The AFM Observer

AFM Convention Day 1 Part 7 (bits and pieces)

4:11 PM

Ray introduced Ken Shirk with announcements.

Ken: we've engaged the services of a nurse (who is in the back of a room)

Ray introduced Eddie Bayens, Chair of Law Committee

Eddie told a number of bad jokes, as everyone expected. The Canadian delegation seemed to enjoy them the most. After the jokes, he presented the Standing Rules of the convention. In particular he discussed clause 13, which is a new code of conduct regarding "maintaining an atmosphere free of harassment and discrimination." 

Ray called for discussion; there was none. Rules were adopted by voice vote.

Eddie announced that Law will be considering resolutions and recommendations (didn't catch the numbers, but I'll be there) about an hour after adjournment.

Ray introduced Brad Eggan, chair of Finance. No jokes. Will start 20 minutes after adjournment. Reccs 1, 2, 4, 8, Res 4, 14, 9, 6.

Beth Zare announced the women's caucus meeting. 

Measure and Benefits meeting at 6:30, Reccs 3 and 9

Tammy Kirk, Good and Welfare at 8; Resolution 5 and 7

Tammy Noreko. Org and Leg committee, rec 10 and res 7

Small Locals committee meeting annoucement

John O'Connor, Organizing Committee announced a meeting.

Michael Murray point of personal privilege. Wanted recognition of staffer whose name I didn't catch.

Local 45 delegate; personal privilege, encouraged convention to send their president a get well card.

Chair of PR committee announced meeting.

Eddie Bayens chair Law: committee moves to ratify president's report and formation of various committees and convention hours and schedule. Approved by voice vote.

Credentials committee report by chair. 144 locals, 243 voting delegates, 12 PC delegates.

AFM Convention Day 1 Part 6 (More speeches)

Ray introduced Stefanie Taub, director of the AFM & SAG/AFTRA Intellectual Property Rights Distribution Fund:

described what they do; essentially to distribute money received mostly from SoundExchange but also foreign rights organizations to AFM and SAG/AFTRA artists. Will distribute over $60 million this year to musicians and vocalists.

Encouraged everyone to go to their website; has complete tracklist. Major challenge in gathering information about which performers on which tracks. Please spread the word to members. Encourage officers to make sure that beneficiaries know about the website as well.

Ray said there was one more presenter today. Reminded the delegates that, one hour after adjournment, there is reception in 2935 TEMPO signature members.

Ray introduced Kim Roberts Hedgpeth, executive director of Film Musicians Secondary Markets Fund:

described fund; 501(c)(6) non-profit to collect and distribute residuals for musicians for re-use of material in secondary markets. Technically we're agents of the producers. We try to educate film makers as well, especially young film makers, as well as emerging composers.

Explained how secondary markets work. When something moves from original platform to new secondary platform, a residual is generated. Explained who's covered by Fund.

Provided updates since 2016. FYs 17, 18,and 19, more than 700 new titles reported residuals for first time. More than 2400 new musicians credited for the first time. Starting in 2018, we began sending a portion to AFM-EPF; so far more than $2 million sent to plan.

Part of what we do is auditing companies to make sure what they send us is correct, but also do collection work. We also have a significant challenge holding unclaimed money because we can't find the musician or their beneficiary. We encourage everyone to check out our website and help with this.

Behind the scenes, we've updated our beneficiary policies; they weren't always working as intended. We've put more power in the hands of musicians to determine who they want to receive their residuals after they die. Please encourage your members to update their information on our website. Also we've added 4 new auditing firms to help us accelerate the audits and get more money for musicians. Thirdly, we've embarked on a major redesign of our IT systems. Our infrastructure dates back to the 1970s when it was being managed out of the Pension Fund officers in NY. The time has come for a significant investment in the future, will go live in 2021 we hope. Will help us to expand our collection activities. This investment will benefit both current and future AFM musicians.

The residuals we've collected have continued to grow, this year around $115 million. Sources: DVD revenue has gone done since 2011. Pay TV and free TV have remained constant. Streaming money (product made for traditional media channels going to streaming platforms) has increased dramatically. Without that, income would actually have declined. Will that growth hit a plateau? Will residuals formula for "made for new media" content be changed? Will more new media product be organized by the AFM in the future? How will we audit licencing revenue when product is made for proprietary platforms? Will license fees drop? How many services can consumers afford? What will happen to the economy as a whole?

