Metropolitan Opera Cancels Season Over Virus and Faces $60 Million Loss

The move, a day after the Metropolitan Museum of Art said that it would stay closed at least until July and expected a nearly $100 million shortfall, is another stark sign that even the country’s richest cultural institutions face a profound threat from the outbreak. The opera company’s orchestra, chorus and stagehands will not be paid past March, though they will retain their health benefits.

“We’re doing the best we can under a horrendously difficult situation,” Peter Gelb, the company’s general manager, said in an interview. “As far as our union employees are concerned, we are trying to do the best we can by them, given the financial constraints that we have.”

Leonard Egert, the national executive director of the American Guild of Musical Artists, the union representing the Met’s chorus, soloists, stage directors and others at the opera house, said: “We recognize it’s unprecedented times. We appreciate the Met keeping health insurance coverage for full-time artists. But it’s a devastating mental and financial toll on our artists.”

“If I had to sum it up,” he added, “the consensus is: We’re disappointed, we’re upset, but we understand.”

While some losses of ticket and fundraising revenue will be mitigated by lower operating expenses, Gelb said that the decision to scrap the season, originally scheduled to end on May 9, would expose the Met to a net shortfall of $50 million to $60 million. The company announced an emergency effort aimed at raising that amount, with initial pledges from board members of $11 million.

Gelb added that he would forgo his salary until operations returned to normal. Pay will be cut by 25-50% for senior management, and by 10% for nonsenior administrative staff making more than $125,000 a year. There are no planned salary cuts for those making less than that, and no plans for layoffs of administrative staff.

“We need an administrative staff to keep the institution running without performances,” Gelb said. “The business of the Met has to go on.”

Last week, the Met canceled performances through March 31, part of a wave of temporary closures of theaters and concert halls around the world in response to the outbreak. But after the Centers for Disease Control and Prevention recommended on Monday that gatherings of more than 50 people be avoided for at least eight more weeks, organizations began to extend those closures.

Carnegie Hall canceled its performances through May 10, and Adam Crane, a spokesman for the New York Philharmonic, said in an email that the orchestra “will be making a significant announcement at the beginning of next week regarding the status of the rest of our season.”

Throughout the country, arts organizations that have been shut by the pandemic have been dealing with the question of how to compensate employees. Some have chosen not to invoke what are known as contractual “force majeure” clauses, which give institutions substantial latitude to withhold compensation if they have been closed by forces beyond their control.

“We’re negotiating with companies around the country,” said Egert of the union. “And they’ve really ranged. Some of the smaller companies, like Sarasota Ballet, are paying all of their artists through the season.”

But Gelb said that would be impossible for an opera company the size of the Met, which despite its $308 million annual budget has little financial cushion. (Its endowment, valued at $284 million in 2018, is less than a tenth the size of the Metropolitan Museum’s.)

“We are not laying people off,” Gelb said. “We are continuing to give them health benefits. Our operations have been suspended, and we cannot afford to pay them. We would go out of business in a matter of weeks, and that’s why these contracts have force majeure clauses in there.”

Classical music and grand opera, labor-intensive and expensive to produce, are particularly vulnerable to downturns, and institutions of every size are now contemplating not just the loss of their spring seasons, but also summer activities, particularly if rehearsals cannot begin as scheduled in May or June.

“Once you’re over the disappointment of artistic cancellations,” Marc Scorca, the chief executive of Opera America, a trade organization, said in an interview, “you’re looking at the viability of institutions.”

Referring to the recession that began over a decade ago, he added, “There are companies, just as in 2008 to ’09 — there are some that have some fundamental health and weather through it. Some were held together by Scotch tape, and the Scotch tape came loose. And no doubt that is going to be played out again.”

Michael M. Kaiser, the chairman of the DeVos Institute of Arts Management at the University of Maryland, said that midsize organizations faced the greatest risk. “The largest organizations, as horrible as it’s going to be, they will not go bankrupt,” he said in an interview. “They will figure out a way through this. As scary as it must be, that’s the Met Opera.”

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But extended closures in the past have had long-term effects on the Met. A three-month labor battle in 1969 caused nearly 20% of its subscribers to cancel, and it took the company years to recoup the losses, a situation repeated after a lockout in 1980.

There was also labor unrest, though no lockout, in 2014, when the company won concessions from its unions that it said were necessary for its survival. Since then, the Met has weathered sexual abuse allegations that led it to fire its longtime music director, James Levine, and successfully introduced his successor, conductor Yannick Nézet-Séguin. This year the company introduced Sunday matinees; and two new productions, the Gershwins’ “Porgy and Bess” and Philip Glass’ “Akhnaten,” were box-office hits.

In November, though, the outlook on the company’s “A” credit rating was revised to negative by S&P Global Ratings, which warned of “weak balance sheet metrics” and noted that the endowment was “low for an organization of its scope.”

But Gelb pointed to the strength of the company’s board, which has enabled it to weather past crises. “We’re looking at this as a temporary emergency,” he said. “I believe that the Met will rebound. It must rebound.”

This article originally appeared in The New York Times .