‘Possible Misrepresentations’? YES!
By Carol Jean Delmar (Okay, Carie J.)
I have searched in my heart to find any misrepresentations in the opinion piece I wrote for the Huffington Post that could have warranted banning me from the Web site. And then at 3 a.m. on Feb. 14, it hit me: I was far too kind. I will therefore proceed to enlighten the public about the bleak financial problems facing Los Angeles Opera. But please note that this is only my opinion. I do not profess to know what’s happening behind the scenes. I haven’t seen financial statements or tax returns, and even if I had, I’d probably need the expertise of my accountant to analyze them. But as I was dozing off with a cup of hot tea in my hand, I started to see everything so much more clearly.
As I explained in my Huffington Post article, Edgar Baitzel was in charge of LA Opera’s day-to-day operations until his death in March 2007. The company announced its Achim Freyer “Der Ring des Nibelungen” at a press conference on Sept. 28, 2006, stating that Eli Broad had contributed $6 million, with additional donations from the company’s chief executive officer, Marc Stern; its president, Carol Henry; and other board members. Then Plácido Domingo, the Eli and Edythe Broad general director, stated: “Not only does it mean that the company has the financial means for such a mammoth undertaking, but it is also a sign of the artistic vision of its management team.” Hmmmmm.
LA Opera began presenting each of the four operas in Wagner’s “Ring” individually beginning in February 2009. Three of them have already been performed. The final one, “Götterdämmerung,” is set for April, and then three complete “Ring” cycles will be presented from May 29 to June 26. The 100-event Ring Festival LA will cloak the productions from April 15 to June 30. The price tag is $32 million.
When Los Angeles County Supervisor Michael D. Antonovich proposed balancing the festival with composers other than Wagner — since Wagner was an anti-Semite whose music is associated with the Holocaust — his proposal was defeated by Supervisor Zev Yaroslavsky’s substitute motion to endorse and publicize the festival. I do not recall that any of the supervisors inquired as to the fiscal stability of LA Opera at that time, and the opera company didn’t offer any information, which would have been pertinent.
Then in December 2009, LA Opera came running back to the Board of Supervisors for a $14 million loan. Once again, LA Opera did not expose its financial instability to the board beforehand. Per my Huffington Post article: “The supervisors were put in a precarious position. If they allowed LA Opera to fail, they would no longer have an occupant to lease the Dorothy Chandler Pavilion since the county owns the Music Center. So they granted LA Opera the $14 million loan by issuing bonds that were purchased by Banc of America Leasing & Capital LLC. LA Opera has three years to pay the loan back with interest going to the bank, but if the company does not raise the funds, county taxpayers will foot the bill.” Antonovich was the sole dissenting vote, as well he should have been.
According to Yaroslavsky’s LA County Web site, Stephen D. Rountree, president of the Music Center and LA Opera’s chief operating officer, said: “[LA Opera] had their operations in order until the recession hit. Ticket sales are down across the country.”
Yet Opera News Online reported on Dec. 9 : “LA Opera chief operating officer Stephen D. Rountree . . . told the county’s board of supervisors that the loan ‘is needed now’ . . . and that twenty-three LA Opera trustees had pledged $30 million over the next two-and-a-half years to stabilize the company’s finances after what was characterized as years of overspending.” Hmmm – that sounds like quite a different story.
An article in the Los Angeles Times written by Kelsey Ramos (Dec. 9 on the Internet) stated that Rountree said, “The company is $20 million in debt, partially because of the undertaking of its ‘Ring’ festival.”
And Opera News stated that the Los Angeles Times quoted Rountree as having said that LA Opera’s artistic administration did not “fully appreciate that they needed to put out $20 million of the $32 million for the ‘Ring’ cycle two years in advance.”
The debt began accumulating as LA Opera board members made interest-free loans of $10.9 million during the 2006-07 season and $19.6 million during the 2007-08 season along with an $11 million line of credit from the Bank of the West at 5 percent interest, reported the LA Times and Opera News. During the 2007-08 season, ticket sales totaled $18.2 million when the budget was $55.6 million, but donations of $40.7 million filled the gap. In the 2006-07 season when Domingo stated that the company had the financial means to move forward with the “Ring,” the Times reported (Dec. 8 ) that the deficit was nearly $6 million.
