The 111 year old Philadelphia Orchestra became the first world-class orchestra to file for bankruptcy amid the financial morass currently plaguing American orchestras. However, unlike the Syracuse Symphony, the Philadelphia Orchestra did not cancel any performances or order an organization-wide shutdown. The season will continue as planned, but the future of the organization will depend on the proceedings in bankruptcy court.

While the move was expected, many feel it was unnecessary. The orchestra has assets, including an endowment, that total $140 million—three times its current liabilities. Management views the endowment as donor-restricted and therefore unusable, which means the orchestra is currently operating with a deficit. An emergency fundraising campaign is projected to reduce the $13 million budget gap to around $5 million, but the board is hoping to shed millions in liabilities during bankruptcy proceedings.

Only the 5 musicians sitting on the 75 member board voted against the measure despite campaigns by the players to reject the move. Orchestra members handed out leaflets encouraging members to vote “no,” even protesting the meeting with a “play in”—that is, a string quartet serenaded the board members as they gathered to vote. The financial restructuring of the organization could mean less pension funding for orchestra members.

Many people blame poor management for the move, saying that ennui replaced the necessary dedication to raise funds—that expanding the donor pool and reaching out to the community were viable methods of closing the budget gap that were not pursued. Either way, the group is now at the mercy of the bankruptcy court which may decide to dismiss the case if they feel the orchestra has too many assets to warrant the chapter 11 filing.

While players and audience members remain optimistic for the future of the orchestra, they fear the financial crisis will hinder its quality. Cultivated through a rich history of strong leadership and solid players, the orchestra faces a threat that might force musicians to consider taking other auditions. After time without a permanent executive director, music director, or board chair, it is easy to wonder whether it is the economy or simple stagnancy that is to blame for the ensemble’s suffering.

See also:
Philadelphia Orchestra’s board votes to file for bankruptcy
by Peter Dobrin via Philadelphia Inquirer
Philadelphia Orchestra To Seek Bankruptcy Protection
by The Associated Press via NPR
Philadelphia Orchestra Makes Bankruptcy Move
by Daniel J. Wakin and Floyd Norris via New York Times
Board of Philadelphia Orchestra Votes to File for Bankruptcy
by Daniel J. Wakin via New York Times

Posted on April 22nd, 2011 at 6:05 pm | Filed under Articles of Interest, General |