State of State of the Symphony
In the mail the other day I received a small flyer from the PSO entitled "State of the Symphony: Why Your Support Matters." It includes a letter from President & CEO James A. Wilkinson, printed on urgent white-on-red, pie charts cleverly overlaid on drum heads that break down the expenses and revenue into five or six categories, and a panel entitled "At a Glance: The PSO's Financial Picture."
A standing ovation to Mr. Wilkinson's openness! His effort to report "how we are funded; why we have been weathering a deficit; what we are doing to eliminate the deficit; and why your support is critically important" is very welcome and necessary. I know several well-meaning patrons of the arts who regard such openness as being in bad taste: Of course the institution needs your money, they say--just give and don't grovel by explaining where the donations are going and why they're needed.
I disagree with this closed-door attitude. I suspect the general public sees a small army of culturally sophisticated professionals in tuxedos and figures there is money to burn in the organization. They are surrounded by Heinz Hall's glitz, in the heart of Downtown's Cultural District, and are world-famous--why would they need my help? Furthermore, audiences and donors have long been disillusioned by corrupt leaders, who, Enron-like, pick grandma's pocket in order to pay for the second Maserati. Nationwide, executive compensation has skyrocketed while the worker bees have suffered from systemic colony collapse disorder, especially since the 2008 recession.
The openness in the State of the Symphony brochure is therefore a relief, a refreshment, a sign of good leadership. Why should, then, we give to the PSO? Many of the worker bees in the PSO are very handsomely paid, with musician salaries never lower than $90,000, I'm guessing, and many of the musicians being paid twice that. Could these high base salaries for the musicians have anything to do with the PSO's financial challenges, or is the management pocketing more than its share?
It's hard to get answers from this State of the Symphony brochure--and that's the problem. The brochure feels like an honest effort to engage Pittsburghers with some cold facts about the PSO's aim to earn $17 million by balancing its budget for three years straight. But the "report" reads more like a memo than a treasurer's report. I'd like to look at a few numbers that raise flags.
First, is it possible that 25% of the operating budget came from drawing on the endowment? This number sounds absurdly high to me--how is that sustainable? Yet there is no explanation, no clarification in the roughly 350-word "report." Second, ticket sales (not just subscriptions) account for only 36% of revenue, also a troubling figure that is too low by double digits. If only tickets could be found wherever PA Lottery tickets are sold! Finally, expenses are said to go 51% to the orchestra (most of that in salaries, no doubt) and 16% to the administration. Let's do some math. The PSO website lists six people under "Administration" in its staff listing, along with two full-time and sixteen part-time phone reps (roughly the equivalent of eight full-timers). There are six sales specialists, six patron services employees, nine in finance, three engineers, four in education and community involvement, six in artistic planning, and three archivists. The remaining employers seem to belong to categories other than "Administration," such as Heinz Hall people or development officers. That's a total of 53 people--quite an outfit behind the scenes! The musicians, by contrast, number about 95, including the four conductors. That's 51% of expenses going to 95 musicians (over half a percent per musician) and 16% going to 53 administrators (under a third of a percent per administator).
Most of the administration probably receives quite modest salaries, probably half of what the lowest-paid musicians earn. This suggests that a handful of administrators are quite handsomely paid--easily as much as some of the most valuable musicians in the orchestra. In this way, the PSO appears to reflect the income inequality present in for-profits and non-profits across the country--and we know that's a problem in so many ways. The PSO members have already taken a pay cut in recent years; it will be interesting to see what further steps the organization takes to minimize expenses and maximize income. My hope is that local businesses will step boldly into the mix and, without re-branding the orchestra into the Giant Eagle Band or the Alcoa Orchestra ("PNC Pops" is a far cry from the "Boston Pops"). I hope will give to the symphony as never before, since we're all in this together.
My numbers may be significantly off the mark and my reasoning may be simplistic--but that's what happens when all you can see is an "at a glance" budget. I applaud this State of the Symphony flyer, but hope to see it represent a more detailed portrait of the PSO's finances next year.
