Symphony likely to break even for season; cash challenges remain
The Seattle Symphony appears close to breaking even for the first time in four years, executive director Simon Woods says, crediting cost-saving measures and donors. However, like most U.S. orchestras, the orchestra's endowment has been hit hard by the recession, and it also needs to deal with accumulated debt.
The Seattle Times
The Seattle Symphony appears close to breaking even for the first time in four years, Executive Director Simon Woods says, crediting cost-saving measures and donors.
Woods said that by the end of the symphony's fiscal year — Aug. 31 — its annual budget will be "at or around breaking even for the first time in four years, which is a really, really significant achievement."
The total operating budget for the 2011-12 season was $24.5 million.
However, the symphony is burdened with $11 million in accumulated debt and is also faced with the task of increasing its endowment.
"This organization has come off some very difficult years financially," Woods said. "All arts organizations have suffered through the recession. We've suffered as much as anybody. And I think the big problem that we have going forward is about our level of debt."
Cost-cutting ("artistic, marketing, administrative costs, consultants, you name it") and what Woods describes as "an incredibly successful year of fundraising" helped balance the annual budget. Roughly $9.7 million was raised, he said, the largest amount raised in the annual fund in more than 10 years. "I think what that tells you is the degree to which the community has embraced the new era here."
Last season was music director Ludovic Morlot's first with the symphony. Woods came on board in May 2011. Key positions in the orchestra have been filled in the last year: principal flute (Demarre McGill), principal cello (Efe Baltacigil) and, most recently, concertmaster (Alexander Velinzon).
Programming aimed at attracting a more diverse audience was also key last year. The symphony collaborated with rock musicians in "Sonic Evolution," combined NASA footage with music in "The Planets" and gave free tickets to children. Morlot and a small group of players even appeared at Bumbershoot.
"The days of symphony orchestras being orchestra organizations which played one kind of music for one kind of audience are truly over," Woods said. "We now have to — and want to — cater for many, many different audiences."
In order to tackle the deficit, the symphony will continue to reduce expenses and raise money. News on ticket sales is relatively good; 45 percent of the orchestra's income comes from ticket sales.
Subscriber numbers have been encouraging, too. During Morlot's debut season, the symphony's roster of subscribers rose from 27,000 to 28,000. "A pretty amazing outcome," Woods says, "as you're introducing a new music director with a new style and with a new repertoire." With single-ticket buyers factored in, total attendance at the symphony was roughly 315,000.
Another issue the symphony needs to address if it's to recover its fiscal health, Woods said, is the small size of its endowment.
"We only have around $25 million in endowment," he says, "and that is simply not a number that is sustainable for an organization this size. ... You can attribute big chunks of the debt that has been incurred over the last decade to lack of endowment."
Endowment funds, which are separate from year-to-year operating expenses, are invested with the intention that they'll yield income for the symphony. The economic meltdown of 2008, naturally, cut into the incomes of orchestras across the country.
It's too early to say what the optimum amount of endowment needed by the symphony is, Woods said, but that will be studied in the coming months.
"This is a critical issue that we have to address in order to position the symphony for stability and growth in the next 50 years — for this generation and the next."
A final contributing factor has been growth of the board. Twenty new members have been added in the last year and a half, Woods said, for a total of 57. And some of those new board members have been "exceptionally generous," he added.
Woods' final words are cautiously optimistic.
"Yes, there are financial challenges," he said, "and, yes, we have our debt to overcome, as do many American orchestras. This is one of the toughest times for American orchestras we've seen for a very, very long time."
Michael Upchurch: email@example.com