Romanstein Out, Eyes Turn to the WAC

Well.  Yesterday, Stanley Romanstein resigned as President and CEO from the Atlanta Symphony Orchestra (ASO). I did not see that coming. But given the fact that the ASO labor dispute has almost exactly paralleled that of the Minnesota Orchestra, albeit under an astonishingly compressed time frame… perhaps I should have.

I have been critical of Romanstein here, primarily in regards to the public statements he has made or have been released under his name. It’s probably clear by now that I did not agree with the business model he championed—as I’ve said repeatedly, my impression is that he is treating the musicians as personnel, as opposed to his core product. Plus, his strategy for future prosperity seemed to entail little more than forcing concessions from the musicians… even though that exact same strategy was tried two years ago without success.

I stand by my criticisms, and feel Romanstein’s departure is a positive move.

But as I take in this surprising turn of events, I have to wonder what the real impact of this move will be.

As the lockout has progressed over the last few weeks, many have openly wondered how much of this whole nasty affair was Romanstein’s idea, and how much was simply being dictated from much higher up on the food chain. Norman Lebrecht, a commentator of strong opinion, clearly believes that Romanstein was a weak leader “ordered” by his board to engage in a lockout, and that he was cast out by that same board the minute things started to go badly. Drew McManus has similarly pointed out that Romanstein would have to act in conjunction with the board of directors.

So, I think it is fair to say that the consensus view is that the board, not Romanstien, has been calling the shots.

But it is interesting to consider which board is calling the shots.

The ASO has its own board, of course, but there is a far more important player in the room—the Woodruff Arts Center (WAC). The WAC functions as an umbrella organization that oversees not just the ASO, but four arts divisions including the Alliance Theatre and the High Museum of Art.

And it is increasingly clear that the WAC is the real force behind the lockout.

This is hardly a new idea; the notion that the WAC is managing (or to be frank, mismanaging) the lockout is widely discussed around the country, including by the New York Times’ Michael Cooper.

This impression was amplified over the past week, as ASO board member Ron Antinori resigned, specifically citing the fact that the ASO board has been kept in the dark about the lockout and could do little about it. ArtsATL has more on this story:

“I didn’t feel that my voice and my opinions as [an ASO]  board member had much of an effect on what was happening,” Antinori told ArtsATL, noting that he did not know that the management was planning to lock musicians out until just two days before the deadline for contract negotiations. “I am not privy to what WAC’s motivation is. That’s the elephant in the room. All I know is what I’ve heard: ‘We need to balance the budget.’ Am I suspicious? I honestly just don’t know. There does seem to be a mentality of ‘We don’t care if we destroy the orchestra as long as we balance the budget.’”

So for good or for bad, I think we can all agree that the real power broker here is the WAC.

And that raises a question. If the real power lies with the WAC board, does Romanstein’s departure mean anything? It is simply a quick public relations move designed to create a sense of momentum? Or a delaying tactic? Was he simply cast off for being unable to control the situation? Will the WAC become more directly involved, or start to act more openly? It is far too early to tell.

But it does mean the WAC bears close scrutiny.

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And in that vein, there’s something I’m keeping my eye on—the way that the WAC has been handling the finances of the ASO.

And it appears that the ASO has been on the losing end of several transactions that could have greatly helped the orchestra’s bottom line.  The ASO musicians have pointed out that in both 2012 and 2014 the WAC received substantial funds from the sale of two properties and gifts that could have “mitigated or eliminated completely” the orchestra’s annual deficit in those years. After receiving a $15 million gift from the Woodruff Foundation in November 2011, the musicians noted, the WAC gave $5 million to the Alliance Theatre and the High Museum to retire debt. No funds were allocated to the ASO, which had an accumulated debt of $20 million. Perhaps the most curious fact that when the WAC sold off property, the proceeds were not shared with the ASO at all—in one case, the proceeds were donated to another non-profit.

The WAC denies any wrongdoing and states that all the transactions in question were completely benign. But taken together these transactions do come off as odd—a non-profit that’s reporting financial difficulties decides to sell off property… and donates the proceeds to another organization instead of using them to help its tattered bottom line? I understand there is some history there, but still….

I doubt I’m the only one wondering if these transactions were done to create artificial deficits for the ASO, which could be used as a weapon against the musicians when it was time to renew their labor contract.

A comparison to the Minnesota Orchestra lockout is instructive in this regard. The board meeting minutes from the Minnesota Orchestral Association (MOA) in 2009 show that the MOA manipulated its finances to show different “truths” about the organization to different audiences. These differing accounts of the Orchestra’s finances came to light in an article that appeared in the Star Tribune (the state’s largest newspaper) on December 6, 2012:

For four years, the Minnesota Orchestra board has walked a tightrope between managing public perceptions about its financial health and making its case to cut musicians’ salaries.

As early as 2009, board officers were discussing how much money to draw from investments, and the advantage of reporting balanced budgets at a time when the orchestra was raising funds and seeking state money.

“Balances in 2009 and 2010 would support our state bonding aspirations,” Bryan Ebensteiner, vice president of finance, told the orchestra’s executive committee in September 2009, “while the deficits in 2011 and 2012 would demonstrate the need to reset the business model.” His comments are included in minutes of the finance and executive committees obtained by the Star Tribune.

It also came out that the size of the deficits posted in 2011-2013 were determined by the MOA’s hired public relations firm, Padilla Speer Beardsley; as a result, it seemed the deficits the MOA was reporting were somewhat artificial, and driven by other factors besides a tough economic environment.

State lawmakers were furious when this information came to light, and demanded the resignation of then-President Michael Henson, then-Board Chair Jon Campbell and then-lead negotiator Richard Davis. And indeed, all three quickly left the organization once the labor dispute was resolved.

With that background, it’s hard for me not to wonder if a similar game plan has been used by the WAC.

It also makes me curious to hear a fuller explanation about how the WAC’s budgeting process works and what its institutional priorities are.  Plus, I’d appreciate a fuller discussion about its expectations and goals for the ASO, and how they relate to the other members of the WAC family.

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So while I think Romanstein’s departure was a necessary step, I feel the problems go far beyond him. In fact, they go far beyond the ASO’s board, too—reaching up to the WAC board.

It is to the WAC that we must now turn our attention.