Many nonprofit organizations have been working through lean times since the crunch of 2008. Some orchestras have had to program carefully to limit costs for soloists, music licensing, and supplemental personnel. They’ve cancelled tours and recording projects, taken pay cuts, laid off staff. They’ve reduced their number of concerts.
The Philadelphia Orchestra has gone farther. On Saturday they played Mahler’s Fourth just hours after their board had voted to send the orchestra to bankruptcy court. According to board chair Richard Worley, "We’re running low on cash, we’re running a deficit, and we have to put ourselves in a position to attract investment funds to help us."
The decision wasn’t unanimous. Several board members abstained, and all five musicians on the board voted against the resolution. Some of the musicians believe that the move is partly intended to force renegotiation of their contract. Management reportedly has been considering bankruptcy for more than a year, after deciding it could no longer afford to contribute to the musicians’ pension fund.
As board members entered the offices of their law firm Saturday, musicians were waiting for them. They handed the board members leaflets encouraging a "no" vote, as a string quartet played Schubert and Mozart.
The orchestra expects 2011 income of $33m against $46m in operating costs. The orchestra has a $140m endowment, but use of those funds is restricted.
Some observers blame simple mismanagement, but surely the causes are many. Attendance has been off, and in fact there were reportedly quite a few empty seats at Saturday’s concert. Critics have blasted the orchestra’s 9 year old home, the Kimmel Center, as visually rewarding but sonically cold. The orchestra’s board indicated that they’d be reviewing the rental fees for Kimmel as they try to emerge from bankruptcy later this year.
Although some smaller orchestras have had to seek shelter from creditors, to my knowledge, Philadelphia is the first major American orchestra to take this step. "We’re in a state of shock, really," said principal oboist Richard Woodhams. "I think it’s a very, very sad day for culture in the United States and the world."