It marks a sea change: The hardnosed musicians of the Chicago Symphony Orchestra — the orchestra that shut down the CSO for the 100th anniversary performances that would also have been Daniel Barenboim’s first concerts as music director, one of the best-paid ensembles in the country, and as tough and no-surrender a band (in the spirit of legendary Chicago-based American Federation of Musicians capo James Caesar Petrillo) as has ever been — have agreed to givebacks, effective July 1 through September 18, 2011.
The cause, of course, is the stock market’s dismal performance over the last few months, and its unhappy effect on both endowments and present giving.
In a press release issued on May 16, the Chicago Symphony Orchestra Association announced that the players have agreed to cut their pay by 2.5%, put off filling most vacancies in their ranks, and donate their time for one rehearsal and one performance for a concert to benefit the CSO in each of the two coming seasons.
Other cuts within the organization will also help in controlling expenses, intended to add up to a total of $4 million over three years, including but not limited to trimming capital spending down by 25% this year; major cuts to fees paid to guest soloists and conductors; a smaller administration; less travel; “adjustments to contracts with vendors;” fewer extra players; and changes in programming.
That means, among other things, that Osvaldo Golijov’s “La Pasión según San Marcos,” originally scheduled for March 2010, won’t be heard anytime soon. Other changes have yet to be announced. Words to watch warily: “re-evaluation of institutional priorities.”
Here’s the press release, viewable in context at http://www.cso.org/main.taf?p=17,9,3,67 [1]
FOR IMMEDIATE RELEASE:
May 16, 2009CHICAGO SYMPHONY ORCHESTRA ASSOCIATION TAKES STEPS TO ENSURE FINANCIAL STABILITY
In light of global economic challenges, the Chicago Symphony Orchestra Association has taken steps to address the recessionary impact on the Association. With leadership provided by the Chicago Symphony Orchestra Association Board of Trustees, the administrative staff and musicians, as partners, have committed to a plan that will save the Association an estimated $4 million over the course of the 2008-2009 through 2010-2011 seasons. Through prudent cost-saving measures, creative revenue-generating activities and re-evaluation of institutional priorities, the CSO family has come together to ensure the long-term fiscal health of the Association while remaining committed to presenting programs of the highest artistic quality.
The Chicago Symphony Orchestra Association began the 2008-2009 season in a strong financial position, with a subscription campaign that outpaced the previous year’s sales by 2% and a Main Series subscription renewal rate that exceeded 87% for the second consecutive year. Subscriber single ticket add-on sales also exceeded the previous season’s by 76%. At the close of last fiscal year (June 30, 2008), the CSO reported a modest surplus and a 5.2% increase in its Annual Fund giving.
After the mid-September stock market decline, ticket sales and contributions slowed and are not expected to meet budget goals for FY09. Current ticket sales total $19.8 million and are less than 1% behind compared to this time last year. Year-to-date Annual Fund contributions total $15.9 million, essentially flat with last year but tracking behind the $19.6 million 2009 Annual Fund goal. Softness in ticket sales and projected contributed revenues represent a potential budget shortfall at the end of this fiscal year.
The stock market’s decline will reduce future endowment draws and increase pension fund contributions. Financial projections for FY09 and for FY10 have necessitated the development of cost-saving measures and creative revenue-generating projects aimed at closing the estimated gap between total operating expenses and revenues.
Savings of nearly $1 million have been achieved in FY09 through prudent expense management. Through a restructuring of operations and a reprioritization of the 2009-2010 season as well as an agreement reached with the CSO musicians, the FY10 budget is nearly $2 million smaller than originally planned. Those savings were reached through cost reductions across all operating departments, including limits on staff travel, restructuring of the Symphony Store, adjustments to contracts with vendors, the deferment of several large-scale programming initiatives that were in the planning stages and a reduction in performance fees for guest artists and conductors. Capital spending has been reduced by nearly 25% for the current season and 50% for next season.
In October 2008, the Association instituted a salary and hiring freeze across all administrative levels, which will remain in effect through the 2009-2010 season. Through attrition, there has been a reduction in the organization’s administrative workforce of 10 positions or approximately 10%. The annualized total cost savings gained through the hiring and wage freezes is nearly $700,000.
In partnership with the staff, the musicians of the Orchestra have generously come forward to participate in measures that total $1.8 million in savings and revenue-generating opportunities for FY10 and FY11. Beginning July 1, 2009, all musicians have agreed to a reduction in negotiated salary rates of 2.5% for a term of two years (through September 18, 2011). The filling of most current vacancies will be deferred until September 2011; a reduction in hiring of temporary musicians will also be implemented. The members of the Orchestra have also agreed to provide two additional services (a rehearsal and a performance) during each of the upcoming two seasons (2009-2010 and 2010-2011) in order to perform concerts that will benefit the Association.
Programming changes have also been made to previously announced CSO subscription concerts for 2009-2010. Among these changes is the postponement of Osvaldo Golijov’s “La Pasión según San Marcos,” which was previously scheduled for March 2010, to a future season. A replacement program for the “Pasión” as well as other programming changes for the 2009-2010 season will be announced at a later date.
“The Chicago Symphony Orchestra Association is deeply committed to ensuring its fiscal sustainability over the long term,” said Deborah F. Rutter, president of the Chicago Symphony Orchestra Association. “While the CSO has been able to weather much of the economic tumult through a secure position, we continue to make prudent decisions to reduce costs while maintaining artistic quality at its highest level. We are grateful for the sacrifices that our staff and musicians have made for the greater good of the CSO. Their generosity is a true testament to their dedication to this great organization and to the city of Chicago.”
“With a storied 118-year legacy and a very strong future, the Chicago Symphony Orchestra is one of the city’s most important cultural assets,” stated William A. Osborn, chairman of the Chicago Symphony Orchestra Board of Trustees. “However, the CSO faces many of the same challenges that other nonprofit institutions are experiencing across the country. While we are expecting a budget shortfall at the end of this fiscal year, the administration and musicians have admirably united to counteract these circumstances, and, along with the Chicago Symphony Orchestra Board of Trustees, are dedicated to minimizing the adverse effects of the recession on the financial strength of the CSO.”
“The musicians are committed to the long-term strength and stability of the Orchestra,” said Steve Lester, chairman of the CSO Members Committee. “We all realize that these unusual challenges require unusual actions, but we are confident that by working together in this way we will keep the Orchestra as the preeminent ensemble of this country.”
“We are proud that our members rose to the occasion and agreed to contract revisions that will save $1.8 million at this critical moment in the Orchestra’s history,” Gary Matts, president of the Chicago Federation of Musicians. “The CSO Musicians voluntarily took these steps to help ensure that the CSO Association will maintain a viable financial position during these troubled economic times and for the longer term.”