San Francisco says it can’t afford Esa-Pekka’s ambitions

The SanFran Symphony wishes, it says, ‘ to communicate additional context around some difficult decisions with the many members of our organization and community who care deeply about this institution and its future.’

The bottom line is a $116 million loss.

Here’s some of the heavily massaged message that they have uploaded on the website:

For many years, the Symphony’s expenses have exceeded its revenue, and in recent years that gap has been growing. In several of the most recent seasons, including 2022–23, the Symphony received extraordinary one-time gifts or pandemic-related federal aid that have helped to reduce, but have been insufficient to consistently close, the gap between revenue and expense.

For reference, in 2022–23, the Symphony’s operating expenses totaled $78.6 million, while operating revenues, exclusive of extraordinary one-time contributions, totaled just $67.4 million. Revenues to support expenditures come predominantly from three areas: earned revenue (primarily ticket sales and performance fees; $26.9 million in 2022–23), contributed revenue (primarily individual donations, corporate, foundation, and government support, and fundraising events; $25.3 million in 2022–23), and the endowment draw ($15.2 million in 2022–23).

Factoring out investment gains/losses, which do not provide direct cash to support operations, the Symphony has incurred a cumulative operating deficit of $116 million over the last 10 years. Those losses have been funded primarily through non-repeatable sources including federal COVID relief and drawing down the Symphony’s operating reserves. Without immediate action or extraordinary new funding, we anticipate that our cumulative cash losses could grow by an additional $80 million over the next five years, far beyond any means of funding such losses. It is in the face of that unsustainable future that we have begun to make some difficult choices… with the goal of emerging as a stronger, more innovative, and more community-oriented institution than ever before.

Temporary near-term actions
To this end, we have implemented a series of temporary reductions to some programs to better scale our activities to fit within available resources. Near-term actions include reducing the frequency of SoundBox programs, semi-staged productions, and commissions of new
compositions so that these activities can be sustained by existing restricted endowment support and/or dedicated funding. Practically speaking, this means that we will retain two SoundBox programs per season, one semi-staged production every two to three seasons, and approximately four to six new commissions per season.

We have also paused future touring activity because we do not have the necessary funding to support it at this time. The Concerts for Kids program continues to be on hiatus due to a lack of dedicated funding while we continue to focus our efforts on other education initiatives, including Adventures in Music (AIM) and Music and Mentors, part of our longstanding partnership with SFUSD; Music for Families; and our tuitionfree Youth Orchestra.

It is important to note that the reductions we have made are not intended to be permanent, and do not signify a lack of commitment to these important areas of the Symphony’s artistic output. Even in the near term, we remain committed to maximizing our impact in each of these areas to the greatest extent possible within the level of funding currently available. Moreover, we will continue to seek new funding that we hope will enable us to restore these important initiatives in the future.

More here.