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Declining contributions and sponsorships have put the orchestra in a position where it cannot make its payroll through April. The board of directors decided to halt operations starting today and cancel its remaining performances this spring. The board will try to restructure its operations in hopes of presenting a 75th season in the fall.
By Ashley Fletcher Frampton
aframpton@scbiznews.com
Published March 29, 2010
Faced with the reality that it could not make payroll through April, the Charleston Symphony Orchestra announced Sunday it would suspend operations for the rest of its season.
The organization is looking at ways to restructure and cut operating costs in hopes of presenting a 2010-2011 season in the fall.
But cutting expenses without sacrificing quality will be a careful balancing act, said Ted Legasey, president of the board of directors.
The board voted Thursday to suspend
all operations as of midnight Sunday. That means cancelling the remaining “Masterworks” performance that was scheduled for mid-April along with six or eight other performances planned in conjunction with community and business events through May.
Legasey said the Charleston Symphony Orchestra has walked a financial tightrope for years. Nine out of the last 10 years, the organization has fallen short of its operating budget. Carrying forward those shortfalls has made operations increasingly challenging.
The troubled economy has further complicated the revenue picture.
Ticket sales represent about 35% of the Charleston Symphony Orchestra’s operating budget, which was set at $2.4 million this year. Grants make up about 10%, and donations and sponsorships comprise the rest.
“Tickets are doing fine. Grants are doing OK. It’s
the fundraising that’s off,” Legasey said.
He said the organization’s top 10 donors contributed a combined $680,000 last year. This year those contributions totaled about $253,000.
“It’s this economy that we’re sitting in and the inability of people and organizations to really support entities like the symphony in the way that they have historically,” he said.
The situation reached a breaking point as officials looked at its next few payrolls. Legasey said the organization paid its eight staff members, 34 musicians and its music director on March 26 but would have been short for the next biweekly payroll on April 9.
“The next one, April 23, the bottom falls out,” Legasey said. “And we can’t see any cash.”
Legasey said the board did not want to reach a situation where staff had worked hours for which they could not be paid.
“If we failed to make a payroll we could be forced into bankruptcy,” he said.
Were it not for two bequests to the Charleston Symphony Orchestra totaling $500,000 last year, the board would have been faced the with this situation last September, Legasey said. That one-time contribution temporarily plugged the budget holes.
He characterized the board’s decision as “pressing the pause button.”
“We are going to bring our expenses way down and try to survive,” he said.
Because wages and benefits represent 75% of the organization’s costs, Legasey said reducing expenses will require a change in the way it employs musicians.
The board will consider keeping fewer musicians on the payroll moving forward, he said. Instead, it could hire more musicians for specific performances on a contract basis.
Orchestras use that model, known as “per-service,” to varying extents. The Charleston Symphony Orchestra has used it, for example, if a concert requires more violinists than it has on staff.
But taking that employment model to an extreme and eliminating most or all regular musicians can affect the quality of musicians the Charleston Symphony Orchestra is able to find, Legasey said.
“If you’re not able to line up the right per-service people, that’s going to affect the quality of the performances you put on,” he said. “If you put on lousy performances, what good is that to the community?”
Next season would be the Charleston Symphony Orchestra’s 75th. Legasey said whether the organization continues will depend on community support as well as budget cuts.
Many performing arts organizations in Charleston and across the nation are financially strapped because of dwindling contributions, though none locally have suspended operations, he said.
“We are the largest performing arts organization in all of South Carolina,” he said. “So we are the ones most likely to encounter this, and we did.”
The Charleston Symphony Orchestra is offering refunds for tickets already purchased. Details are on the organization’s Web site.
Reach Ashley Fletcher Frampton at 843-849-3129.
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