The Met: last season's deficit up, as predicted

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John F
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The Met: last season's deficit up, as predicted

Post by John F » Fri Nov 21, 2014 7:56 am

The Met's increased deficit for 2013-14, a factor in last summer's labor negotiations, is at least as bad as Peter Gelb said it was going to be. But a combination of concessions from the unions, cutbacks in overhead, and an improved box office so far this season, may bring the budget into balance soon.

Metropolitan Opera’s Deficit Swells to $22 Million
By MICHAEL COOPER
NOV. 20, 2014

The Metropolitan Opera’s deficit ballooned to an estimated $22 million last year, the company said Thursday, as weaker-than-expected contributions and ticket sales combined with expenses related to the company’s labor talks to create its most serious shortfall in decades. It is hardly a secret that the Met has been having financial troubles — that is why the company sought, and ultimately won, concessions from its unions and agreed to make cuts of its own. But the scale of last season’s shortfall puts the company’s challenges into stark relief.

The deficit for the 2013-14 season was roughly eight times that of the previous season. Calculated as a percentage of the budget, it was the Met’s biggest deficit since 1984. The 2013-14 season shortfall amounted to nearly 7 percent of its overall budget of roughly $316 million, according to preliminary financial data; the 1984 deficit was about 10 percent of the budget.

“The looming operating deficit for last season was a warning call,” Peter Gelb, the Met’s general manager, said in a statement. “It’s what compelled us to seek concessions in the union negotiations. Looking ahead, by adopting a leaner, streamlined business model in combination with a larger endowment, we will place the company on safer financial footing.”

Things are looking brighter this year: In addition to cutting expenses, the Met said that its box-office revenues are already $2 million higher than they were at this point last season, and that donations are expected to increase now that its labor dispute had been settled.

The Met began reducing its expenses last year — its budget fell to $316 million from $327 million the year before — but the falloff in contributions and underperformance at the box office in that period meant that revenues still fell short of expenses. Its contentious labor talks, which at one point threatened to delay or cancel the current season with a lockout, imposed costs of their own.

A number of one-time expenses related to those talks added roughly $4 million to last year’s spending, Met officials estimated. Those ranged from legal fees, to the severance pay given to the unusually large number of employees who retired, to unexpectedly high medical costs, some of which may have been incurred by people seeking care before any lockout threatened their coverage.

The Met expects the labor and management cuts it agreed to this summer to save it $18.5 million in the current fiscal year and $22 million when they are fully phased in the following year, which it projects will balance its budgets. The company’s unions agreed to their first pay cuts in decades; management eliminated 22 positions, mostly through layoffs; some of the company’s biggest stars agreed to voluntarily cut their fees; fees to vendors and consultants have been reduced by 7 percent; and the Met is working to save money this season by scheduling rehearsals to involve less overtime pay and by trimming the number of people required for some operas.

The Met is also preparing for a campaign to double its endowment, which was valued at $265 million at the end of July.

http://www.nytimes.com/2014/11/21/arts/ ... llion.html
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Re: The Met: last season's deficit up, as predicted

Post by Chalkperson » Sat Nov 22, 2014 2:00 pm

The Met's increased deficit for 2013-14, a factor in last summer's labor negotiations, is at least as bad as Peter Gelb said it was going to be. But a combination of concessions from the unions, cutbacks in overhead, and an improved box office so far this season, may bring the budget into balance soon.
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Re: The Met: last season's deficit up, as predicted

Post by Chalkperson » Sat Nov 22, 2014 2:02 pm

i saw this article elsewhere, that poster wondered just how large the Police bill would be for Klinghoffer.
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Re: The Met: last season's deficit up, as predicted

Post by jbuck919 » Sat Nov 22, 2014 2:32 pm

I think the Met opera house would make a nice converted parking garage for the rest of Lincoln Center, supplementing the existing underground one and perhaps extending a subsidy to what is left of high musical culture in New York City.

