by Jim Ridley
At The City Paper, Steve Cavendish has a first-rate analysis of Bank of America's declared foreclosure on the Nashville Symphony Orchestra, which he reads as ninth-inning hardball in a heated negotiation gone all too public:
The two sides have been negotiating over the terms of the debt, which was used to build the beautiful hall for an award-winning set of musicians, for some time. In a letter to patrons on Wednesday, the symphony acknowledged a decline in revenue, noting that it “is operating at a loss and needs to take aggressive action to get its finances in shape.”
But the biggest financial problem — and one that’s not going away — is service on their construction debt. Whether you believe that the 2010 flood caused greater problems than they could have anticipated, as the symphony claims, or that the organization has been burning through money at an unsustainable rate for years, as the banks claim, there is still more than $80 million in outstanding debt.
Bankers were furious that the symphony declined to renew a letter of credit in the spring. Sources told The City Paper in April that they had even examined legal options against the board for a failure of oversight on the symphony’s finances.
What we’re witnessing is a giant game of chicken. Unable to negotiate better terms, the symphony walked away from the previous deal. Unwilling to be strong-armed into reducing the debt, Bank of America called the symphony’s bluff and announced foreclosure.
The NSO doesn't want to lose its world-class concert hall and home, and the banks can't want it if they hope to recoup upwards of $80 million. After all, the facility is what it is — a concert hall built to the specifications of a symphony orchestra — which stands to make the announced June 28 auction date the biggest white-elephant sale in the city's history.
So: How do we save the symphony — and we must — without poisoning the fiscal well for other worthy arts organizations that approach local banks with ambitious plans? At this point, we're not ruling out Kickstarter.