Philadelphia players: Board blew $10 million on bankruptcy

The musicians in Philadelphia are out of contract. If they can’t get a new deal soon, the orchestra will be back where it was five years ago – shut down and bankrupt. The atmosphere is souring.

Read what the musicians have to say:

It has been more than five years since the Board of the Philadelphia Orchestra voted to file for bankruptcy, becoming the first major American orchestra to do so.  At the time, the Orchestra had a $140 million endowment, owned the Academy of Music, and had no debts, according to an NPR article from April 18, 2011.

Although the filing in April, 2011 was opposed by the musicians, the public was told that it was a necessary step, and that when the Orchestra emerged from bankruptcy, things would be much better.

When the court approved the bankruptcy, the Association made wholesale changes to our pension plan. The Plan was frozen and its administration was transferred to the Pension Benefit Guarantee Corporation, a U. S. government entity. Some musicians may receive lower pensions than they would have earned under the frozen Plan. The retirement benefits which were substituted for the Plan do not guarantee the benefit level specified in the Plan. In addition, the orchestra musicians, who had voluntarily taken a wage freeze the year before, and who had donated a significant amount of money to the Association, saw their salaries reduced by more than 14 percent.  The size of the orchestra was also reduced, from 106 full-time positions to 95.

The Association, according to the Philadelphia Inquirer’s Peter Dobrin, spent “almost $10 million in professional fees and expenses” on the bankruptcy, and paid settlements of $1.75 million to the American Federation of Musicians Pension Plan, and $1.25 million to the Philly Pops in the process.

More than five years later, Musicians hoped that the Association would view the bankruptcy as a temporary means to regroup and ultimately restore the kind of budget that is necessary to fund a major symphony orchestra, rather than as a way to downgrade the musicians’ contract permanently. More than five years later, we are still waiting….

The regressive contracts under which we have worked since the bankruptcy have saved the Association millions of dollars.  We have patiently endured cuts to our salary, pension, and health care. It is time to move forward and restore us to our proper place in the pantheon of orchestras.

 

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  • Philly needs to follow the advice of Chicago SO Music Director Riccardo Muti:

    “You cannot maintain a great orchestra at this level if the refrain is constantly ‘we have to cut this and cut that,’ ” he said in an interview in Chicago. (The CSO Association reported a $1.3 million operating deficit for fiscal 2015, its fifth such deficit in a row.) “In the end, that becomes demoralizing to the musicians. I am not telling everyone to just open their wallets — we must be realistic. But I would like to see everyone in the institution support this great orchestra with the same fire the musicians bring to their performances on their best nights.” (Chicago Tribune)

      • My favorite is Gustavo Dudamel, who continues to stubbornly support the flailing and failing Chavez/Maduro regime in Venezuela from his perch atop LAPO, making Lord-knows how much money in salary and benefits. “Socialism for thee but not for me,” evidently …

      • Muti’s official title is Zell Music Director, his salary is funded by a separate $17 million restricted endowment by the Zells. Deficit or not, Muti’s pay is independent of the fortunes of the orchestra.

        Individuals are free to endow principal chairs, or the podium, rather than the orchestra as a whole.

        Anyone who doesn’t like that Muti is endowed by the Zells with $17 million is free to endow the orchestra with his or her own $17 million.

  • “Musicians hoped that the Association would view the bankruptcy as a temporary means to regroup and ultimately restore the kind of budget that is necessary to fund a major symphony orchestra, rather than as a way to downgrade the musicians’ contract permanently.”

    Oh, the delicious naiveté. Of course a permanent downgrade was their goal.

    IMHO the only way (probably) is to do what Minnesota did: get rid of all the board members who were trying to stunt the orchestra, and replace them with people who share your vision.

    • One only hopes that that’s possible! Not shown in their post is that the POA stiffed the American Federation of Musician’s pension fund out of circa $31million withdrawal liability fees during the bankruptcy and got away with it. Evidently, the fix was in with the judge who allowed it.

  • The bankruptcy was an ill thought travesty. The result was the money went to the bankruptcy lawyer and not to the players. Like everything else in Philadelphia, it is about patronage. Philadelphia may deserve an orchestra, but not its self-serving board and executive staff. Mark D. Schwartz, Esquire (markschwartz6814@gmail.com)

  • Long live the ‘Per Service’ remunerated orchestras; the salaried orchestra model is no longer viable in the USA. And yes, you’re overpaid when the community cannot afford you any longer. Look at the London model of Symphony Orchestras and you’ll probably have a chance to survive. Be quick though…

    • Yeah sure. After all, the community could put the money they’ll thus save towards something “useful”. Like, say, building another sports stadium that no one wanted or needed in the first damn place………

    • you seem to be saying you don’t know the difference between a world class musician (“salaried”)orchestra and a pick up band. have you even heard the Philadelphia Orchestra?

  • Salaried orchestras no longer viable? Michael Kaiser made a “secret” report (almost immediately leaked by someone on the board) to the Philadelphia Orchestra board outlining what they needed to do financially and artistically to grow the organization back to Big 5 status. Kaiser is America’s preeminent arts leader and he said that the Philadelphia area had the means to support the Met! Some on the board have given generously, particularly the chairman, but others are sitting on their multi-millions. If they aren’t paying their fair share of taxes in England or the US they should at least give some to the organizations that make their cities great places to live.

    • Pablo wrote:

      “…Some on the board have given generously, particularly the chairman, but others are sitting on their multi-millions. If they aren’t paying their fair share of taxes in England or the US they should at least give some to the organizations that make their cities great places to live.”

      The problem is that America’s super-rich don’t know or give a damn about the arts, especially classical music. You can’t make a fast buck with it. “He who dies with the most toys wins.” And you don’t have the most toys when you donate a small sliver of your fortune to a symphony orchestra.

  • Once again an American orchestra looks to be in trouble. As I have said time and again, the finger has to be pointed directly at the Board, its Chairperson and the Executive Director, that same Alison Vulgamore who left Atlanta in such a mess. Her salary may be relatively small but she has a large stack of other benefits, including $2,000 annually to pay for her personal financial consultant!! Patently that’s idiotic! No doubt also the quack Michael Kaiser’s potions deserve more that their fair share of blame.

    • A valid point. All those consultants that send you an invoice for telling you in a fancy way what you already know… . Everybody in the industry knows how much $$$ are wasted here… . A complete tabula rasa is necessary at the POA; from the ground up guys as this orchestra has been mismanaged for years.

      • A consultant is:

        1) Someone who borrows your watch to tell you what time it is. Then they keep your watch.

        2) Someone who tells you a million ways to have sex but doesn’t know any women.

        3) Someone who comes in to solve a problem and stays around long enough to become part of it.

        4) Like a prostitute. Both are screwing their clients.

  • The AFM pension plan is a disgrace. If one makes the same money over the same period of time as a person who retired 15 years ago, they will get less then 1/5th the benefits. Now we are forced into this contribution without the ability to pay the pension benefit directly to the musician to invest as they wish. This is slave labor- a disgrace to the function of a union

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