Board chair John Arnoldy said that the company had not engaged in "imprudent spending," but that earned income and contributions were significantly lower than expected. The shortfall was attributable, he said, to the eight-month gap between the departure of former general director David Gockley and the arrival of his successor, Anthony Freud; "unrealistic" goals for ticket sales; the loss of three staff members devoted to fundraising; and the degree to which local philanthropists were focused on Hurricane Katrina relief.

Also at the meeting, newly installed general director Anthony Freud laid out a five-year business plan that includes increased fundraising and spending. The company's budget has remained at approximately $20 million for the last several years, Freud pointed out.

"HGO's reputation and that of the city which it serves have grown enormously over the last decades," he said. "Maintaining the status quo is never an option for a performing arts organization; it must always choose between development and decline."

As part of intensive marketing efforts designed to increase income, the company will revive its quarterly Opera Cues magazine, which was eliminated a year ago in order to save money.