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L.A. Opera’s $14 Million Imbroglio 

Superstar Plácido Domingo pushes the company closer to worldwide acclaim — and financial collapse

Wednesday, Jan 13 2010
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The most famous top executive of any arts organization in the world is certainly the superstar tenor who also serves as general director of the Los Angeles Opera — but on any given day, where in the world is Plácido Domingo? 

“I don’t know, he’s everywhere, he could be anywhere,” Stephen D. Rountree, president of the Music Center and chief operating officer for L.A. Opera, tells me in his Music Center office at the Dorothy Chandler Pavilion, now L.A.’s de facto opera house. “He was just in Acapulco with his family for the holidays.”

“I think currently on the East Coast,” Gary Murphy, the opera company’s communications chief, adds with a little more confidence. “He maintains residences in L.A. and Washington, D.C. [where he is also general director of the Washington National Opera], in New York City and elsewhere. Right now, he is in rehearsals at the Met for Simon Boccanegra and Stiffelio.”

click to enlarge SHEILA ROCK - Plácido Domingo, general director of L.A. Opera
  • Sheila Rock
  • Plácido Domingo, general director of L.A. Opera

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None of that mattered much until last month, when the opera’s globe-trotting and often remote superstar was given a $14 million last-minute bailout from Los Angeles County, amid indications that the opera company has overreached with its recent dramatic, high-profile and altogether costly Ring Cycle and coming Ring Festival.

Domingo, who is in L.A. for weeks at a time when he is conducting and singing, calls most of the artistic shots at L.A. Opera, sorting out whatever is debatable with the company’s esteemed musical director, James Conlon.

In their tenures, Domingo and Conlon have made L.A. Opera one of the top opera companies in the world by many measures. The company attracts world-class talent for new productions. It often uses operas in repertoire to showcase budding stars, many of whom have won Domingo’s own international competition. The duo’s two long-standing pet projects — Wagner’s Ring Cycle, and the Recovered Voices series, featuring music stifled by Nazi Germany — are the kinds of exceptionally ambitious projects, broad in scope and resource-intensive, that none but the world’s top companies would dare attempt.

But along the way to this artistic Valhalla, L.A. Opera has busted the credit line at its bank, requiring the $14 million bond-issue lifeline from the county to pacify the company’s primary creditor and permit the shows to go on through at least 2012.

Rountree, a Music Center fixture, who absorbed the top financial spot in his duties at L.A. Opera when the company began to feel a squeeze last year, speaks of lending and spending and financial instruments with a fluidity and frankness uncommon among top arts-organization financial executives. He talks in terms of “low-gap” and “high-gap” operas — those that lose a little money, and those that lose a great deal of money (almost no opera makes money, though some recitals do). 

That’s the issue underlying L.A. Opera’s current financial woes — the balance of repertoire between the high-gap, rarefied productions Domingo loves and the low-gap warhorses that can see the opera through lean times.

“He’s onboard with us — he’s got religion,” Rountree says of Domingo’s state of mind after the bond issue. He adds that the 2010-2011 season, to be announced in late January, will reflect the new financial reality.

Has Domingo “got religion”? 

He may have, but in a statement to L.A. Weekly, he also touted his chancy programming legacy. Asked if he has overreached by producing too many high-gap productions and too few low-gap warhorses, Domingo exhibits the unrepentant bravado of Don Giovanni:

“Not at all,” Domingo says from New York. “We have always done interesting things here; that’s part of our identity.

“Of course, there is always a place for the popular operas that bring in big crowds — I love those operas, too, but we always strive to make those productions special, for example, by putting together an absolutely peerless cast for our recent The Barber of Seville. It is critical to strike that balance between traditional and nontraditional repertoire, and to have a variety of theatrically distinctive presentations. Without that, an opera company quickly becomes uninteresting and pointless.

“These days, we must be especially pragmatic as we look at budgets for future seasons, but I know we can be both fiscally realistic and artistically relevant.”

Rountree originated the county bond issue, which was sold to Bank of America for $14 million. The money is to be repaid to the county by L.A. Opera over the next three years (at a markup of 4.8 percent).

“I saw how the Disney Hall was financed when it was built, through this same kind of bond,” Rountree explains. “We’re doing this with the same kind of instrument, but what’s new here is that this is the first time a bond has been issued for programming rather than a building or construction project.”

