With an announced operating deficit of nearly $9 million in fiscal 2019 and facing contract negotiations with musicians this year, the Minnesota Orchestra makes me nostalgic for those grand old days of 2012-14.
You recall, that’s when the orchestra locked out musicians for 16 months in a brutal labor fight that made Minnesota a dirty word in the symphonic world. Musicians settled for a 15% pay cut, but in a shrewd series of maneuvers they claimed the heads of administrative and board leaders who had presided over the mayhem. Ah, good times.
One should never say never in the mercurial world of collective bargaining, but it seems unimaginable that the current financial difficulties and open contract will produce another conflagration approaching the trauma of 2012-14. First, humans tend to avoid repeating horrible experiences. Second, the orchestra culture has been revamped.
“I don’t know how there couldn’t be,” said principal trombone Doug Wright, when asked if scars still show within the orchestra. “In terms of trust, as a whole this organization trusts itself and we all sense that there is a large issue in front of us [the deficit] and the best way forward is to work on it.”
Amen, brother. But as the old saying goes, the highway to hell is littered with good intentions. Once the parties have sung a lusty chorus of “Kumbayah,” the devil will emerge in the details of a contract that gets the musicians what they need and somehow recognizes that the historic $8.8 million gap in operations is real.
Sometimes it takes a fist fight to clear the air. Management and musicians in 2012 were both eager to step outside and settle this thing. Some board leaders felt they had been chumped in the 2007 contract talks and wanted payback. They threw down the first ploy in early 2012 with a proposal that would have cut wages an average of 35%.
The musicians, on the other hand, were not loving the bosses for reasons that might be summed up as “high handedness.” Once they convinced themselves that the board was serious, the musicians refused to dignify the proposal with a counter and instead mounted a public-relations campaign, dragged CEO Michael Henson over to the Legislature, where sympathetic lawmakers put him in the stocks, and played rope-a-dope until the fall 2013 opening of newly remodeled Orchestra Hall.
The hope was that the steady stream of bad publicity would have the board sobbing in the bunker, begging to make a deal. But management — at least in public — didn’t flinch. Even the threatened (and eventually realized) departure of music director Osmo Vänskä didn’t deter board leaders. In the end, the 2012-14 debacle was a textbook primer in the art of underestimating your opponent’s resolve.
There was a meme whispered frequently and with some confidence following the 2014 settlement: “This deal could have been done a year earlier.” Indeed, the kind of numbers that ended up in the contract were murmured off the record throughout 2013.
But this retrospective optimism shatters on the firmest facet of collective bargaining: there is no deal until there is a deal. Personalities, egos, stubbornness, slights and arrows are as much a part of the game as logic. As Wright said to a reporter in the fall of 2013, “This isn’t just about money.”
Rising from the ashes
As the smoke lifted, the orchestra stumbled into a miracle. Kevin Smith — retired after 20 years as president of Minnesota Opera — was essentially standing on a street corner wondering what to do next. Henson had left, so the orchestra’s new board leaders asked Smith to help out. He soon remade the organization in his own image. Cooperation and honest assessments replaced conflict and confrontation.
Smith asked his friends in the philanthropic community to rebuild the orchestra. Landmark trips to Cuba and South Africa, concerts at Carnegie Hall and a renewed enthusiasm followed. Ironically, the steep cuts in the 2014 labor deal allowed Smith to offer small increases in a new pact that was hammered out following the Cuban lovefest in 2015.
Smith stepped down in 2018 with nary a mark on his face and handed the organization over to new CEO Michelle Miller-Burns. Ambitions remain undimmed, with a southeast Asian tour planned for this year and a steady stream of guest conductors informally auditioning to replace Vänskä when he retires in 2022. On strictly artistic terms, the orchestra always has punched over its weight class.
A Sisyphean task
There is an immutable truth in the symphonic world — and for that matter the nonprofit performing arts world: every year, you will roll the rock up the hill to plug the financial hole; and every year you will do it again. Henson and the board leaders in 2012 thought they would solve that by cutting $5 million from labor costs. Smith relied on philanthropy. Miller-Burns seems geared to do the same, although she is directing some work groups at the orchestra to find ways to increase earned revenue — a laudable effort but unlikely to move the needle much.
The orchestra’s 2019 financial report was both disturbing and hopeful — if that’s possible. Ticket sales were generally stable at about $7.2 million. Attendance was off a little but historically consistent.
Philanthropy, though, is where it’s at, and here is the orchestra’s paradox: Donors more than satisfied a $50 million capital campaign concluded in 2019. Good news, right?
Yes, but. The campaign’s original goal was to raise $40 million for operations and $10 million for endowment (money that is invested). Instead, $40 million was raised for endowment and only $20 million for operations. Donors preferred 2 to 1 to give to an endowment that would preserve their investment — a legacy gift — over filling the budget holes that recur every year. The lower figure for operations, combined with a dip in earned revenue — ticket sales, concessions, rentals, etc. — resulted in a drop of more than 30% in the orchestra’s total revenue from fiscal 2018. To state the obvious, that is unsustainable. How can the leadership get more contributions steered to annual giving?
Which finds us in the current reality — a stiff financial situation and the need to strike a deal with musicians who feel (with justification) that they have done everything they have been asked to do. There will be “a healthy tension” as negotiations begin, Wright said, with musicians harboring priorities they cannot let go of, but willing to help bring in a few more bucks. Miller-Burns and the board have said the right things, but happy talk will go only so far in addressing the reality that there was an $8.8 million operating deficit last year and musicians need a new contract.
It does seem beyond reason that we will see a repeat of 2012-14. Take that bet at the same time you put down a sawbuck on the Vikings not winning the 2021 Super Bowl. But, you know, sometimes the ball bounces weirdly and the game gets away from you.
Graydon Royce is a former arts reporter who covered classical music for the Star Tribune.