What's most important is that your union is talking about these issues and getting your membership to act collectively. This money can support working musicians between gigs. I am proud and honored to be a small part of getting that money to your members.

Standing ovation.

AFM Convention Day 1 Part 5 (Actors Equity)

Reconvened at 3:05pm

Ray introduced all the staff and officers on the dais. Lots of people.

Ray introduced Kate Schindle, head of Actors' Equity:

Talked about Equity's first strike in 50 years; learned that employers just regarded us as "pieces on the creative chessboard." More and more commonplace for patrons to fund buildings but not performers.

Seeing a resurgence in union organizing activities among creative professionals; cited new unions at digital news platforms. We've hired new organizers at Equity and are targeting theaters outside the big centers. Reached our first agreement with cruise line. New campaign: "Ask if it's Equity." We believe that working people want to support other working people, and it's our role to educate them in how to do that.

You were the gig economy before the gig economy was a catchphrase. Your history show us there's no reason that those in a gig economy can't be treated better.

A record number of US workers went on strikes or work stoppages last year; highest number since 1986. May be higher this year.

Talked about 802 helping Equity with the Broadway stoke. 802 was the first union to support their strike; will not be forgotten.

We need to work harder to get out the message about our contribution to the economy. Live arts offer jobs that can't be outsourced.

I feel a real sea change among Equity members; they seem less willing to accept the status quo and work for poverty wages while our employers buy buildings and spend millions to renovate them. I know this is a chess game we can win.

Standing ovation.

Ray introduced some more staff (those not sitting on the dais).

 

AFM Convention 2019, Day 1 Part 4 (SAG/AFTRA)

Ray introduced David White, CEO of SAG/AFTRA

Thanks to Ray Hair, John Acosta, all the past and present elected leaders and staff. We work in partnership with your union frequently. Unionizing is not a dying craft; it's coming back. Important that we see those signs. Collective action is the only way we're going to change this industry. But I also want to thank you as musicians; I listen to music all the time. Our whole culture and sense of community is entwined with music. Our brains respond to music in a unique way.

My wife died of brain cancer last year. In my wife's final year and final months, we had music, and our home with filled with music she could remember and sway to. She would be bathed while listening to music. (Absolute dead silence in the room). Thank you for the work you do and the work you protect as unionists.

Does the industry thank you? Do the companies you work for thank you? The language of the industry is money. I'd like to see that thanks in a paycheck, in a contribution to a pension plan. How you get them to thank you is with leverage. That's hard when dealing with the largest enterprises in human history. Companies can now give as much money as they want to politicians, and they're attempting to dismantle unions every single day.

So where is collective action? The strongest source is still unions. The future of musicians lies in no small part in the people in this room. Our job is not to kill each other; our job is to work it out and keep moving forward. Your focus on entertainment companies strifes me as the right focus.

In November, everyone in the house of Disney, along with Lucas Films, Marvel, Pixar, all of Fox's TV and film assets, are all going up on a a Disney platform exclusively called Disney+. ATT just bought Time Warner and will come out with their platform. There will be walled gardens and will all ask us for monthly payments. So Netflix is creating new content; they were scheduled to spent $7 billion in new content. They actually spent over $14 billion. Their cashflow is negative; they're buying market share. Apple doesn't have a library; they're going to start making content. That's a lot of content. So getting more money and more pension money from them strikes me as a good plan.

You're not alone. We work with you and other unions. We must support each other. 

Your fight is the right fight. In the past seven years, we've made progress in areas I thought we couldn't.  We need to reinvigorate the faith that unions matters. They want us to think that all is lost. It isn't. They want you to think we can't do anything about tit. But we can. You can't allow your legacy to cloud your belief that you have power. 

Lunch break began at 2:05PM

 

AFM Convention 2019 Day 1, Part 3 (SoundExchange)

Ray introduced Mike Huppy from SoundExchange.

Respecting the Band in the Streaming Economy: Streaming makes up 74% of recording revenue in the US. Old model was about driving sales; now the revenue is from listening and not sales. 

( I'm not able to keep up with his presentation, but it is interesting. Probably worth seeing if his Powerpoint is on the SoundExchange website. Giving up now).