L.A. Opera’s primary banking relationship is with Bank of the West, and some of the $14 million raised by the bond issue has already gone to this bank, to pay down the company’s maxed-out credit line. The bond money will also help to finance the coming productions of the four Ring operas.

While Domingo pledges to remain artistically relevant, Rountree beams confidence in L.A. Opera’s ability to raise between $20 million and $22 million a year through fund-raising, which is quite a slicing from the overly optimistic projections of $30 million that it hoped to reel in for 2009.

County Supervisor Zev Yaroslavsky defends the concept of the people of the county of Los Angeles absorbing the risk of floating a county bond that bridges L.A. Opera’s financial difficulties. Yaroslavsky says a “perfect storm” of economic downturn and overoptimistic budgeting, coming while L.A. Opera was producing a highly expensive dream, combined to bring the 24-year-old organization to the brink of financial ruin. 

“The risk of doing nothing would have been the collapse of [L.A.] Opera,” Yaroslavsky says. “The risk of doing nothing was substantial. The risk to the people [in the form of the bond] is de minimis.”

Supervisor Mike Antonovich disagrees with Yaroslavsky on the grounds that the loan was not to help programming in general but specifically to help further the music of Richard Wagner, which Antonovich had previously called “the de facto soundtrack for the Holocaust” in a press release issued in the middle of last year. Antonovich was the sole dissenter on the Board of Supervisors in a 4-to-1 vote to approve the bond.

Antonovich is not the only would-be critic in town skeptical of this Ring. Now that three of the four productions are complete, the public has had a chance to get a good feel for what L.A.’s costly Ring Cycle will ultimately be like. Beyond some political misgivings that most opera fans dismiss as provincial, this Ring is emerging artistically as one of the most highly conceptual and critically contentious ever produced. 

However, not all of L.A.’s cognoscenti are onboard with it, by a long shot.

 “I have seen seven other productions of the Ring. This is the most maddening and in my mind the least successful,” says David Alan Gibb, president of Opera Buffs, a local organization that supports emerging singers, and a board member of Long Beach Opera.

Gibb does not like what he calls the “reductive” quality of the Ring productions to date, and is disappointed in how the characters are often “literally imprisoned in their costumes and unable to relate to each other.”

Noted critic Anthony Tommasini, in his New York Times review, similarly admitted to missing “the human dimension of the characters,” saying of the Ring’s Siegfried, “After a while it was hard not to see Siegfried as ridiculous, like some Blue Meanie character dressed up to perform ‘I Am the Walrus.’ ”

Nonetheless, Gibb also acknowledges that the Ring is “one of the seminal works that every first-rate house has to produce.”

“Is a Ring Cycle that will not be seen as a successful production by some a reason to deny the company a loan? Not in my opinion. The company will move on,” Gibb says.

Also watching what happens in L.A. is the musical community of Washington, D.C., home of the Washington National Opera, also directed by Domingo.

“L.A. operates at a level that D.C. can’t begin to compare to,” says Jens F. Laurson, classical critic-at-large for Washington’s WETA 90.9 FM. Laurson is quick to remind that Domingo, who commands big salaries in L.A. and Washington alike, is a financial asset, as well as an artistic one. 

“Peanuts,” Laurson says of Domingo’s stratospheric income, which adds up to well more than a million dollars a year. “He must be worth that thrice over in fund-raising pull alone.”

Yet concerns that Domingo may have overreached artistically at L.A. Opera continue to resonate in the classical community.

“I do suspect that Domingo must be a bit overextended, given the fact that he runs two companies simultaneously, still sings all over the world and, for better or worse, conducts,” Martin Bernheimer, the renowned Los Angeles Times classical critic, says via e-mail.

Domingo fell ill last May and left a Metropolitan Opera production of Die Walküre in midperformance, only to emerge in Paris to prepare for Cyrano de Bergerac barely a day later.

As for his lofty L.A. Opera salary, far larger than his Washington paycheck, the money resides mostly on paper. He has foregone payment from the company for more than two years now. But L.A. Opera certainly will settle up with him before his contract expires in 2011.

“We can work it all out. Everything is negotiable,” Rountree says with a steely smile.

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