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Recent Trends in Program Coverage, Artistic Expenses and Individual Giving
Larry Bomback, Director of Finance and Operations, OPERA America
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Original Content10/29/2009

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Over the past 10 years, professional opera company budgets in the U.S. grew annually, on average, at a rate that was about two to two-and-a-half times the U.S. consumer price index (CPI)i. During consultations with board members and general directors, OPERA America President and CEO Marc A. Scorca referred to this percentage as the Opera Price Index (OPI). Core artistic expenses (the sum of artistic personnel, technical/production personnel and production costs) are an important element of this "opera-flation."

Among the 53 U.S. companies that comprised the 10-year constant sample groupii, the percentage of total company budgets allocated to these core artistic expenses has remained remarkably steady at about 60% throughout this time span. However, the percentage of these core artistic expenses covered by ticket sales has declined considerably from 68% in the 1998-1999 season to around 56% in the 2007-2008 season.

The data presented above is not all that surprising. Indeed, it only serves to reinforce a sentiment shared by many general directors during conference calls as well as at the first OPERA America Strategy Committee meeting in September 2009: that opera companies have become increasingly reliant on contributed income, especially individual contributions. As the chart below clearly demonstrates, from 2000 to 2008, total individual contributions to the 53 companies in the constant sample group grew by nearly 90%.

OPERA America continues to strategize about how to best capitalize on this trend. In meetings of the National Trustee Forum, for example, boards are being challenged today to address the issue of who will be giving tomorrow. On the advocacy front, OPERA America continuously provides updates on legislation that could impact marginal tax rates and charitable deductions. And in meetings of the technical/production and artistic administration networks, companies are sharing ideas with one another about how to best cut costs without compromising quality.

The future of individual giving will be a primary focus of Opera Conference 2010: New Realties | New Strategies. A general session featuring Wells Fargo Chief Economist, Dr. John Silvia, will provide information about the latest trends in Washington and on Wall Street that will have direct effects on consumption and philanthropy. Additionally, the prominent philanthropist and founder of KB Home and SunAmerica, Eli Broad, will close out the Conference with his outlook for the future of the art form and its business model.

i The U.S. C.P.I. from 1998 to 2008 was 2.82%.

ii The 53 companies are Florida Grand Opera, Houston Grand Opera, Los Angeles Opera, Lyric Opera of Chicago, San Diego Opera Association, San Francisco Opera, Seattle Opera, The Dallas Opera, The Santa Fe Opera, Utah Symphony | Utah Opera; Austin Lyric Opera, Boston Lyric Opera, Central City Opera, Florentine Opera Company, Fort Worth Opera, Glimmerglass Opera, Lyric Opera of Kansas City, Opera Colorado, Opera Company of Philadelphia, Opera Theatre of Saint Louis, Palm Beach Opera, Pittsburgh Opera, Portland Opera, Sarasota Opera, The Atlanta Opera, The Minnesota Opera, Virginia Opera; Dayton Opera Association. Des Moines Metro Opera, Indianapolis Opera, Kentucky Opera, Madison Opera, Nashville Opera, Opera Theater of Pittsburgh, Syracuse Opera, Tri-Cities Opera Company, Tulsa Opera; Amarillo Opera, Lake George Opera at Saratoga, Musical Traditions, Music-Theatre Group, Opera North, Pacific Repertory Opera, Pensacola Opera, Piedmont Opera.
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