By Chris Lane
By Jeff Balke
By Aaron Reiss
By Angelica Leicht
By Dianna Wray
By Aaron Reiss
By Camilo Smith
By Craig Malisow
Unlike other arts organizations, the Houston Symphony's financial problems seem endemic to the organization itself rather than a symptom of the economic climate. Since 1971, the society has run deficits every year except one. In 1976, the accumulated deficit had reached $1.4 million, and 29 concerts were canceled after a new musicians' contract could not be agreed upon. Ten years later, during the mid-'80s oil bust, musicians' wages were cut by 15 percent and positions were left vacant.
Under Eschenbach's tenure, the gloomy days seemed to be over. The successful 1992 European tour pushed ticket sales back home to record highs. And in the spring of 1993 the organization surpassed its $40 million capital campaign fund goal. The symphony was awarded large grants from the Cullen and M.D. Anderson foundations, and it added almost $27 million to its endowment.
But by the 1995-96 season, the organization was again posting a deficit of $1.1 million, even though revenue from the endowment was growing along with the stock market. The administration argued that projected income simply didn't meet spending needs.
In an attempt to right the boat, the symphony board's executive committee brought in the Dini Partners, a philanthropy and nonprofit management company to assist in planning for a $37.5 million capital campaign.
After interviewing individuals, corporations and foundations considered critical to the campaign's success, the Dini Partners issued a final report. "While the last seven years have witnessed a remarkable advancement in the artistic quality of the Symphony," it read, "this transformation has not been accompanied by a corresponding improvement in the quality of the Symphony's administrative and support systems." The partners blamed a "history of labor discord" for making it difficult for the organization to work together as a healthy fund-raising team. In addition, the report argued that board membership was not sufficiently diverse, nor representative of Houston's philanthropic community.
The situation was growing only more tenuous. The estimated deficit for the 1996-97 season was $1.7 million. The society also acknowledged a bank debt of $7.1 million. By summer, the society had cut salaries by almost 8 percent, and in an interview with Chicago magazine, a frustrated Eschenbach said, "To be number one, like Berlin, Vienna or Chicago, [an orchestra] needs financial involvement If the folks in Houston don't want that, I'm ready to leave." (Eschenbach's agent turned down requests for an interview with the former conductor, as did his successor, Hans Graf.)
The society launched a $25 million capital campaign, but it never got the size of gifts it needed and so was quietly put to sleep.
"It started out as a debt reduction campaign -- not the most sexy lure for donors," explains one former development department staffer, who asked not to be identified.
In an attempt to pull the symphony into the black, the Houston Endowment and the Wortham Foundation ponied up enormous grants that combined to make a $7.3 million gift to the campaign, effectively bailing out the society. But despite a clean slate and the go-go '90s stock market that led other arts organizations to flourish (the Museum of Fine Arts' five-year capital campaign generated $127 million for the new Audrey Jones Beck Building), the symphony entered the new century -- almost unbelievably -- in the red again. The projected deficit for the upcoming fiscal year is $2.3 million.
But the symphony would be wise not to expect another bailout. "We will continue to support the symphony," says the Houston Endowment's Joe Nelson, choosing his words carefully. "[But] I think it would be a much more difficult decision today for the board, given our experience, to agree to something like that again."
Why has the symphony so often operated in the red? In an e-mail to the Houston Press, executive director Ann Kennedy says, "The main traditional deficit has been the lack of a sufficiently large endowment."
But musicians question why the 150-member board of trustees has not done more to increase fund-raising, and why they didn't take more advantage of the financial boom of the late '90s. Some speculate that the trouble stems from the board's assumption that Houston doesn't need more than a nice regional symphony. "When we did strategic planning in the '80s and '90s," says Kevin Kelly, a violin player with the orchestra since 1977, "we had to fight the board, who thought Houston couldn't afford an international-class symphony."
Echoing the Dini Partners' report about board diversity, musicians and supporters believe the board is operated by a tight-knit cadre of wealthy, longtime Houstonians who are not forward-thinking in terms of the symphony. Some musicians say the tradition of Monday-evening concerts, for instance, which few symphonies still schedule, is a holdover from decades ago, when Monday was considered the board members' night to see and be seen after weekends away.
In one telling anecdote, when the board balked at funding the symphony's European tour in 1997, Christoph Eschenbach became furious, and a board member had to be called off the golf course to attend an emergency meeting.
"There are a lot of decisions about the Houston Symphony that get made at the River Oaks Country Club," says Kirk.
One current board member, who asked not to be identified, says the musicians may not be entirely off the mark. She calls the lack of diversity on the board and the lack of energy in recruiting new members "one of the largest problems with the symphony."