Local 802 is in the Black

Financial Vice President's Report

Volume 111, No. 12December, 2011

Tom Olcott

One of my duties as Local 802’s financial vice president is to provide the membership with a report on the financial condition of the union. The bylaws require that we get audited twice a year and publish the results in Allegro. This year’s audit process has been slightly delayed due to a two-month vacancy in the Controller’s office. Nonetheless, I am happy to report that the audit for the period Jan. 1 to June 30, 2011 has been completed in a timely fashion, and the results may be found in the printed version of Allegro. I am even happier to report that the overall condition of Local 802’s finances is healthy.

Since the financial crisis of 2008-2009, Local 802, like virtually every other business, has had to navigate some difficult waters. The union’s response to the crisis has been to budget conservatively, attempt to become a more efficient enterprise, and to continue in its main activities of promoting employment for our existing members, defending and expanding our collective bargaining agreements, and attracting new members whenever possible.

At the same time, the officers and Executive Board of Local 802 are responsible for maintaining the union’s invested funds, and preserving those funds for the benefit of all members. On that front, our investment advisors at Morgan Stanley have provided the union with wise advice, and the Local 802 Executive Board regularly assesses our own internal investment policy. On nearly all of those counts, the first half of 2011 has been a success.

As you review the audit report, I draw your attention to a few items. The report compares the 2010 and 2011 financial performance in comparable periods. Please note that cash and cash equivalents show a 28 percent gain from 2010 to 2011 and that our total assets show a 9.3 percent gain.

On the income side, despite the widely-held perception that work has declined, our dues income shows an increase of 10.5 percent over the comparable 2010 period.

(An additional component of that positive dues report is that the accounting procedure for assessing dues accounts receivable has been modified and has become more accurate in general and also more compatible with Local 802’s computer system.)

Our investments have brought us a 5.5 percent return.

During the same period we have certainly seen an increase in legal and public relations costs. Those costs can be understood in two respects at least.

First, we had a number of high-profile negotiations in early 2011, including the New York City Opera, Radio City Music Hall, Metropolitan Opera and the New York Philharmonic.

Secondly, we also invested in significant public relations campaigns.

Those expenditures have reaped huge benefits for Local 802 musicians and have helped to place the union in its most effective legal and public relations position in many years.

Other than those extraordinary expenses, our overall cost of doing business has declined slightly.

I also must report that our new controller, Cathy Camiolo, has gone to great pains to bring our accounting and reporting systems up to industry standards. Her new eyes on Local 802’s finances have been to all members’ benefit.