New Symphony Board Abandons Transition Agreement

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Nicholas Frank / Rivard Report

A San Antonio Symphony musician holds a sign at a Dec. 21 news conference after negotiations between the musician's union and management stalled.

The future of the San Antonio Symphony is in limbo after three of its largest donors on Wednesday pulled out of a transition agreement to take over operations and budget of the city's 78-year-old symphony.

When leaders of the Symphonic Music in San Antonio (SMSA), a nonprofit formed earlier in the year to take over symphony leadership, learned of a pension fund liability, there was "no appetite for completing the transaction ...," said Tom Stephenson, SMSA's executive director. "That's a deal breaker."

As for the future of the Symphony, he said: “I think only time will tell how all this will evolve."

Leaders of the musicians' union expressed deep disappointment at the latest roadblock in contract negotiations, with one calling SMSA's citing of the pension liability as a "false excuse."

SMSA began the transfer of leadership on Sept. 1 from the Symphony Society of San Antonio, which has led the Symphony since its founding in 1939. In evaluating the Symphony Society's assets and liabilities prior to takeover on Nov. 22, SMSA received a letter from the American Federation of Musicians & Employers' Pension Fund.

The letter, dated Nov. 21, detailed the pension fund liability, which had been undisclosed in a prior audit report from the Symphony Society, SMSA Board Chair J. Bruce Bugg Jr. said.

“We made it clear from day one that SMSA would not be in a position to assume any liabilities of the Symphony Society,” he said. “Our charitable contributions were designed to pay for the musicians’ salaries and operating expenses."

The SMSA board is comprised of Bugg, who also serves as the chair of the Tobin Endowment; Dya Campos, H-E-B director of public affairs; and J. Tullos Wells, managing director of the Kronkosky Charitable Foundation.

The SMSA released a statement on Dec. 27 referring to an underfunding of the pension fund by the Symphony Society. However, the Symphony "was and has been current on its payments to the pension on the musicians’ behalf,” Symphony Society Board Chair Alice Viroslav stated in an email. Stephenson confirmed that the pension contributions are up to date.

SMSA would not be making any further contributions to the Symphony Society, Bugg said, adding that the Symphony Society leadership “has some decisions to make as to how they deal with their legal and financial issues.”

"The Symphony Society board will be meeting early next week to discuss next steps,” Viroslav said, and will then issue a statement regarding implications for the rest of the season.

Negotiations for a new contract with Symphony musicians, whose current contract expires Sunday, Dec. 31, were put on hold after management reportedly walked out of a meeting on Dec. 18.

At a news conference held outside the Tobin Center for the Performing Arts on Dec. 21, Craig Sorgi, Symphony violinist and negotiating chair for the Musicians of the San Antonio Symphony, said of the looming deadline, “We’ll have to see what happens then. It’s situational, very fluid. Right now, we’re taking it one day, sometimes one hour at a time.”

Sorgi and Brian Petkovich, secretary-treasurer for the local chapter of the American Federation of Musicians (AFM), had been negotiating with Viroslav, Stephenson, and a lawyer representing both parties. Sorgi said the musicians' union's lawyer sent a letter to symphony management negotiators Tuesday, asking for contract negotiations to resume as quickly as possible.

"The board members of [SMSA] are attempting to excuse their abandonment of the San Antonio Symphony by using the AFM pension plan as their scapegoat," Sorgi wrote in a statement Wednesday. "This is a false excuse."

The Nov. 21 letter stated that if the Symphony Society pulled out of the pension plan, it could trigger a withdrawal penalty of more than $8.9 million.

If the two organizations involved in the transition of symphony leadership were to "merge and maintain the pension plan, there would be no withdrawal liability," Sorgi stated.

The $8.9 million withdrawal liability would be incurred if the Symphony Society "experienced a complete withdrawal" from the fund, the letter stated.

Asked whether H-E-B will continue its role as the largest corporate donor to the current Symphony, SMSA board member Campos wrote in an email on Wednesday: “After months of going through the exercise of unraveling this complex situation, one positive thing we discovered is that the San Antonio community and our corporate peers are very dedicated to supporting quality symphonic music in our city.”

Responding to whether he has a clearly defined role going forward, Stephenson said, “I’m work[ing] right now at the same office I’ve been in for three months.”

The Symphony’s Tricentennial Concert at the Tobin Center is scheduled for Jan. 5-6, under the baton of conductor Sebastian Lang-Lessing.

"The Musicians of the San Antonio Symphony stand ready, willing, able, and enthusiastic to present the rest of the 2017-18 season," Sorgi said.

7 thoughts on “New Symphony Board Abandons Transition Agreement

  1. This is a complex situation wrapped within high emotions. In addition to the musicians and both existing and proposed management companies, the timing of the breakdown is painful to many (like me) who made year-end financial contributions with the expectation of a future for the symphony but without knowledge of the impending crisis. Lots of shared pain to spread around…… I hope a solution can be found that no one likes but everyone can stomach.

  2. There is a breakdown in our nonprofits. Many board members do not understand the complexities of running an organization and think it is easy. Good nonprofit policies and practices are necessary, along with board development and training. This is not the first scenario of bad fiscal policies, and it will not be the last. Having professionals that have worked in nonprofits, even not in SA, could be beneficial to the city. Instead, outsiders are driven out in short time periods and the “leadership class” remains intact that created situations like this. Just because a person might have business experience does not lead to good nonprofit experience.

      • I hardly think that musician salaries in san antonio are commensurate with their talent and training coats. Whether or not you think their pension plan is “generous” or not is not important because everyone knew about it all along. This shouldnt be a surprise. It is an obligation that if circumstances change, then future actions change. It shouldn’t be in retrospect.
        That said, i prefer to donate to more accessible classical radio than being stuck in a chair for a live performance at what i think of as a higher cost for less enjoyment. Maybe if they played at an open air beer garden. Too bad people dont meet up to waltz anymore.

  3. I suspect the real problem the SMSA sponsors have is the collapse in the symphony’s financial condition. Their contribution of $2 million since last spring implies an annual operating loss of over $3 million which they probably feel they would have to cover. We know that attendance at the classics concerts has collapsed. It appears that contributions may have followed the same trend. No surprise they want to walk away. Turning the situation around would require a major effort from public and private leadership in the community. What I sense, however, is profound fatigue.

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