It seems that using revenue from subscription ticket sales to pay current debts is finally becoming recognized as a bad business practice. Back in November I wrote an article about this very issue and suggested that orchestras need to eliminate their dependence on future subscription sales to pay current debts.
I was pleased to read fellow AJ blogger Andrew Taylor’s piece yesterday which focused on this very same issue. Although I’m not glad to see this bad habit gallop through the non profit culture world en masse, I’m glad to see that the industry as a whole is starting to talk about it.
Then I went to Arts Journal’s main page to find a link to the article in the San Antonio Express-News that examines the new plan to put the San Antonio Symphony back in business. Here’s an excerpt fromt he article by Mike Greenberg and L.A. Lorek:
[San Antonio Symphony] Board member Ken Oleson said advance ticket sales for next season would be placed in escrow and used for that season’s expenses a departure from standard practice of most major orchestras.
So how about that? In order to make their reorganization plan more appealing to the symphony’s current creditors the board adopts a fiscal practice that is a “departure” from what most major orchestras follow. So I ask the following question: “Why do most other orchestras follow this practice?” Here’s the simple answer: Because it’s been done that way for so long that no one even bothers to question whether it’s a sound financial method or not.
As for the San Antonio Symphony, I hope their creditors will see this aspect of the proposed plan as a good step toward building a stronger tomorrow. And for the rest of America’s orchestras, it’s time to pull their collective head’s out of the sand and stop following this dodgy business practice. As a sign of good faith to their core subscribers, I think all orchestras should voluntarily place the income from subscription ticket sales into escrow accounts to be used for that season’s expenses, regardless of their current financial situation.