 

AFM Convention Day 1, Part 2 (Chicago strikes)

12:50 PM

Ray asked the Chicago delegation to  join him at the podium; talked about the two strikes there (Lyric and CSO). Introduced the chair of the Lyric committee, Matt Comerford, and several 10-208 officers.

Matt Comerford: 10-218 offices are where the Haymarket Square massacre happened. A rally for the 8-hour work day which was attacked. In 2018, both Lyric opera musicians and CSO musicians were engaged in negotiations with the same lawyer representing both employers. At Lyric, we expected demands for concessions, but nothing like what was really proposed. They wanted a massive pay cut (up to 43%, cutting 8 weeks of work and all paid ready broadcasts.) Anything about that would be per-service, but we had to guarantee our availability. Wanted to cut 8 musicians from orchestra, eliminating hard, tuba and piccolo. Drastic cuts to health insurance. They wanted to cut our broadcasts, which were doing very well in terms of listenership. Management wanted to rent the building to the Joffrey Ballet, eliminating opera weeks to do so. Management wanted to eliminate the orchestra as the house orchestra. And they negotiated this deal with Joffrey with no input from us.

From April 2018 until early October, management didn't budge. On October 5, we voted unanimously to strike.We got massive support form the public, even from the police assigned to monitor our picketing. Most important support was from other unions. On October 12, we held a massive rally. Ray flew in at a moment's notice to speak, which was very much appreciated by the orchestra.

That day, we met with management. They told us that, if we continued to strike, they would cancel the season and declare bankruptcy, even though they had increased the budget massively and the proportion of it going to musicians cost dropped. Ticket revenue has increased; they've had enough money for years, balancing their budgets for 30 years with one exception. We concluded that management simply wanted to change the mission of Lyric from grand opera to being a profitable enterprise. 

We ended up losing 2 weeks, but did get an increase in weekly scale, so a net 5% loss in annual income. Included a guarantee of 5 weeks in one season for Ring cycle. Lose of 4 positions. Increase in pay for extra employment for spring musical. No change in health care. In the end, it was a compromise. The positive takeaway for us was that we are more united than ever before, and more committed to reaching out to the board and the public. Our younger members are energized and committed to unionism.

Standing ovation.

Terry Jares: I'm here to speak for Steve Lester, chair of the CSO committee, who couldn't come this week. Management wanted to make this all about freezing the orchestra's defined benefit plan and replace with defined contribution plan. It became a philosophical issue. We proposed a Sustained Income Plan from Milliman, but both sides ended up rejecting it. Talked about strike activities. We proposed a DB freeze and a fair DC plan. Outgoing Mayor Rahm Emmanuel chose to step in. He has very limited patience. He wanted a deal done that day before he left at 4:30. The Mayor made his final proposal for an agreement at 4:00. 5-year contract, guarantee for 20 years of 7% contribution to DC. 13% increase in wages over 5 years.

Another standing ovation.

AFM Convention 2019 - Day 1 Part 1 (Ray's speech)

Day One is usually Talking Heads Day, and this is not going to be an exception.

President Ray Hair called the proceedings to order almost exactly on time - 11:01 AM MDT.

National Anthems were played and sung. An invocation was given by a gentleman who is, I think I heard, an officer with the Las Vegas local. The president of the Local welcomed the delegates to Las Vegas.

Ray asked the delegates to stand for a moment of silence in honor of former AFM president Steve Young, who died unexpectedly last year.

Ray gave his address.

He talked about the first AFM Convention in Indianapolis in 1896, and the continuity of mission from then until now.

Ray discussed the recent relocation of AFM headquarters in New York (from the 6th floor to the 9th floor of 1501 Broadway). He described it as relatively smooth and efficient. He praised the work of S/T Jay Blumenthal in making it all happen. Described the process; the AFM had made a deal to purchase space near the World Trade Center, which was all set to happen until the owners made it a requirement that the AFM purchase two floors rather than one. Given the limited amount of time (since the existing space had already be let to a new tenant), the IEB chose to lease again. (From Jay Blumenthal's remarks at the Midstates Conference meeting yesterday, cost to move and remodel was a little more than $2 million).

Ray talked about the officer training program. He praised the AFM staff as "indispensable." He said that turnover has been low since 2010.

