Opera's debt problems accelerated in 1988-89

October 19, 1990|By Ernest F. Imhoff | Ernest F. Imhoff,Evening Sun Staff

The Baltimore Opera Company must raise $270,000 in cash from individual and corporate donors by Dec. 31 or cancel its last two productions of the year, Verdi's "Un Ballo in Maschera" and Puccini's "Madama Butterfly," BOC officials said yesterday.

Overall, the company has an accumulated deficit of $840,000 and needs to raise $1 million by June 31, 1991, or face bankruptcy. Donors have already given $400,000 in cash and pledges with and without strings, so $600,000 is still needed by next June.

Baltimore Opera officials expressed optimism they can save the BOC.

"There are many positive factors about the company," said Michael Harrison, the general director. "We have already set a single ticket sales record with $110,000 from "Carmen," the largest in BOC's 40-year history. The subscription rate renewal is 84 percent. Further, our earned income is 53 percent of our income; most opera companies are about 40 percent."

Figures supplied yesterday by Nizam Kettaneh, BOC director of finance, showed this picture:

The BOC had an operating surplus of $1,293 in the year ending in May 1986, $41,853 in 1987 and $75,737 in 1988. These pluses reduced the accumulated deficits from $336,853 to $295,000 and then $219,268.

In 1988-89, clouds floated in and last year built to a sizable storm:

In the year ending in May 1989, the former annual surplus changed to a $145,244 operating deficit, raising the accumulated deficit to $364,512. And in the 1989-90 year ending in June 1990, the operating deficit exploded into an estimated $475,000 (the audit isn't official yet), resulting in the current accumulated deficit of $840,000.

The $270,000 required in the short term was explained this way: Of the $1 million needed by next June, the company needs $500,000 in cash by year's end to mount "Ballo" and "Butterfly."

Already, donors have given $110,000 in cash and another $120,000 in pledges without strings. The $270,000 goal by Dec. 31 makes up the difference in the $500,000.

Still another $170,000 has been raised in pledges, but they are contingent on the BOC raising its total of $1 million by next June.

The BOC operating deficit of almost half a million last year, the first full season with Harrison as general director, was blamed on several factors by officials:

Cost overruns following a decision to put on better quality and thus more expensive shows, less donor and federal support than expected, less than aggressive fund-raising and a transition period when 90 percent of the staff turned over in new hires. The staff numbers 11 now.

A number of economy moves have been undertaken in recent months to accompany the more intense fund-raising drive planned in coming weeks, Harrison and Kettaneh said:

* A renewed effort by the board to monitor all expenses and prevent cost overruns, partly with the May hiring of Kettaneh. An accountant with an MBA from Loyola College, he has controlling functions and reports to the board treasurer, Nancy Sasser, rather than the general director. Previously, the general director was chief finance officer and a staff bookkeeper had no controlling duties.

* Replacing, in a spring announcement, an expensive "Tristan und Isolde" with a Wagner concert as the second offering in December (after subscribers had mailed in orders for a four-opera season including "Tristan"). "Better an excellent concert than a lousy opera," Kettaneh noted.

* Moving the opera warehouse from a $50,000 rental at a Falls Road location to a $5,000 Glen Burnie facility, courtesy of a gift from the owner, a board member. The opera offices were also moved, from Charles Street to less costly offices in the Medical Arts Building on Cathedral Street.

Harrison credited the BOC's "guiding light," Charles S. Garlan Jr., chairman emeritus, with many of the positive energies that have sustained and led the opera over the years. Garland was a trustee for 20 years and former president and chairman of the board.

Garland became ill earlier this year but continued to work for th opera, including writing letters up until his death of cancer, Harrison said. Garland died Saturday night, the opening night of "Carmen," which he and his wife, Joan, had helped underwrite.

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