The statistics tell me that LA Opera was in no position to undertake a $32 million “Ring” even before the recession. The Board of Supervisors was kept in the dark far too long. I will never forget when Yaroslavsky told the board in July that the politicians should keep their “sticky fingers” out of LA Opera’s art. Frankly, I think their sticky fingers would have been quite helpful.
I still stand by what I wrote in my Huffington Post article: “LA County should not have been asked to bail out a nonprofit arts organization that had financial problems well before the recession. In essence, LA County is paying for half of the ‘Ring.’”
Someone much more powerful and prestigious than I am might have told the Huffington Post that I stated a “misrepresentaton” since Opera Now reported on Dec. 17 that Rountree said the loan would “only be used to cover the company’s debts, and will not be spent on day-to-day operations or the ‘Ring’ cycle production.” According to the information I’ve outlined above, that statement might be a misrepresentation since much of the debt has indeed resulted from the “Ring” production.
The upcoming 2010-11 season has been vastly trimmed from 10 productions a few years ago to six, and from 75 performances to 42. Staff members have been laid off. There is a 50 percent reduction in production expenses from previous years and a 30 percent decrease in administrative and operating costs.
But the powers that be in Los Angeles – the LA Opera board, donors, city and county leaders, religious leaders and various press organizations – aspire to make LA Opera the second most prominent company in the nation. They wanted this “Ring” to be produced even if they had to misrepresent themselves. It’s about their egos, not about doing what is right or fiscally responsible. Those powers tried to silence me even though my article wasn’t biased and didn’t protest the “Ring” festival. I would have been happy to write opera reviews for the Huffington Post. I had no plans to protest Ring Festival LA anymore, although I knew I could never accept it. But I simply cannot be silent now when some very ugly people have tried to hurt someone who is not.
Here you have a company that planned to produce an expensive, controversial “Ring” and found that the pledges were not materializing.
LA Opera probably has a general fund. Much of that money was probably used to pay for “Ring” expenses. One could say that if the “Ring” had been canceled, the company would have been in fine shape. But many of the donors contributed specifically for the “Ring.” The “Friends of the Ring” was established for that purpose. Most of that earmarked money has been spent already. It could never have been refunded to the donors, and even if the money hadn’t been utilized, it could have never been moved to the general fund to bail LA Opera out. Add to that the fact that Eli Broad was “exacting demands on how the millions he has donated are spent” (New York Times, Feb. 7), and you realize that the board must have felt compelled to proceed with the “Ring” under any circumstances. I have read that Broad aspires to make Los Angeles a cultural Mecca. The Wagner “Ring” festival is unfortunately the vehicle being utilized to reach that end. Some of the “Ring” donors might have bailed the company out, but they’d already contributed to the “Ring.” So in December, LA Opera wasn’t in good shape generally or “Ring”-wise. And having no “Ring” would have still left the company fiscally unstable.
I personally believe LA Opera should have postponed the “Ring” until next season and maybe only planned for “Il Postino” and a few recitals. Such a hiatus would have enabled LA Opera to raise funds and still honor the Dorothy Chandler Pavilion lease.
But Los Angeles politics has created a situation where politicians and other groups are beholden to the rich and powerful so that fiscal responsibility and morality are taking a back seat. I guess I was in the way and easy to dispense with which doesn’t say much for those who caved in under the pressure or for those who were doing the pressuring.
Rountree was quoted in Opera News as having said: “The opera was being very ambitious artistically, pushing the edges. It might have worked fine, except for the crash in the economy.”
That was irresponsible of LA Opera – to bank on loans and credit to stay afloat even before the recession.
Yes, LA Opera did push too far artistically. Ticket buyers are not buying this “Ring.” The company pushed too far financially when it didn’t have the means; and it pushed too far morally by honoring a racist in an all-encompassing 100-event city-county arts festival.
To date, LA Opera’s “Extraordinary Giving Campaign” has received more than $30 million in pledges with more than $4 million in payments.
Nobody really knows what the final outcome will be. I believe that a total reorganization of the company might be in order. One thing is certain, though – even if LA Opera does survive, its worldwide image has been tarnished. And THAT is my opinion.
