By Janelle Gelfand
The Cincinnati Enquirer
Trustees of the Cincinnati Symphony Orchestra will begin to hammer out a proposal to solve the orchestra's fiscal crisis at its monthly board meeting today. The orchestra is faced with a $1.45 million operating deficit for the fiscal year that ends Aug. 31, the worst deficit in more than a decade.
Compounding the challenge, the orchestra has drawn increasingly from its endowment - this year, 8.7 percent - even as the endowment's value has plunged in the poor stock market from about $95 million to $65 million.
If the orchestra returns immediately to its policy of a 6 percent draw to cover its $31 million operating budget, the annual shortfall would be about $3.5 million, board chairman Dan Hoffheimer said last week.
The board will be voting on increasing ticket prices for the 2004-05 season as well as discussing how to bridge the funding gap.
Among cost-cutting and revenue-boosting moves to be discussed:
Increasing ticket prices. Next year's season would have an increase higher than the usual 3 or 4 percent.
Reducing administrative costs.
Raising money through special, one-time gifts; increased annual giving; and larger pledges by trustees.
For the orchestra's largest piece of its budget - its labor costs - Hoffheimer declined to take a position "that would constrain the negotiations" with its musicians, whose contracts expire in late summer. Negotiations for a new contract will begin at the end of May.
"I think there will have to be general across-the-board cuts in most categories," Hoffheimer said. Those decisions will be made through discussions with management and not as a board vote.
Administrative cuts could occur through attrition, Hoffheimer said.
If the board decides that management should make a 5 percent or 10 percent cut in its expenses, symphony president Steven Monder will decide how those cuts will be carried out, such as asking employees to pay a larger share of health insurance costs or taking an unpaid week off, he said.
The orchestra also will step up its gift solicitations.
"We're not going to be unrealistic and ask the community in general to come forward with huge amounts of additional gifts. We're hoping that they increase (pledges) with modest and doable increases.
"But also, we're going to be looking to our special friends to give us one-time, substantial gifts."
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