Minnesota Orchestra Reports $1.1 Million Deficit Amid Lockout

For the fiscal year that ended August 31 — a year in which the orchestra performed no concerts because of a contract dispute and lockout — the Minnesota Orchestral Association has reported an operating deficit of $1.1 million.

According to the orchestra's annual report (15 pages, PDF), revenue totaled nearly $12 million, including contributed income of $5.7 million, $3.7 million in draws from endowments, and $2.6 million in distributions from trusts. Earned income, from ticket sales that patrons essentially donated to the orchestra, came to just $14,000. In addition, rental income from Orchestra Hall, which was undergoing a $52 million renovation, was zero.

The $5.7 million in contributions represents a decline of roughly a third from the $8.2 million the orchestra raised the previous year — largely due to the cancellation of the orchestra's Symphony Ball and a decline in donations from individuals, corporations, and foundations from $4.1 million to $2.6 million. The $1.1 million deficit, however, is significantly smaller than the nearly $6 million the orchestra posted in fiscal year 2012, as operating expenses also shrank from $31.5 million to $13 million.

"We are grateful to our many loyal donors who have remained with the organization over the past season. The fact that the organization's deficit is substantially smaller in a year without any performances indicates the degree to which this business model is out of alignment," said board chair Jon Campbell, who, together with immediate past chair Richard Davis, spearheaded efforts to secure pay cuts from musicians and will remain in office until a settlement is reached. "We are hopeful that we've reached a point in negotiations where musicians will choose to join us in negotiating a compromise settlement that helps to address these financial issues and enables the players to return to concerts at Orchestra Hall soon."

"It is of great concern to the musicians that the leadership of the MOA managed to spend $13 million and run a $1 million deficit while producing no concerts," the musicians said in a statement, according to the Minneapolis Star Tribune. "This begs the question as to whether the MOA’s new business model will truly lead toward sustainability or success."

"MOA Announces Year End Results and Elects Board of Directors." Minnesota Orchestral Association Press Release 12/11/2013. "Minnesota Orchestra: Board Reports Deficit of $1.1 Million for Fiscal 2013." Minneapolis Star Tribune 12/11/2013.