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Re: The Met: last season's deficit up, as predicted

Post by Chalkperson » Sun Nov 23, 2014 2:02 am

jbuck919 wrote:I think the Met opera house would make a nice converted parking garage for the rest of Lincoln Center, supplementing the existing underground one and perhaps extending a subsidy to what is left of high musical culture in New York City.
The sooner it's gone the better in my view. A relic of days gone long by...
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Re: The Met: last season's deficit up, as predicted

Post by lennygoran » Sun Nov 23, 2014 8:46 am

Chalkperson wrote: The sooner it's gone the better in my view. A relic of days gone long by...
Could you explain this--are you now against opera in general, is it just the Met, should the great opera houses in Europe go too-ROH, La Scala, Opéra Bastille. Regards, Len :(

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Re: The Met: last season's deficit up, as predicted

Post by John F » Sun Nov 23, 2014 12:12 pm

Back in the 1960s, Pierre Boulez declared that the world's opera houses should be blown up. Within a decade he was conducting operas in several of them.
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Re: The Met: last season's deficit up, as predicted

Post by jbuck919 » Sun Nov 23, 2014 1:50 pm

John F wrote:Back in the 1960s, Pierre Boulez declared that the world's opera houses should be blown up. Within a decade he was conducting operas in several of them.

Perhaps he meant expanded to a greater size. :mrgreen:

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Re: The Met: last season's deficit up, as predicted

Post by Chalkperson » Sun Nov 23, 2014 3:41 pm

lennygoran wrote:
Chalkperson wrote: The sooner it's gone the better in my view. A relic of days gone long by...
Could you explain this--are you now against opera in general, is it just the Met, should the great opera houses in Europe go too-ROH, La Scala, Opéra Bastille. Regards, Len :(
I don't regard the Met as the same as the European ones, I did in the days of Bing, but that's long gone.

It's the Hall I dislike the most, I remember going to meet Kir Ti Kanawa there to discuss the LP sleeve for South Pacific, I thought the hall was garish and unoperalike. I would have loved to go to the old Met.
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Re: The Met: last season's deficit up, as predicted

Post by John F » Sun Nov 23, 2014 4:20 pm

I went to the old Met a few times, and as you'd expect of a building dating from then and built with robber barons' money and underpaid labor, it was certainly more decorative than the Met - or any other opera house newly built since then. However, the old Met was a terrible place to put on opera. There was nowhere to store the scenery from yesterday's and tomorrow's performances, so the flats etc. were left outdoors leaning against the back of the house covered only by tarpaulins. The stage equipment was antique, limiting the designs that could be put on the stage and making for long scene changes and long evenings. And while the acoustics in some parts of the house were said to be outstanding, I didn't think so where I happened to sit. Rudolf Bing was keen to acquire a new opera house and when the Lincoln Center project was discussed, jumped at the opportunity. So there the new Met is, and there we are.
Last edited by John F on Mon Nov 24, 2014 12:20 am, edited 1 time in total.
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Re: The Met: last season's deficit up, as predicted

Post by lennygoran » Sun Nov 23, 2014 7:42 pm

Chalkperson wrote: I remember going to meet Kir Ti Kanawa there to discuss the LP sleeve for South Pacific, I thought the hall was garish and unoperalike. I would have loved to go to the old Met.
You met her-you lucky devil! :lol: :D I too never got to the old Met. :( Regards, Len

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Re: The Met: last season's deficit up, as predicted

Post by Beckmesser » Mon Nov 24, 2014 10:17 am

Chalkperson wrote:
lennygoran wrote:
Chalkperson wrote: The sooner it's gone the better in my view. A relic of days gone long by...
Could you explain this--are you now against opera in general, is it just the Met, should the great opera houses in Europe go too-ROH, La Scala, Opéra Bastille. Regards, Len :(
I don't regard the Met as the same as the European ones, I did in the days of Bing, but that's long gone.

