WASHINGTON (AP) — The Kennedy Center announced Thursday it will take over most operations of the Washington National Opera because of the music company’s financial troubles.

Under an affiliation agreement, the opera will remain a separate nonprofit with its own board of trustees. However, the Kennedy Center will take over its business, fundraising and marketing functions. The arrangement beginning July 1 is intended to ensure the opera’s survival after several years of financial shortfalls.

“For me it’s not just a question of stabilizing them,” said Kennedy Center President Michael Kaiser. “One of my goals is to build back their season. They’re down to five operas a year, and we’re hoping to do more in the future.”

Artistic programs will be developed jointly by Kaiser and the opera staff.

One stipulation of the merger, which has been in negotiations since March, was that the opera company transition to the Kennedy Center with no debt and no deficit. Kaiser said much of the opera’s resources would be used to pay off its debts.

Officials at the Kennedy Center and the Washington National Opera declined to discuss the opera’s financial troubles in detail.

In 2009, Opera President Kenneth R. Feinberg said ticket sales and donations had not kept pace with expenses for several years.

According to the company’s most recent tax filing with the IRS for 2009, it carried a debt of about $11.6 million, and its endowment stood at $30.6 million. Feinberg said the endowment will transfer with the company. Feinberg said the company’s operating budget is balanced at about $27 million annually after cutting spending on programming and staff and imposing furloughs in recent years.

Placido Domingo, who has served as the opera’s general director since 2003 and as artistic director since 1996, previously announced he will leave this season. He said in a statement Thursday that he supports the new arrangement.

For years, Domingo divided his time with the Los Angeles Opera where he has renewed his contract as general director.

Kaiser said he has talked informally with Domingo about a continuing role with the opera. The Kennedy Center plans to select an artistic director or adviser to help guide the company.

Joining forces with the city’s largest performing arts center will maintain the opera’s financial stability and artistic quality at a time when its ambitions were no longer affordable with its limited donor base, said Feinberg.

“For 15 years now, I think the Washington National Opera has grown in international stature and reputation,” he said. “The problem, as with most cultural institutions today … is the financial strain that’s placed on the company in doing this.”

The affiliation will be made with the blessing of the opera’s primary benefactor, Betty Brown Casey, who previously resisted such a merger. She and other donors made recent gifts to pay off the opera’s debt and help with the transition, Feinberg said.

The merger is similar to the National Symphony Orchestra, which has been a Kennedy Center affiliate since 1986.

Kaiser said he expects the Kennedy Center will spend some money to help turn around the opera company. There is no set limit, he said, though he expects the cost will be less than $2 million a year. His goal is to build more revenue from ticket sales and donations to cover the opera’s costs.

Kaiser has built a reputation as a turnaround expert for arts organizations. He said strengthening the opera company will be a challenge — but one he will enjoy.

One new possibility is staging some opera productions in smaller theaters at the center, along with productions in the large opera house.

“I think there’s a lot of interesting work you can do in the smaller venues,” Kaiser said. “It’s something that can distinguish the Washington National Opera from other companies.”

(Copyright 2011 by The Associated Press. All Rights Reserved.)


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