The View From Where We Sit

The View From Where We Sit:
A Summary of Issues in our Contract Negotiations

The Orchestra:
The Musicians of the Minnesota Orchestra are fortunate to contribute to our state’s thriving arts community and high quality of life. We are proud to be a part of Minnesota’s largest arts organization, one with a 110-year legacy of artistic excellence. Hailed in 2010 as “the greatest orchestra in the world” by New Yorker critic Alex Ross, the Musicians are committed to preserving the artistic excellence of this storied ensemble. We perform over 200 concerts per year, introduce 75,000 children to great orchestral music, and are deeply engaged in the community as volunteers and teachers.

The Finances:
The Musicians of the Minnesota Orchestra are deeply grateful for the generations of dedicated audience members, board members, volunteers and donors who have sustained this great arts institution. Minnesotans have demonstrated their love of and support for great music by contributing to an endowment, which, at nearly $140 million in 2012, is the sixth largest orchestra endowment in the United States.

The Minnesota Orchestral Association (MOA) has raised an additional $97 million of a $110 million Building for the Future campaign, $52 million of which is committed to the renovation of Orchestra Hall’s lobby. In response to the economic downturn, musicians contributed $4.5 million in financial concessions in 2009 and have contributed further savings through a temporary reduction in the size of the orchestra.

The Proposals:
The Minnesota Orchestra Association (MOA) has made two, nearly identical proposals to the Musicians of the Minnesota Orchestra, a first and a final, both extreme in the breadth and depth of the cuts proposed. The MOA has rejected three proposals by the Musicians of the Minnesota Orchestra:

  • The Musicians offered to submit to impartial, final and binding arbitration under the guidance of the Federal Mediation and Conciliation Service. The MOA rejected this offer.
  • The Musicians offered to “play and talk” with a guarantee not to strike while continuing to negotiate. The MOA rejected this offer.
  • The Musicians proposed a joint, forward-looking independent financial analysis. The MOA rejected this offer. 

The Musicians were locked out on October 1. Health insurance and all other benefits were cut off without notice, and a large portion of the season was cancelled. 

Cuts and Consequences:
The MOA’s contract proposal includes 30% to 50% pay cuts to musician salaries and a significant reduction in orchestra size. In addition, annual healthcare cost increases would amount to $5000-$8000 annually per musician. Draconian cuts to every aspect of our contract would diminish the orchestra in rank nationally from No. 8 to 16, behind cities such as Detroit and Cincinnati. The Minnesota Orchestra would fall from its position as an esteemed, world-class ensemble to a third-tier orchestra, making it no longer possible to attract or retain the finest musicians. We will see further flight of talent from our critically acclaimed team to other orchestras with more competitive salaries and benefits.

The proposal also includes more than 250 changes to a contract which has been crafted over many years to support the quality of our core product, great performances of classical music. As confirmed by industry analysts across the country, these proposed changes and cuts will fundamentally and irrevocably change the orchestra and negatively impact its legacy of artistic excellence.

Audit versus Analysis:
The financial information that the MOA has disclosed to the Board and Musicians is contradictory, outdated, confusing, and incomplete. The musicians have proposed a financial analysis by a mutually agreed upon independent firm so that all stakeholders would view the results as credible.

The audits that the MOA has offered are based exclusively upon historical financial statements provided to an auditor. These reports focus solely on limited areas of past performance. Audits do not cover an institution’s viability, stability, business plan, strategic plan, the quality of its management, comparative performance, or present and future prospects. A joint, independent financial analysis would review all of these things and would assess current and future trends, opportunities and risks.

Investors and lenders typically rely upon financial analysis, and not merely past audit reports, when making financial decisions. In effect, management is asking its musicians to make an “investment” of $5M annually in concessions, without permitting the kind of financial analysis any rational investor or lender would require.

Bait and Switch:
Donors to the Building for the Future campaign contributed under the premise that a world-class orchestra deserves a great hall. The stature of the orchestra was used to court contributors who were not told that renovating Orchestra Hall would come at the cost of the orchestra’s quality and reputation. So that fundraising for the lobby renovation and expansion could continue unabated, management balanced the budget for the years 2008-2010 through unpublicized endowment draws.

The New Business Model:
The current MOA leaders have embraced an incorrect premise that there is a reduction in demand for classical music. They have put forth a new business model focused on operating Orchestra Hall for commercial music presentations while presenting fewer classical concerts by a severely diminished orchestra. The new model was developed and the mission statement rewritten in secret, out of view of vested stakeholders (audience members, donors, musicians, taxpayers). It lacks artistic vision and belief in the great performances of classical music for which the Minnesota Orchestra has been acclaimed, both nationally and internationally.

The new business model cannot and should not take the place of attention to artistic quality, marketing, community service, innovation, and education. The current management of MOA has failed to study and emulate successful models such as Boston, Chicago, Los Angeles, San Francisco and others. These orchestras are offering creative programming, launching innovative initiatives, and increasing ticket sales.

The Twin Cities have high per capita arts attendance. By all measures, the Twin Cities are stronger in economic health and outlook than many metropolitan areas, yet the MOA has fixated on the financial challenges of orchestras in cities with weaker economies. Yet the Cleveland Orchestra, an orchestra with a smaller endowment in an economically weak city, concluded successful contract negotiations in October in a notably swift and uncontentious manner.

Conclusion:
The MOA proposal puts the future of the Minnesota Orchestra at risk. The new business model is incompatible with Minnesota’s great tradition of arts culture. Orchestras with a history of extreme cuts have not continued to serve their communities long term, and no orchestra has ever successfully moved itself into prosperity by intentionally diminishing the quality of its own product.

The Minnesota Orchestra needs inspired leadership that believes in the transcendent power of great music and recognizes that artistic excellence is essential to our long-term financial stability.

We are the Musicians and we thank you for listening.