Lyric Opera “clarifies” budget numbers

Thu Jul 10, 2014 at 10:38 am

By Lawrence A. Johnson


When is a reserve fund not a reserve fund?

That question lies at the heart of the Lyric Opera of Chicago’s annual budget statement for the 2013-14 season.

Late week, Chicago Classical Review reported that the company had drawn $15.2 million from reserve funds to balance this past season’s budget of $69.4 million. The story relied on information provided by the Lyric press office.

Lyric officials vigorously disputed the story’s interpretation of the numbers—especially that there was a significant increase in the amount drawn from reserves over 2012-13.

Of the $15.2 million, Brent Fisher, Lyric’s director of finance, says the draw from the new Breaking New Ground fund was $4.8 million (as reported), slightly less than was taken last season from its predecessor, the Campaign for Excellence. There was also $2.7 million in other contributed support for operations. and $0.2 million from other operating income

The remaining $7.5 million was taken from the endowment, referred to in last week’s CCR story as coming from reserves, which the Lyric says is an incorrect attribution.

“The endowment is NOT a reserve fund,” stated Fisher in an email exchange. “[An] endowment spending draw is a common revenue stream for any organization with an endowment,” he said adding that there is “nothing notable” about the practice.

In fact, Fisher says the company is no longer using the term “reserve” for any company fund source. That includes the $4.8 million drawn from the Breaking New Ground fund—even though the company itself has historically referred to the BNG fund’s predecessor, the Campaign for Excellence, as a reserve fund in the past.

“Though last year’s press release referred to the CFE draw as a use of reserve funds, the company does not feel this correctly characterizes the new BNG Fund,” said Fisher. The new fund, he adds, is “a source of support for operations, modernizing Lyric’s stage and equipment, updating marketing and audience development programs, producing productions of the highest caliber, and strengthening the balance sheet for the long term.”

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