Leading cultural institutions feel impact of recession
Albright-Knox, orchestra announce cuts
The deepening recession has grabbed hold of Buffalo’s two cultural pillars, forcing them to take drastic action to make up for losses in revenue and shortfalls projected for next year.
The Albright-Knox Art Gallery will close for a week, beginning May 18, and furlough its staff without pay, while the Buffalo Philharmonic Orchestra will take stringent steps, including layoffs and salary cuts for administrators, to contain financial losses and ensure long-term sustainability.
“We now face the possibility of a significant operating deficit this year and perhaps for several years to come,” Cheryl Howe, chairwoman of the orchestra’s board; JoAnn Falletta, the music director; and Daniel Hart, executive director, warned in a letter to donors and patrons.
“The current economic climate has created a funding situation that has forced us to make some very difficult decisions,” said Louis Grachos, gallery director.
Both organizations have encountered steep drop-offs in charitable giving as hesitant donors struggle with their own financial uncertainties from the shaky economy.
At the Albright-Knox, other cost-saving measures include:
• Continuing a hiring moratorium that, since August, has prevented permanently filling the public relations director’s position.
• Halting travel reserved for fundraising.
• Eliminating extended hours on Thursday evenings.
• Reducing programming on free Fridays.
• Reducing the number of major exhibitions in next year’s gallery budget.
In January, the museum raised admission prices to $12 from $10. It also established a corporate partnership program to boost support from businesses.
At the orchestra, staff positions and salary cuts began April 1. Among other steps to save costs:
• Both Falletta and Hart took 10 percent salary decreases and have pledged $50,000 apiece to help shore up orchestra finances.
• The staff was slashed to 21 from 28 full-time members, while the number of part-time positions will go to nine from five as of Friday.
• Overall administrative wages and benefits were reduced 12 percent, with senior staff members taking a voluntary 5 percent pay cut.
• Beginning Friday, the staff will pay into the orchestra’s health insurance plan, resulting in projected savings of 12 percent to 15 percent.
• Some concert programs have been revised to require fewer extra players. The guest artist budget, music rentals and department budgets also have been scaled back, and a contract with an outside telemarketer was terminated.
Like other cultural groups across the country, the two local arts organizations are contending with the erosion of their secure financial footings of recent years.
At the Albright-Knox, the declines consist of 24 percent in revenues, 21 percent in the operations endowment and, not surprisingly, 20 percent in charitable giving.
“[The economy’s effect] is really unfortunate, because our museum seemed to get some really good footing over the past two years in terms of charitable giving, and balancing our budget,” Grachos said.
The orchestra’s endowment funds have dropped 20 percent since September, with ticket sales off 7 percent, forcing a $600,000 reduction from this season’s $10 million-plus budget. Charitable donations also have taken a big hit.
The reversal follows four years of balanced budgets, dramatic growth in attendance for orchestra youth concerts, increased ticket sales and unprecedented artistic recognition for the orchestra, including two recent Grammy awards.
The long-term prospects looked particularly rosy Dec. 31, when the orchestra’s three-year Secure the Future endowment drive surpassed the $30 million goal, bringing in $32.1 million in cash and pledges.
But even then, the recession was casting a shadow over Kleinhans Music Hall. Ticket sales were dropping sharply, government funding continued a downward spiral, fewer schools scheduled youth concerts, and corporate and foundation support softened.
“We knew from the beginning that this was going to be a tough year, but not as tough as it turned out,” Hart said.
Musician salaries and benefits have not been affected so far.
Falletta is reworking programs to save money without compromising performance, and a special one-week ticket sale brought in $3,000, demonstrating that despite “great price sensitivity” in the market, “there is also great demand for our product,” Hart said.
The Albright-Knox’s Grachos also is optimistic. Attendance for “Action Abstraction,” its highly praised, current exhibition, has met targets, and the show has been a success, he said.
“We’re very optimistic things will eventually get back on track. We just hope the community will be patient,” he said.
msommer@buffnews.com and tbuckham@buffnews.com
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