The Buffalo Philharmonic Orchestra is ending the year on high and low notes.

The high is yet another Grammy nomination — this time in the best-engineered classical album category for “Respighi: Church Windows, Brazilian Impressions, Rossiniana.” The performance on the Naxos label was conducted by Music Director JoAnn Falletta and engineered by John Newton.

Also up for the engineering Grammy: the Los Angeles Philharmonic, Atlanta Symphony and Chicago Symphony.

On the downside, the orchestra recorded a $535,000 operating loss in the fiscal year that ended Aug. 31, even after lopping $1 million in expenses — $800,000 in staff and orchestra costs and $200,000 in non-orchestra outlays.

Those measures involved pay cuts for several leaders, including Falletta and Dan Hart, the orchestra’s executive director, and the elimination of seven administrative posts. Expenses still increased 1.4 percent.

Total revenue declined 4.4 percent, and concert revenue fell 10.4 percent, to $3.4 million.

Hart and Jeff Wellington, the orchestra’s treasurer, noted that other U. S. orchestras have been similarly affected by the recession. The financial news, however, was not all bad. The Philharmonic reported a 3.2 percent increase in contributed income “primarily due to large gifts from generous donors to reduce deficit,” and a $146,000 gain in endowment income to $869,000. Endowment assets rose $3.4 million, to $22 million.

Another encouraging note: The Secure the Future campaign, designed to ensure the orchestra’s long-range stability, raised $32 million in pledges.

In addition, the orchestra’s short-and long-term debt dropped $176,000, to $952,000.