Avoiding a Budgetary Disaster

President's Report

Volume CIX, No. 2February, 2009

Mary Landolfi

As I write this column, the economic downturn continues and the consequences of the recession are being felt, not only in the personal finances of all citizens, but also in the budgets of state and local governmental bodies. Here in New York, Gov. Paterson has issued a proposed budget that contains provisions that would be disastrous to the entertainment industry and by extension to the members of this union.

First on the list are cuts to both performing arts organizations and to arts education, some of which have already been instituted to close the budget gap for this fiscal year. The New York State Council for the Arts has already been cut by $2.6 million. Now, for the 2009 fiscal year, the governor has proposed to remove an additional $7 million for a total cut to the state arts budget of 20 percent.

Obviously, these funding reductions will be felt by all arts organizations, but they will be particularly devastating for smaller groups which are less likely to have reserves or endowments, and upon which many Local 802 members depend for their living.

In a move that is all too typical, educational funding formulas are also being cut; we can expect that this will once again raise the specter of cuts to arts education with the inevitable effect on employment as well as on the development of future audiences.

On the other side of the ledger, numerous increases are being proposed to taxes and fees.

Among these is the re-instatement of a tax on theatre admissions. If Governor Paterson’s proposed budget is enacted, an 8.375 percent tax will be applied to theatre tickets; in an environment where productions are already struggling to survive, it is not hard to imagine the effect of this tax — further reductions in attendance and, by extension, fewer productions in existence.

The theatre business is one of the largest economic engines in the city’s economy. With the finance and insurance industries reeling, the city and state are ill-advised to endanger the health of the local entertainment industry by increasing the tax burden on it.

Local 802 is already working with other entertainment unions and the League of American Theatres and Producers to strongly advocate against the adoption of this tax.

Of course, it is not responsible to oppose funding cuts and tax increases proposed by the state administration without advancing another way to fully fund the state budget; as a rule of thumb one should always view with suspicion anyone who expresses negativity about an idea without offering an alternative.

In this case, however, there is a much better solution to the funding dilemma of state and local governments — a “millionaire’s tax.”

If the state were to slightly raise the income tax rate for those making over $200,000 per year, much of the budget gap would be closed. Cuts in essential services could be restored; other nuisance taxes, like the proposed tax on theatre admissions, could be forestalled.

Of course, no one likes to have their tax rate raised, but this action would only restore the rates applied to upper incomes to the level in effect in 1993, hardly a point at which one could call income tax rates confiscatory, and make the rates only three one-hundredths of one percent (.03 percent) higher than the rate that the state of New Jersey is already collecting.

This is the tax plan that the Working Families Party, an organization with which Local 802 is allied, is espousing. (See

I hope that you will take time to participate in the effort to lobby the government on behalf of this alternate plan. If we do not, we have only ourselves to blame if actions are taken that have a devastating effect on our livelihoods.


Local 802 members and staff are doing their part to save the arts. We have multiple trips planned to Albany and Washington, D.C. to tell our political leaders not to cut arts funding. If you’ve never been an activist before, this is the right time for you to get on board. When it comes to saving the arts, musicians can speak from the heart. Contact Paul Molloy at (212) 245-4802, ext. 176 or to get involved.


The special membership meeting called for Jan. 13 did not reach quorum and therefore no official business took place. The meeting was called to consider an appeal by Local 802 member David Finck. For details, see the December issue of Allegro.