The following appeared in an article in the Grandview Beacon.
“For many years the city of Grandview has provided annual funding for the Grandview Symphony. Last year, however, private contributions to the symphony increased by 200 percent and attendance at the symphony’s concerts-in-the-park series doubled. The symphony has also announced an increase in ticket prices for next year. Given such developments, some city commissioners argue that the symphony can now be fully self-supporting, and they recommend that funding for the symphony be eliminated from next year’s budget.”
Write a response in which you discuss what questions would need to be answered in order to decide whether the recommendation and the argument on which it is based are reasonable. Be sure to explain how the answers to these questions would help to evaluate the recommendation.
The city of Grandview, Ohio, made a decision in recent years to support the symphony with an annual grant of $150,000, an amount it has enjoyed since its founding in 1932. Now that private contributions have increased dramatically and the symphony has recently doubled its ticket prices, some city commissioners have concluded that the symphony should no longer be supported by the city government.
The decision to eliminate city support for the symphony is premature. The city commissioners need to investigate in detail how the money that the symphony has raised will be used. If, for example, the symphony plans to hire more musicians, then the commissioners should consider the increase the musicians will bring to the community. If, on the other hand, the symphony plans to hire an instructor to teach a violin class at the community center, then the commissioners should consider the increase to the community’s cultural awareness. If the symphony plans to buy a projector and screen to show movies in the park, then the commissioners should consider the increase in cultural awareness, as well as the increase in the entertainment options that will be available for the community. The city commissioners need to examine the symphony’s plans in detail, and they need to consider whether the symphony’s plans are worth supporting.
The commissioners also need to consider a report issued by the symphony that states that the symphony’s finances are stable. In his statement, the director of the symphony quoted the symphony’s 2011 audit report, which stated that the symphony had accumulated a surplus of $2.6 million since 2007. If, as the city commissioners have now decided, the symphony no longer needs to be supported by the city, then the city commissioners should explore whether the city’s management of the symphony’s finances was proper. The commissioners should request a copy of the 2011 audit report and should investigate why the surplus exists. The commissioners should also consider whether the discrepancy between what the symphony’s audit report said and what the city commissioners now believe is true was due to mismanagement, fraud, or some combination of the two. If mismanagement, fraud, or both occurred, then the city commissioners should fire the individuals who were responsible. If the discrepancy is not the result of mismanagement or fraud, then the commissioners should consider whether the symphony’s finances should be more closely examined in the future.
Because the city commissioners need to investigate how the symphony plans to use the money it has raised, they need to invite the symphony director and representatives of the symphony’s board of directors to a meeting. At that meeting, the city councilors should inquire whether the symphony is using the $2.6 million surplus to build up a reserve that will increase the amount of money the symphony can use in the future. If the answer is yes, then the commissioners should not eliminate the symphony’s funding, but they should encourage the symphony to establish a reserve. If the answer is no, then the city councilors should question the executive director of the symphony, and they should demand an explanation.
The city commissioners also need to consider whether the city should contribute to the symphony. Even though the symphony’s attendance has increased, the commissioners should consider whether the symphony needs additional financial support. For example, the commissioners may want to be sure that the symphony uses all the private money it receives to improve the quality of life for everyone in the community. If the commissioners believe that the symphony is not using the private money wisely, then they should ask the symphony to consider reducing the amount it charges for admission and for parking. If the commissioners believe that the symphony’s increased attendance is a sign that the symphony is doing a good job, then they should continue to support it.
The city commissioners should reduce the number of questions they answer before deciding whether to eliminate the symphony’s funding. Instead of eliminating funding for the symphony, the city commissioners should first determine the symphony’s plans for the funds it has raised. Then, they should determine whether the symphony’s plans contribute to the community’s quality of life. Finally, they should determine whether the symphony’s plans need additional money, and if so, what form that money should take.