November 23, 2010

@jackhoogendyk~ Taxpayers to "bail out" the Detroit Symphony Orchestra?-Core Principles


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Is it Time for Taxpayers to Bail Out the DSO?

As reported in the Wall Street Journal:


"On StrikeThe Detroit Symphony Orchestra's 85 musicians walked off the job in late September after negotiations broke down over a proposed contract calling for the salaries of veteran musicians to be cut by nearly a third while new players would start at 42% below the current base of $104,650. Pension and health benefits also would be cut.


The players had offered an initial cut to $82,000, but wanted pay partially restored over three years, to $96,600.


The orchestra's management contends the cuts are needed as the DSO faces a $9 million loss this year in its budget, after two seasons in which it had deficits totaling more than $10 million. The orchestra has also said it faces rising interest payments on more than $50 million in bank loans. Revenue shortfall has been unusually severe as the auto industry has shrunk, spurring a drop in ticket subscriptions and decline in donations."


What is the answer? Taxpayers to the rescue! As reported in Gongwer:


"The House is expected to take quick action on a local tax financing package for the Detroit Institute of Arts and Detroit Zoo when it returns from break, but there is talk the chamber could add a third beneficiary: the Detroit Symphony Orchestra.

The Senate surprised many when it moved fast on SB 1578 and SB 1579, after previously declining to act on anything close to a tax increase, but the bills are being fast-tracked through the Legislature in general because of the shortened lame-duck session. The House skipped its usual referral of the bills to committee and just put them on second reading.


symphony strikeThe legislation allows voters in Wayne, Oakland and Macomb counties to create a new property tax to fund the DIA while increasing the existing levy for the zoo.

But unlike the DIA and zoo, which are owned by the city of Detroit but are run by independent nonprofits, the DSO is an independent body reliant purely on ticket sales and donations.


Without a resolution, the DSO expects to run out of endowment money and be broke in two years, according to its website."


If you are not from the Detroit area, you may not care bacause this is a local taxing issue. But, you must ask the question, "when will my local zoo, art museum, or symphony orchestra be added to the lame-duck Christmas tree?"


Perhaps a quick note of encouragement to Senate Leader Mike Bishop and House Minority Leader Elsenheimer would be appropriate. They are both unlikely to support such a tax boondoggle, but some positive reinforcement would likely go a long way. To send them an e-mail, just click on their names.


        Mike Bishop          Kevin Elsenheimer


Have a blessed Thanksgiving!


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