept if their ideas aren’t enacted, but they can never support actions if they feel they weren’t allowed a chance to express their thoughts.
A great service available through the AFM is access to a noted cpa with a wealth of experience in analyzing the financial situation of symphony orchestras. Mr. Ron Bauers can be hired through the Symphonic Services Division to offer guidance to you in analyzing the financial statements. This service is provided at no cost to the musicians, as the AFM and your local will each pay half of Mr. Bauers’ relatively nominal fee.
If our managements are comfortable with their own numbers, then they should welcome the opportunity to have their findings confirmed by such an eminent person as Mr. Bauers. Of course, should they resist then that might be telling as well.
5. Consult with ICSOM.
As soon as possible, inform your ICSOM member-at-large, or call me directly. It is more important than ever for our orchestras to remain in contact so that we may share ideas and analyze trends. In order for ICSOM to prepare to be of assistance, we need to know quickly where our members might be facing problems within their organization.
Despite the current dire forecasts, I remain convinced that we all will successfully weather this economic downturn, and we will emerge with the prospect of an even greater future. We need to be ready to help our managements, boards, political leaders, and audiences understand just how important investment in their orchestras will be for the future economic health of their communities.
To face this difficult time, we have to prepare well and we must utilize all of our resources. We need to be inclusive, and we need to support each other in the most collegial way. At all times we must work to spread the message of hope that ICSOM has articulated and that our orchestras offer.
In times of difficulties, the citizens of the world turn to musicians and other artists for comfort and inspiration. The community service we provide is more important now than ever, and we must remain ever vigilant in promoting our positive message. Let the words of W. H. Auden take on new significance for us:
The lights must never go out,
The music must always play.
Did You Know?
The nonprofit arts and culture industry in America generates over $166 billion every year in economic activity and provides 5.7 million full-time equivalent jobs. (Source: Arts and Economic Prosperity III, Americans for the Arts, 2007.)
There is a connection between the arts and civic duty. Half the people who regularly visit art museums, plays, or concerts also do volunteer work— compared with less than 20% of non-attendees. (Source: The Arts and Civic Engagement: Involved in Arts, Involved in Life, National Endowment for the Arts, November 2006.)
The percentage of adults attending a classical music performance remained at between 12% and 13% of the adult population between 1982 and 2002. (Source: 2002 Survey of Public Participation in the Arts: Research Division Report #45, National Endowment for the Arts, March 2004.)
In 2006, download sales for classical music grew by 22%. (Source: Newsweek, September 17, 2007.)
Every dollar that the government invests in the arts returns seven dollars to the community. (Source: Arts and Economic Prosperity III, Americans for the Arts, 2007.)
65% percent of American adult travelers schedule a cultural activity while traveling, equaling 92 million cultural tourists. Cultural tourists spend approximately 40% more in their destinations compared to all U.S. travelers. (Source: Partners in Tourism and Travel Industry Association of America, 2002.)
The arts generate $7.9 billion in local tax revenue, $9.1 billion in state tax revenue, and $12.6 billion in federal tax revenue. (Source: Arts and Economic Prosperity III, Americans for the Arts, 2007.)
Classical music accounts for 12% of sales on iTunes. (Source: New York Times, May 28, 2006.)
Ticket sale income from orchestra performances grew almost 18%, to $608 million, between the 2004-2005 and 2005-2006 seasons. (Source: Wall Street Journal, October 3, 2008.)
Opera attendance is up 40% since 1990. (Source: Doug McClennan, Diacritical, www.artsjournal. com/diacritical, November 21, 2007.)