Minnesota Orchestra Offers Fourth Contract Proposal to Musicians' Union
Contract results in $3.6 million deficit over three years, despite revenue increases
Under the terms of the three-year proposal, the Minnesota Orchestra would accrue a deficit of $3.6 million over three years, due to the salary costs in the contract. "Our aim was to eliminate our $6 million annual deficit entirely. We have moved our position considerably in hope of getting musicians back on the stage and audiences back in Orchestra Hall in October," said Board Chair Jon Campbell.
The Board's original proposal was an important element in the plan to eliminate the organization's annual $6 million deficit entirely. It called for a 32 percent salary reduction, leading to an average annual musician salary of $89,000 and minimum salary of $78,000. However, cuts to expenses-including the proposed reduction in musicians' salaries, the earlier layoff of 20 percent of all administrative staff, and salary and benefit reductions for all remaining staff-are only part of the plan to eliminate the deficit.
Campbell explained, "It's important to remember that our business plan requires us to bring in $2.1 million in new net revenue each year, starting with Fiscal 2014, through increased donations and earned income. But even with a revenue-generating plan this vigorous, we will still experience a new cumulative deficit of $3.6 million over the three-year life of the proposed contract."
He continued, "It should be clear from this commitment that we are confident about this organization's future and willing to do everything we can to generate new funding for the Orchestra. With dramatic cuts already undertaken in every other area of the operation, and commitments to aggressive revenue increases for future years, all we need is for the musicians to partner with us and agree on a resolution. Our negotiating committee is ready to have further discussions at any point in the next four days."
Contract talks between the Minnesota Orchestral Association and its musicians, who are members of the Twin Cities Musicians' Union (Local 30-73), began on April 12, 2012, during which time the Orchestral Association has issued four different contract proposals. Musicians have not responded with a contract counterproposal. In December, the Orchestral Association made public its annual independent audit, conducted by CliftonLarsonAllen, which revealed an operating deficit of $6 million for Fiscal 2012. In June, a special review by the State's Legislative Auditor confirmed that the Orchestra has used all state funding appropriately.
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