It's the Hall I dislike the most, I remember going to meet Kir Ti Kanawa there to discuss the LP sleeve for South Pacific, I thought the hall was garish and unoperalike. I would have loved to go to the old Met.
I must agree with Chalkie on this one. As an architect I have to admit that the place makes me cringe. The auditorium reminds me of a gaudy box for St. Valentine's Day candy. Sometimes I find my mind wandering from the opera as I think about how I might have done it differently. On the other hand, the acoustics are quite good for such a large hall so I think it best to leave well enough alone. If I were to make just one change I would remove that ghastly sculpture that hangs over the proscenium.

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Re: The Met: last season's deficit up, as predicted

Post by lennygoran » Mon Nov 24, 2014 10:27 am

Beckmesser wrote: On the other hand, the acoustics are quite good for such a large hall so I think it best to leave well enough alone. If I were to make just one change I would remove that ghastly sculpture that hangs over the proscenium.
Yes we love the acoustics even in our cheaper balcony seats! Regards, Len

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Re: The Met: last season's deficit up, as predicted

Post by Beckmesser » Mon Nov 24, 2014 12:40 pm

lennygoran wrote:
Beckmesser wrote: On the other hand, the acoustics are quite good for such a large hall so I think it best to leave well enough alone. If I were to make just one change I would remove that ghastly sculpture that hangs over the proscenium.
Yes we love the acoustics even in our cheaper balcony seats! Regards, Len
I agree. We almost always sit in the balcony. The sound is better there than in many of the more expensive seats in the orchestra.

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Re: The Met: last season's deficit up, as predicted

Post by Chalkperson » Mon Nov 24, 2014 1:18 pm

lennygoran wrote:
Chalkperson wrote: I remember going to meet Kir Ti Kanawa there to discuss the LP sleeve for South Pacific, I thought the hall was garish and unoperalike. I would have loved to go to the old Met.
You met her-you lucky devil! :lol: :D I too never got to the old Met. :( Regards, Len
I spent quite a bit of time with the lovely Kiri.

I did the sleeve for Bernstein's South Pacific, Kiri was shot here in New York. Jose Crerras was done in London six months later.

I also worked in a documentary about her, I photographed her recording in Abbey Road, rehearsing at the ROH and was filmed chatting to her in her dressing room prior to a performance.

She is a wonderful person, I bumped into her at Paris Airport a few years later and she insisted on giving me a ride to my hotel.

Only Dolly Parton gave off the same sense of utter genuineness, I was lucky to spend a week in a Bemtley touring the U.k with Dolly in the late 70's
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Re: The Met: last season's deficit up, as predicted

Post by jbuck919 » Mon Nov 24, 2014 2:37 pm

The musical education between my father and myself is mutual. Although I owe him everything for my basic musicianship, he never encountered taste until I introduced it to him. One example is this classic performance of the only important movement from the early Mozart Vespers of the Confessor.


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Re: The Met: last season's deficit up, as predicted

Post by lennygoran » Mon Nov 24, 2014 4:34 pm

Chalkperson wrote:
I also worked in a documentary about her, I photographed her recording in Abbey Road, rehearsing at the ROH and was filmed chatting to her in her dressing room prior to a performance.
She is a wonderful person, I bumped into her at Paris Airport a few years later and she insisted on giving me a ride to my hotel.
Only Dolly Parton gave off the same sense of utter genuineness, I was lucky to spend a week in a Bemtley touring the U.k with Dolly in the late 70's
Chalkie what wonderful experiences you have had! Regards, Len

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Re: The Met: last season's deficit up, as predicted

Post by maestrob » Wed Nov 26, 2014 1:33 pm

lennygoran wrote:
Chalkperson wrote:
I also worked in a documentary about her, I photographed her recording in Abbey Road, rehearsing at the ROH and was filmed chatting to her in her dressing room prior to a performance.
She is a wonderful person, I bumped into her at Paris Airport a few years later and she insisted on giving me a ride to my hotel.
Only Dolly Parton gave off the same sense of utter genuineness, I was lucky to spend a week in a Bemtley touring the U.k with Dolly in the late 70's
Chalkie what wonderful experiences you have had! Regards, Len
Yes, I second the motion!

