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PSO, Trust foresee more cooperation in light of N.Y. merger

Tuesday, June 03, 2003

By Caroline Abels and Andrew Druckenbrod, Post-Gazette Staff Writers

The New York Philharmonic and Carnegie Hall announced yesterday they are discussing making the 112-year-old Manhattan hall the home of the Philharmonic. The orchestra's departure from Lincoln Center's Avery Fisher Hall could come as early as the 2005-06 season.

Although the details of the merger have yet to be discussed, a consolidation of the organizations' endowments could create a powerhouse portfolio of $268 million, and sharing overhead expenses could help the orchestra cut costs. The Philharmonic, like the Pittsburgh Symphony Orchestra, has canceled a tour to Europe for financial reasons.

Given the national significance of the Philharmonic and Carnegie Hall, the unexpected consolidation raises the possibility that a stronger collaboration between the Symphony and the Pittsburgh Cultural Trust could be viewed more favorably as a way to stabilize the Symphony's finances. The Trust, an arts presenting organization that owns four theaters in the Downtown Cultural District, has for five years successfully brought the PSO and Downtown arts groups together in its "shared services" initiative.

Recently, the Trust took over two local arts organizations to boost their financial health. It took the Pittsburgh Dance Council under its wing in 2001 and absorbed First Night Pittsburgh earlier this spring. Both organizations retained their name and artistic independence but cut costs dramatically by ceding marketing and other overhead to the Trust.

Yesterday, Trust president Kevin McMahon acknowledged that people in the Pittsburgh arts community have been speculating on ways the Trust can help the PSO, which is saddled with a structural deficit of more than $2 million and a performance hall that isn't profitable.

But McMahon said the Trust and the PSO have not discussed a merger.

Instead, McMahon and Thomas Todd, president of the PSO board, said the Trust's shared services initiative, which helps Cultural District arts organizations cut costs by making joint purchases and sharing marketing data, may be expanded to allow the Trust to provide the symphony with more cost-saving opportunities.

"Short of a full consolidation of the organizations themselves, any kind of joint activity that reduces costs or increases quality of service is definitely worth exploring," Todd said. "Managing the hall is one possibility."

McMahon adds, "Are there ways we could help identify savings in operating the building? Maybe. But we haven't really examined those yet. We are talking continually through the auspices of shared services about ways to extend our cooperation. But they're small things rather than fundamental ones like completely running their administrative offices."

The Trust is not negotiating to buy Heinz Hall, which the Symphony says is worth $40 million, nor is the PSO actively looking for a buyer. It has not retained a real estate broker.

"We are not in a position financially to purchase the hall," McMahon said.

It is possible, however, that a donor may emerge to give a major gift that would cover the cost of the hall.

"If there were a way of getting the value of Heinz Hall and retaining operational control, of course we would consider it, but that is a big if," Todd said.

Caroline Abels can be reached at cabels@post-gazette.com or 412-263-2614. Andrew Druckenbrod can be reached at druckenbrod@post-gazette.com or 412-263-1750.

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