Our Union’s Finances are Stable

Financial Vice President's Report

Volume 117, No. 6June, 2017

Tom Olcott

Tom Olcott is the financial vice president of Local 802 and the supervisor of the union’s concert department

One of my duties as financial vice president is to assist in the production of the annual audit of the local’s finances and to report the results to the membership. The latest audit was recently completed and reviewed by our accountants, Gould, Kobrick & Schlapp, PC. Their report is published in the printed version of the June 2017 Allegro. Bear in mind that this is a snapshot of Local 802’s finances as of Dec. 31, 2016. The Local 802 officers and the controller meet several times each year to create a budget. We always consider many factors. The most important are: 1. Our best assessment of the state of the music business and the projected flow of dues revenues. 2. A reasonable estimation of future union costs (upcoming negotiations, organizing campaigns, public relations and legal needs, personnel costs, building maintenance, etc.), based on prior experience. 3. Close observation of prior trends in our budgeting. Our primary goal is always to ensure that Local 802 members’ money is spent responsibly.

Considering the above, our latest numbers should reassure us all. Compared to 2015, dues revenues declined by a mere $8,000, with minor slippage in both regular and work dues. We have negotiated new leases for our tenants on the union’s sixth floor, and we now show increased rental income of more than $30,000. Each one of these leases has multi-year terms, with built-in annual raises in rent. Assuming the lessees remain solvent – and all are quite healthy – that income will steadily increase. Our investments, which are managed by Morgan Stanley, benefited by the positive stock market and investment climate. Our combined realized and unrealized gain investments increased by $84,000.

There is also a one-time anomaly in the revenue stream. Local 802 was a beneficiary of the estate of deceased Local 802 member Edward M. Goldsmith, who bequeathed us $103,865. We are thankful for his generosity. Our goal was to write a story about him, but the truth is that Mr. Goldsmith remains a mystery to us. We only know he was a pianist born in 1937 who lived in New York City, most recently on Avenue C. He was a member of Local 802 from 1954 to 1998, and he died in 2013. We have not found out much else about him, but we thank him nonetheless. (If anyone knew Mr. Goldsmith or knows any more about his life, please contact me.) In any event, his bequest was a one-time event, and that revenue is unlikely to recur. Absent Mr. Goldsmith’s bequest, the above revenues would be smaller. Unrestricted net assets are down by less that 1 percent, which were essentially flat compared to 2015.

Local 802’s finances are stable, but are always subject to increasing expenses – and in all likelihood, we won’t see another large bequest. We’ll need to be prudent going forward. We all live in a professional music world that, to many members, seems to be declining. On the other hand, when we measure the amount of work dues coming in to the union, that number remains stable, and that is a mathematical, objective way to measure our members’ musical employment. Stability is good. Our investments also did well last year, and that reflected an improved economy in 2016. (Stay tuned on that one, of course.) Local 802 can never immunize itself from larger macroeconomic developments nor can we ignore the stark unpredictability of the current political climate. The union must always stay relevant to our members’ lives and we should always help unionize new work. We should also consolidate and protect our current contracts. We should help our members stay united to enforce fair wages and benefits. We will always pursue and support those efforts and will certainly continue to provide dedicated service to our members. That has always been our pledge, and these audit numbers confirm Local 802’s real ability to continue that commitment in uncertain times. As we proceed, please remember that members are the union, and that our unity is our greatest strength. Best to all.