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THE
SAVING OF A SYMPHONY
By JONATHAN SCHLERETH
On July 26, 2001, the Saint Louis Symphony Board of Trustees heard
that the world-renowned Symphony would be bankrupt in 13 months,
unless they could raise $29 million and cut $7.5 million in annual
operating costs. The Board sat in disbelief and dismay at the startling
possibility that they might witness the Symphony’s final performance.
Yet, a consensus soon grew among the board members: they would save
the Symphony.
In the months leading up to the meeting, Dr. Virginia Weldon, chairman
of the board, and Don Roth, then president of the Symphony, had
seen the warning signs. Roth, who resigned just prior to the July
board meeting, had replaced the CFO and with outside help had begun
upgrading the financial reporting systems. By the time of the meeting,
the situation was painfully clear and detailed for the board by
Randy Adams, who had been retained to analyze the financial situation
and develop a long-range plan. Not long after Roth’s resignation,
Adams was hired as president and executive director.
It was a shocking turn of events only a few short months after the
announcement of the $40 million Taylor Family Challenge in December
2000. Earlier in the year, Dr. Weldon and board member John R. Jordan
Jr. began meeting with members of the Jack Taylor family regarding
a major gift to the organization. Taylor, the founder of Enterprise
Rent-a-Car, “vividly remembered coming to Kinder Konzerts,” Weldon
says. “And his mother was a pianist, so he grew up with music in
his home. He knew that the Symphony was in trouble and that it was
a matter of survival.” The Symphony was given until December 31,
2004, to match the Taylors’ $40 million.
Also in 2000, Dr. Weldon began planning to reorganize the Symphony’s
governing body, working with board members Richard A. Liddy and
Donna Wilkinson. Dr. Weldon, Roth and the governance and nominating
committee reviewed other orchestras for a year to learn of an ideal
board size and to develop a board expectation document. This document,
the first of its kind, clearly conveys board responsibilities and
characteristics. The responsibilities include commitment, advocacy
and fundraising. The characteristics cited include a passion for
music, community programs, education, distinction in a profession
and St. Louis. Board diversity is another key element. Members are
also expected to give generously, act as ambassadors to the community,
and actively support and participate in the governance process.
The Saint Louis Symphony Orchestra Executive Committee
(Back Row left to right): RANDY ADAMS,
RICK A. SHORT, JOHN R. JORDAN Jr., GARY
SMITH (Front Row left to right): JO
ANN TAYLOR KINDLE, Dr. VIRGINIA V. WELDON,
GLORIA W. WHITE, ANN M. SULLINS, LAWRENCE
P. KATZENSTEIN (Members not present): C.
ROBERT FARWELL, JO ANN HARMON, Dr. WILFRED
R. KONNEKER, RICHARD A LIDDY, MARY E.
MEYER |
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In January 2002, several board committees were merged and trimmed
in size to streamline the governance process. The executive committee
that originally had 26 members has only 14 today. The board of trustees
was cut nearly in half, from 88 members to 49, and two musicians
were added. A board of overseers was created, consisting of emeritus
trustees and life trustees.
While the restructuring effort was taking place, the campaign to
raise $29 million in stopgap funds began in earnest after the July
board meeting, and after the Symphony made its predicament public.
“We quickly determined that we would have to go to individuals or
families,” Adams says. “Corporations could not really help us in
this case, because they’d spread the funds out over a number of
years. We invited a number of individuals to a special meeting and
described our plan to them. We had an opportunity to save the Symphony
and asked if they’d be willing to participate.” Many were. The board
and the donors raised $31 million for the Symphony’s immediate needs,
including repayment of debt associated with recent deficits. However,
to put an end to the multimillion-dollar deficits, the organization
needed to cut $7.5 million in annual operating costs beginning with
fiscal 2003.
To reduce costs, the Symphony decided to end the Queeny Pops Series,
which had seen declining audiences for many years, and the Pops
at Powell series. The Saint Louis Symphony Music School, another
source of red ink, has now become the Community Music School of
Webster University and is a department of the Leigh Gerdine College
of Fine Arts.
For other savings, they went to the musicians. The musicians agreed
to take a 10 percent pay cut in a collective bargaining agreement.
“There are a number of musicians who were sophisticated about financial
matters,” Adams says. “And when we showed them all the numbers,
they understood it was a very, very serious situation and the old
solutions were gone. Their attitude was that it is no longer about
how you’re going to divide up a pie, but how you’re going to keep
it. Every musician that plays in our orchestra is a permanent member
of this community. Many of them have been with the Symphony 20 years
or more. They feel strongly about this organization and this community.”
The entire organization received a boost when Itzhak Perlman was
announced as music advisor, a role in which he will perform some
of the behind-the-scenes duties of a music director while the Symphony
searches for a successor to Maestro Hans Vonk, who resigned in May.
“Perlman’s willingness to become music advisor is a fine portrayal
about how strongly some feel about our Symphony. It was an enormous
morale lift,” Adams says. “This commitment by someone who has played
with the best orchestras all over the world, that he’s willing to
invest his name and time with us, shows what a great orchestra we
have in St. Louis.”
While costs have been cut and stopgap funds have been secured, raising
an endowment and matching the Taylor Challenge continues. “Endowments
are a fundamental part of the funding of a successful symphony,”
Adams notes. “That was always the major problem. This organization
operated on an annual budget and that’s as far forward as they looked.”
Many corporations and community members were pessimistic about giving
the Symphony money. “There were a lot of questions in the community,
our track record wasn’t that good,” Weldon says. In response to
these questions, the Symphony created a long-range business plan.
“Two sophisticated business leaders looked at our plan in great
detail,” Adams says. “We passed their examination with flying colors.
That was a good seal of approval.”
The Symphony has now created an endowment trust, from which it will
have an annual 5 percent draw. The principal cannot be touched.
Adams and Weldon are optimistic that they will meet the Taylor Challenge,
but indicate the need to surpass this goal. “We believe we need
a $150 million endowment to be truly competitive on the national
and international stage,” Adams says. “How long will it take to
get there? I don’t know, but we’re going to try.” Since the Challenge
began, the Symphony has raised $26.5 million toward its endowment.
The endowment will likely reflect how involved the Symphony is within
the community. Over the past year, the Symphony estimated that 290,000
people attended a performance by the Symphony’s musicians, a third
of which were seen in churches, schools, parks and civic centers.
“We’re bringing our art to the people,” Adams says. “And close to
45 percent of our audience sees us for free or for a nominal charge.”
This summer the Symphony continued to bring its art to the people
in five outdoor concerts and attracted more than 33,000 people,
a major success, say Adams and Weldon. “The Symphony must be relevant
to a broader base of people than just our core audience,” Weldon
notes.
“Our goal, when our time here is finished, is to leave the Symphony
financially strong and artistically great,” Weldon says. With recent
grants from organizations such as Edward Jones, AmerenUE, Emerson,
and the Anheuser-Busch Foundation, to name a few, the Saint Louis
Symphony Orchestra is well on its way to matching the Taylor challenge
and re-establishing its position as a world-class organization.
Jonathan Schlereth is a freelance writer based in St. Louis |
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