Orchestra management has been negotiating with musicians over a new contract since November, according to the paper. The current contract doesn't expire until August 31, but officials insisted that they needed to complete the talks by December 31 in order to launch a crucial fundraising effort. After that deadline passed with the two sides still far apart, management withdrew its most recent offer and hired a bankruptcy lawyer.

The orchestra nearly declared bankruptcy in 2003 before reaching a last-minute deal with musicians. But deficits have continued: this season's shortfall is expected to be $500,000, despite a $350,000 grant from the regional Cultural Blueprint program.

According to the Courier-Journal, the orchestra's board will consider whether to declare bankruptcy at a meeting on January 30.

On its web site, the orchestra said that it would take "all reasonable steps" to continue performing. But should concerts be canceled, ticket holders will not receive refunds. An official told the Courier-Journal that concerts late in the season were most likely to be canceled, so patrons should consider exchanging their tickets for concerts in the next two months.

The site also said that the orchestra would continue searching for a new music director "as long as concerts continue to be produced." The orchestra is auditioning candidates this season to replace Uriel Segal, who left in 2004 after his contract was not renewed.

The demise of the Lousiville Orchestra could also affect the Kentucky Opera and Kentucky Ballet, which make use of the orchestra's musicians. But musicians said that they would play all scheduled opera and ballet performances this season whether or not the orchestra shuts down.