President’s Report

When Life Gives You Lemons…

Volume CIX, No. 7/8July, 2009

Mary Landolfi

Health fund a bright spot in otherwise down economy

Our challenges continue as the economy begins to stabilize (we hope). Although the stock market has recovered somewhat from the lows immediately after the financial collapse, it has a long way to go before the effects of the meltdown are ameliorated for pension fund valuations, nonprofit endowments and commercial theatrical investment. As we all know, this business feels the effects of bad economic news early and recovers more slowly than the general economy, but perhaps things are headed in the right direction.

One bright note in an otherwise dismal picture is the strength of our health benefits fund. Since the near bankruptcy of 2006, the fund has rebounded as a result substantial increases in employer contributions, the largest being the diversion of wage increases on Broadway which allowed us to create Plan A+. This was a choice made by the Broadway negotiating committee in 2007 so that the health plan could be improved without any decrease in pension contributions. Now the fund is stabilized and our pension remains untouched. Access to Plan A+ with hospitalization requires performing the same 5.7 shows per week that qualification for the old Plan A formerly did. Plan A is now achievable by performing an average of just over two shows per week.

Another positive indicator: because the cost of providing Plan A benefits is lower than was expected at the beginning of 2007, it is possible that some improvements to that benefit level may be on the horizon. Expect the trustees to proceed cautiously, but if projected costs stay in line, better benefits or lower participant premiums could be coming for Plan A qualifiers.

Returning to the larger picture, however, forces one to acknowledge that many of our members are struggling. Although some in the print media have opined that Broadway is “recession proof”, there have been more straight plays and less musicals produced this year; next year appears to be little different. There is also a definite diminution of work in other venues, whether in the club date field or freelance concerts.

The union is also facing numerous requests for relief from nonprofit employers; determining the appropriate response can be challenging. In some cases the request, though difficult to accept, is compelling. To refuse might mean the end of an organization and the employment it provides or at the very least further cuts in the number of musicians used on a regular basis. In others, the case is less convincing. Each must be treated individually and we are being guided by the objective financial evidence and the priorities of the committee and bargaining unit. One hopeful note: as Allegro went to press, we were informed of a program available through New York State that utilizes unemployment funds to reduce layoffs in the private sector. Our lobbyist is investigating whether that program can be modified to provide funds to nonprofits so that the usual manner of balancing the books – cutting jobs or cancelling concerts – can be avoided.

In the foreseeable future, however, we will have to search for other solutions to expand the opportunities for work for members and increase our ability to bring work under union contracts. I want to emphasize that this does not mean that the union will ever be able to guarantee work for members, however desirable that might be. It does mean that we have to reach out to allies and draw attention to the importance of the entertainment industry to the economic health of the region and the part that live music plays in that industry. The Executive Board recently authorized hiring an outside consultant to help us organize a coalition that will build that pressure. I hope that I will be able to report progress on this effort in the future and that it leads us in the right direction.

One further observation. It is sad but not unusual to find that tough times do not, as one would hope, bring out the best in us. I see evidence of this now within Local 802 – a tendency to believe that there are simple solutions to complex problems and to attack those who point out that there are external realities we cannot avoid. We will not succeed in these tough times by cannibalizing each other and trying to recreate the past. We will only prosper by working together to find realistic solutions to today’s problems.