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Re: The Met: last season's deficit up, as predicted

Post by piston » Mon Mar 16, 2015 8:15 am

According to James B. Stewart's extensive report, just published in The New Yorker, that deficit is largely due to a good many big donors giving less, partly because of their perception that Gelb cares more about staging than about music:
In November, the Met released its preliminary results for the fiscal year that ended July 31st: an operating deficit of twenty-two million dollars—a record in absolute terms and, as a percentage of the operating budget, the largest in thirty years. Most of the loss was accounted for by a drop in contributions from major donors.
At the top of the donors' pyramid, Gelb supporters increased their annual contributions but apparently numerous other big donors, such as French Canadian Jacqueline Desmarais (who could solve all the Met's financial troubles in one stroke of the pen; she inherited 4.6 billion dollars following the death of her husband in 2013), are unhappy with his management, particularly his investment in expensive stages as the solution to drawing back Met opera lovers.

The Met's fund-raising strategy, if I understand it correctly, has consisted in building a very large administrative structure of 155 people, many of whom are large donors:
t the top of the board’s pyramid were the eleven members of the executive committee, who include Ann Ziff, the chairman; Mercedes T. Bass, the vice-chairman; Morris, the chairman of the executive committee; and Kevin W. Kennedy, the president and chief executive officer.

There are forty-three voting members, known as managing directors, followed by nine honorary directors, who attend meetings but don’t vote; forty-nine advisory directors; thirty-three members (directors); and twenty-one young associate directors—a hundred and fifty-five people in all.
To alienate a donor such as 87-year old Jacqueline Desmarais, now worth 4.2 billion dollars according to Forbes, well known by George Bush, father, and Nicolas Sarkozy, among other big donors, over the Luc Bondy's production of Tosca, in 2009, is the kind of decision that can make such a fund-raising strategy really backfire. Several of these elderly donors and directors consider themselves the guardians of Met traditions:
Gelb told me that he isn’t interested in novelty for its own sake, and chooses only directors who respect the narrative integrity of a work. But he was soon engulfed in controversy over a new production of “Tosca,” which opened the 2009 season. The updated version brought the Swiss director Luc Bondy to the Met for the first time, replacing Franco Zeffirelli’s sumptuous re-creation of Rome’s Church of Sant’Andrea Della Valle with a dark, stripped-down set in a production that featured prostitutes and simulated sex acts onstage.

The production marked a turning point in Gelb’s relationship with the board, particularly some of its older, long-standing members, who viewed themselves as guardians of Met tradition. Especially offended was James S. Marcus, an honorary director and former chairman. He and his wife, Ellen, had already taken offense when Gelb, at a dinner at the Met’s Grand Tier restaurant, seemed to grow impatient and asked for the check before the Marcuses could order dessert or coffee. Marcus said the new “Tosca” was “barbaric” and told Gelb it was “the worst production I’ve ever seen in my life.” (He subsequently gave ten million dollars to support a vocal program at Juilliard.)

Jacqueline Desmarais, one of the Met’s longtime managing directors and donors, was also upset after seeing “Tosca” and confronted Gelb just before a board meeting. Desmarais is in a position to single-handedly resolve the Met’s financial plight. When her husband, the Canadian financier and conglomerate head Paul Desmarais, Sr., died, in 2013, he left a fortune estimated by Forbes at $4.6 billion.

At a subsequent board meeting, Desmarais raised her hand and asked, “Will I ever see the old Zeffirelli production of ‘Tosca’ in my lifetime?”

“The obvious answer was ‘How soon do you want it?’ ” a board member who was present recalled. Desmarais is eighty-six [she was born in 1927]. But Gelb replied that that was not the way the Met was going artistically. (Gelb does not recall the exchange.) Zeffirelli’s “Tosca” remains mothballed. The controversial Bondy production will be retired after five seasons, and a new version is in the works.


