Minnesota AFL-CIO: "MN Orchestra should come clean about budget situation & state money requests."
Minnesota AFL-CIO President Shar Knutson is calling on the Minnesota Orchestra to be honest about its budget situation if it plans to continue requesting state money. Knutson's message comes in light of a Minneapolis Star Tribune report showing how the orchestra's governing board arranged finances in order to achieve favorable outcomes in state bonding requests & labor negotiations. The orchestra received state financing for a construction project & has now locked out its union musicians. According to the report:
As early as 2009, board officers were discussing how much money to draw from investments, and the advantage of reporting balanced budgets at a time when the orchestra was raising funds and seeking state money.
"Balances in 2009 and 2010 would support our state bonding aspirations," Bryan Ebensteiner, vice president of finance, told the orchestra's executive committee in September 2009, "while the deficits in 2011 and 2012 would demonstrate the need to reset the business model." His comments are included in minutes of the finance and executive committees obtained by the Star Tribune.
The board chose to cover operating deficits in 2009 and 2010 with major withdrawals from its investments. Then, in 2011 -- on the cusp of labor negotiations with musicians -- it "drew down" less money and declared a $2.9 million deficit.
"Minnesotans should expect honesty & integrity from the public & non-profit entities that request state dollars," Knutson said. "The Minnesota Orchestra's leadership needs to end this lockout, get back to the negotiating table, & be honest about their financial situation."
Knutson stressed that if the orchestra continues to be murky with its financial situation, state action might be called for.
"If the Minnesota Orchestra's leadership refuses to be forthright about their finances, we will urge Legislators to look into the situation in January."