[This blog post was already overdue and about 1/3 written when the Salonen announcement landed, and that's been distracting me for the last 10 days or so.]
A six-opera season feels like some kind bellwether, and not a good one, for the company. It's been at eight operas for a number of years, and that was a reduction from ten, and that was a reduction from twelve or thirteen back in the 1980s. Six operas feels like a huge reduction in ambition and scope, because it's a 25% reduction over the last many seasons. (With the archive still offline, I can't easily check when the reduction from 10 to 8 happened.)
I find the reduction especially sad coming after the centennial season and the 101st season, where the company produced five new operas out of sixteen, drew in new audiences (particularly with Omar and Frida y Diego), and had some great concerts as well. The upcoming season does include two one-off concerts and Opera in the Park, but the two concerts absolutely don't make up for losing two operas. Beethoven's 9th will take much less rehearsal time than an opera requires and there's no staging or scenery involved, no juggle of schedules and locations and coaching and the orchestra.
I chatted with Matthew Shilvock before the season announcement and asked what was going on. I should have been more precise in my questions; what I heard about the length of the season wasn't specific to SFO's financial situation. He provided general information about music org finances; the reduction over decades in the percentage of income from ticket sales, issues in the financial model; and so on.
The reduction seems strange to me because the company is in good financial condition, as far as can be told from their 990 forms. It is true that on the most recent 990, the size of the endowment is down from its peak, but it's also considerably higher than it was before the pandemic. And from watching my own 401Ks, I would bet that the SFO endowment has gone up from the period covered by the most recent. 990, which was filed last summer. I mean, do I get better investment advice than SFO? I doubt it.
Here are some numbers from the last three 990 forms:
FY Ending July 2020 (filed 2021)
Revenue
$88,254,131
Expenses
$70,437,595
Net Income
$17,816,536
Net Assets
$269,322,430
Endowment: $244.7 million
FY Ending July 2021 (filed 2022)
Revenue
$79,158,489
Expenses
$52,174,556
Net Income
$26,983,933
Net Assets
$340,907,354
Endowment $312 million
FY Ending July 2022 (filed 2023)
Revenue
$88,376,102
Expenses
$68,630,368
Net Income
$19,745,734
Net Assets
$314,499,971
Endowment $281.2 million
This is not the picture of a company on the brink. As I noted, it's likely that the next 990 - look for it in maybe August - will show the endowment and net assets back up. But the endowment is still tens of millions up from where it had been, even in the most recent 990.
I asked about the cutback, and, as noted, Shilvock's comments did not get very specific about the company's finances. I believe that when an organization that appears to be in perfectly good financial health makes these kinds of cuts, it should show its work. That is, provide as much detail as possible about the finances and the reasoning behind the cuts.
Shilvock did mention long-term trends in the arts in the United States. Only 16% of revenue comes from ticket sales, down from 60% in the 1960s. That means gigantic fundraising efforts are necessary (he didn't say this, but clearly it's part of what goes on, so if you're wondering why orchestras and opera companies have big development departments....). I was somewhat alarmed by his comment that "something fundamental needs to change about how the American arts work." There is no reason to expect an increase in government funding, given that one of the major parties looks on the arts with more than suspicion. And given how Arts Council England is gutting the English National Opera and other arts organizations in the UK, we need to keep that risk in mind as well. What the government gives, they can take away.
SFO is starting to have some success. Of the people who are clearly big donors, which we know because they are season or production sponsors, I call to your attention Dr. and Mrs. William Coughran. Bill Coughran was an important, high-ranking VP or SVP at Google for many years. It's great to see his name associated with SFO. Will more tech folks follow? I can't say, obviously. Of the younger generation, it's common to see donations to health care research and organizations: Sergey Brin and Parkinson's; Mark Benioff and children's hospitals; Mark Zuckerberg & Priscilla Chan, SF General.
So I worry about "something fundamental needs to change about how the American arts work." Does that mean breaking unions to reduce performer pay? That would be a disastrous turn of events, a huge step backward for large opera companies and symphony orchestras. (I point here to events across Grove St., where SFS management has bungled things so badly that they made major artistic cuts and now they're losing their music director.)
All that said, Shilvock is excited about the future. He said that it's "a transitional moment for the art form, making sure that the financial model will sustain the company. It’s important to reconcile the financial model but we have to also sustain the artistic goals." He mentioned these four points:
- The company must keep producing "transporting emotional experiences" and remember "the power of the art form to create all-consuming experiences." They have to maintain the level of artistry.
- They must keep building repertory with new works and productions, connecting to the deeper arc of humanity, and connection to communities.
- They must sustain creative excellence and the caliber of the arts in SF.
- They must keep pushing boundaries. "We can’t retreat, we must keep things moving forward. We have initiatives like the encounters, out of the box, livestreams."