I can see a problem with this strategy when managing, honorary and advisory directors lose faith in the chief administrator and its executive committee: they give less!
http://www.newyorker.com/magazine/2015/ ... id=mod-yml
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Re: The Met: last season's deficit up, as predicted

Post by John F » Mon Mar 16, 2015 9:35 am

I've now read Stewart's piece, and it's mainly an inside story of the Met's board which includes its wealthiest supporters - something that I haven't seen done before, and it's enlightening. There are also some details about the labor negotiations that are new or I missed them at the time. Stewart has gotten more from Gelb's critics on the board and in the unions than from Gelb, but that may be Gelb's fault. Worth reading.

http://www.newyorker.com/magazine/2015/ ... -the-opera

The structure you quote has been in place for decades and has succeeded in getting an extraordinary amount of donations season after season. The Met also has a large "development" department whose mission is to keep the current patrons happy and solicit new ones. There's nothing wrong with the structure, as far as I can see. But if a substantial number of major donors are indeed reducing their contributions, for whatever reason, that makes the fundraising job all the harder.
piston wrote:big donors...are unhappy with [Peter Gelb's] management, particularly his investment in expensive stages as the solution to drawing back Met opera lovers.
I don't quite understand "expensive stages," unless it refers to the Machine in the current Ring cycle. If it means stage productions, a consistent trend has been to replace expensive productions (Zeffirelli et all) with cheaper new ones, cheaper to build, use, and maintain. But perhaps it refers to the number of new stage productions per season, which Gelb increased from 3-4 to seven (since reduced to six). These are certainly more expensive than revivals, not just because building sets and costumes is more expensive than maintaining them but because of the extra rehearsal time that the director and performers have to be paid for. Could you clarify?

What bothers some of the big money patrons, and not just them, isn't the cost but the character of some of the new productions, "Tosca" being a particularly sore point. Stewart says that Gelb is more excited about new productions than any other aspect of his job, and that he favors radically different ones. I don't know how true this is; when he took the job he seemed to be saying otherwise, and his new productions have been a mix of traditional and somewhat innovative, stopping far short of the wild excesses of Eurotrash. But maybe so.
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Re: The Met: last season's deficit up, as predicted

Post by lennygoran » Tue Mar 17, 2015 2:33 am

piston wrote:
To alienate a donor such as 87-year old Jacqueline Desmarais, now worth 4.2 billion dollars according to Forbes, well known by George Bush, father, and Nicolas Sarkozy, among other big donors, over the Luc Bondy's production of Tosca, in 2009, is the kind of decision that can make such a fund-raising strategy really backfire. Several of these elderly donors and directors consider themselves the guardians of Met traditions:
Gelb told me that he isn’t interested in novelty for its own sake, and chooses only directors who respect the narrative integrity of a work. But he was soon engulfed in controversy over a new production of “Tosca,” which opened the 2009 season. The updated version brought the Swiss director Luc Bondy to the Met for the first time, replacing Franco Zeffirelli’s sumptuous re-creation of Rome’s Church of Sant’Andrea Della Valle with a dark, stripped-down set in a production that featured prostitutes and simulated sex acts onstage.

The production marked a turning point in Gelb’s relationship with the board, particularly some of its older, long-standing members, who viewed themselves as guardians of Met tradition. Especially offended was James S. Marcus, an honorary director and former chairman. He and his wife, Ellen, had already taken offense when Gelb, at a dinner at the Met’s Grand Tier restaurant, seemed to grow impatient and asked for the check before the Marcuses could order dessert or coffee. Marcus said the new “Tosca” was “barbaric” and told Gelb it was “the worst production I’ve ever seen in my life.” (He subsequently gave ten million dollars to support a vocal program at Juilliard.)

Jacqueline Desmarais, one of the Met’s longtime managing directors and donors, was also upset after seeing “Tosca” and confronted Gelb just before a board meeting. Desmarais is in a position to single-handedly resolve the Met’s financial plight. When her husband, the Canadian financier and conglomerate head Paul Desmarais, Sr., died, in 2013, he left a fortune estimated by Forbes at $4.6 billion.
Thanks so much for this-I got a chance to live vicariously-if only I had the money of that donor Jacqueline Desmarais and was with him at the dinner table-he would have heard from me for sure-I sure didn't think too much of that dark disrespectful Tosca! Regards, Len :x

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