Philadelphia Orchestra files for bankruptcy protection

The world-renowned Philadelphia Orchestra, long considered one of the best in the U.S., will be filing for Chapter 11 bankruptcy protection.

'We're running low on cash, we're running a deficit'

The world-renowned Philadelphia Orchestra, long considered one of the best in the U.S.,  will be filing for Chapter 11 bankruptcy protection.

Board chairman Richard Worley said members made a nearly unanimous vote Saturday to file for reorganization in a federal bankruptcy court in Philadelphia after a "long meeting, thoughtful meeting, emotional meeting."

"We're running low on cash, we're running a deficit, and we have to put ourselves in a position to attract investment funds to help us," Worley told reporters.

Allison Vulgamore, president and chief executive officer, also cited a "tremendous decline" in audiences over the past five years.

Officials stressed, however, that concerts would go on as scheduled, including the evening's performance of a Mahler symphony. And they said a revitalization campaign was planned to increase revenues by about two-thirds and bring in new art and audiences.

The economic woes in the U.S. have taken a toll on nonprofit arts organizations, and smaller orchestras in cities such as Syracuse, N.Y., and Honolulu have filed for bankruptcy in recent years. But Philadelphia's is the first major metropolitan orchestra to do so, said John Bence, spokesman for the League of American Orchestras, citing records his organization has kept dating as far back as1986.

Philadelphia Orchestra musicians who object to a bankruptcy filing distributed leaflets to the audience before Thursday night's concert, calling such an action "unnecessary" and saying it would have "both an immediate and a long-term devastating impact" on the orchestra. Union officials and others have cited the orchestra's $140 million US endowment, but Vulgamore said use of that money was restricted.

"Thank heavens it's there, it's the future we have to live off of," she said. "If we take that money now, then we frankly don't have annual monies to keep going."

Seeking 16 per cent pay cut

Musicians, who in recent years have agreed to take pay cuts totalling millions of dollars, have expressed concern about the effect of bankruptcy on their pensions. Worley said that would be worked out in negotiations, but officials want orchestra members to have a "reasonable and respectable pension."

The orchestra's management is seeking a 16 per cent pay cut and other concessions from the musicians as part of ongoing contract negotiations. Players say there have been no talks since March 27 and none are scheduled.

The Philadelphia Orchestra has traditionally been considered one of the best in the country along with the orchestras in New York, Chicago, Boston and Cleveland.

Vulgamore notes the situation was not unique even in the orchestra's long history, citing "Save the Symphony" campaigns from early in the 20th century.

"We've been through this before, we've been through two world wars and a depression," Vulgamore said. "We're going to need to pull ourselves through this bankruptcy with pride and will to remain the Philadelphia Orchestra."