Joel R. Glucksman
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New York City Opera Files for Bankruptcy
Author: Joel R. Glucksman
Date: October 17, 2013
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The iconic New York City Opera, a top cultural and historic attraction in the city for more than 70 years, has announced it will be closing its doors and has filed for bankruptcy protection.
After its attempt to raise $7 million through aggressive fund-raising efforts failed, the company said its only option to overcome its financial shortfalls was to file for protection under Chapter 11 of the bankruptcy law. The struggling opera company had sought to raise these funds by September 30, but spokeswoman Risa Heller said that only about $2 million had been donated, plus an additional $301,019 in pledges.
“New York City Opera did not achieve the goal of its emergency appeal,” Heller said. “Today, the board and management will begin the necessary financial and operational steps to wind down the company, including initiating the Chapter 11 process.”
The city opera ran into financial difficulties as a result of several poor decisions by its board of directors, CBS News reports. This includes the board’s choice to close the opera for the 2008-09 season while its auditorium underwent reconstruction. The company has also been criticized for hiring Gerard Mortier as artistic director, who later backed out before the season began. The board’s fateful decision to leave the Lincoln Center after the 2010-11 season in favor of playing at various venues throughout the city also led to a steep decline in revenue. Lastly, records show that City Opera’s endowment has shrunk from $48 million in 2008 to $5.07 million at the end of June 2012, the New York Times reports.
The company filed for bankruptcy protection with the United States Bankruptcy Court in the Southern District of New York and listed assets of $7.7 million and liabilities of $5.6 million, including pension obligations. In addition to its pension responsibilities, the city opera listed its largest creditor as the New York City Ballet. The ballet has a $1.6 million claim against the opera company.
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New York City Opera Files for Bankruptcy
Author: Joel R. Glucksman
The iconic New York City Opera, a top cultural and historic attraction in the city for more than 70 years, has announced it will be closing its doors and has filed for bankruptcy protection.
After its attempt to raise $7 million through aggressive fund-raising efforts failed, the company said its only option to overcome its financial shortfalls was to file for protection under Chapter 11 of the bankruptcy law. The struggling opera company had sought to raise these funds by September 30, but spokeswoman Risa Heller said that only about $2 million had been donated, plus an additional $301,019 in pledges.
“New York City Opera did not achieve the goal of its emergency appeal,” Heller said. “Today, the board and management will begin the necessary financial and operational steps to wind down the company, including initiating the Chapter 11 process.”
The city opera ran into financial difficulties as a result of several poor decisions by its board of directors, CBS News reports. This includes the board’s choice to close the opera for the 2008-09 season while its auditorium underwent reconstruction. The company has also been criticized for hiring Gerard Mortier as artistic director, who later backed out before the season began. The board’s fateful decision to leave the Lincoln Center after the 2010-11 season in favor of playing at various venues throughout the city also led to a steep decline in revenue. Lastly, records show that City Opera’s endowment has shrunk from $48 million in 2008 to $5.07 million at the end of June 2012, the New York Times reports.
The company filed for bankruptcy protection with the United States Bankruptcy Court in the Southern District of New York and listed assets of $7.7 million and liabilities of $5.6 million, including pension obligations. In addition to its pension responsibilities, the city opera listed its largest creditor as the New York City Ballet. The ballet has a $1.6 million claim against the opera company.