He described the state of the AFM when the current administration took over as "dire." He said it took five years to finalize all the open negotiations. He said that the current stance of the AFM in negotiations is "very aggressive," especially in terms of streaming media. He said that the AFM was no longer at war with the player conferences or the members  in negotiations. He said that the AFM had sued every major Hollywood studio over the past 3 years for unpaid use of material. The AFM has collected more than $2 million in settlements for contract violations in the last three years. He talked about a lawsuit against Paramount and MGM about outsourcing to overseas of scoring work, which resulted in a "landmark" victor in the 9th Circuit. He thanked General Counsel Emeritus Jeff Freund and Bredhoff & Kaisier for that.

He described lawsuits by the AFM-EPF against signatories that led to new agreements that will lead to $20 million additional income to the Fund from streaming, as well as additional money to MPTF. Label streaming revenue has led to a revival of MPTF. Ray described that as a goal that had led him to run for AFM president.

Ray thanked the film and recording musicians for their support of these negotiations, which have led to 1.5% of special payments income going directly to the AFM-EP Fund. He talked about how Youtube was using material from our members without payment to our members, even though Youtube was earning advertising income from that material. He talked about disruption in the online distribution business. "Producers are using streaming to turn good jobs into bad jobs." Even the stage hands are getting streaming income from these new channels; we're not. Studios and distribution channels are making massive amounts of money. Digital Media Association is trade association for the major digital companies (Apple, Amazon, Google, etc.) Total digital income was over %600 billion last year; this year expected to be $1 trillion. 

There's a place for all members and all locals in this new campaign for our fair share of streaming media revenue. The IEB has committed "adequate" resources to this campaign.

Ray talked about events in Canada; new agreement with CBC with new residual payments, which means no more unfair advantage to doing work in Canada to avoid other AFM agreements. Talked about new symphonic Integrated Media Agreement; thanked ICSOM and ROPA officers for their help, with new provisions regarding streaming.

Ray talked about organizing department and their staff; chartering a new local in Boise Idaho because of organization work with Boise Philharmonic.

Talked about lobbying efforts in DC; thanked Alphonso Pollard and the DC local for their work. Working on changing tax law to bring back deductions for musician employees that were eliminated in Trump tax act, supporting the NEA and public broadcasting. Convinced Senator Sherrod Brown to name AFM-EPF as beneficiary of the Butch Lewis Act.

Ray introduced Dave Pomeroy, who sang the song he wrote for a rally in support of the Butch Lewis Act. Good song; standing ovation.

Ray talked about the Baltimore lockout; said that Mary Plaine can't be here from the Baltimore local because of the lockout.

Talked about TEMPO fund; we need more money to work with the other unions to get a better Congress.

Talked about the healthy financial state of the AFM; nine years of stability. Talked about having been an AFM officer for 36 years; local officer, IEB member, and AFM president. Talked about San Juan Hilton NLRB court decision, which was devastating to the AFM. He talked about his first convention in 1983 in Phoenix. We had 250,000 members. I began to see the adverse consequences of that court decision, making freelancers independent contractors rather than employees of the venue. Freelancers were thus excluded from the benefits of labor law. The real employer, the venue or purchaser, could not be held liable to bargain with the union. The AFM could no longer insist that its licensed bookers could only use union members. The bookers had been our organizers; now they were disorganizers.

We lost 85,000 members from 1978 to 1983, mostly freelancers who left because of that settlement.

He talked about a class action lawsuit by members against the AFM-EFF in 1985, claiming the the Fund was accepting contributions from independent contractors. Talked about other divisive conventions with difficult issues and infighting. In 2010 we chose unity over divisiveness.

He said the attacks over the pension fund issues have really hurt personally. I never thought that the folks I worked so hard for; that I'd have to tell them that something bad was going to happen. We all still suffer from two dirty words: "independent contractor." 

Talked about the pension fund. Fund is now in critical and declining status; fund is projected to run out of money in 20 years, trustees chose to apply to benefit reductions to the Department of Treasury. All the musician trustees are here to talk to you about this. We appointed Brad Eggen as retiree representative, who has put together an advisory group to help him. They are here this week as well.

Fund's problems stem primarily from the following; tax laws  required funds to increase benefits when assets increased. Second we lost $900 million in the 2008/09 crash. The aging of the plan's participant pool. And we have not established increasing employer contributions.

The Fund's problems have not stemmed from a lack of expertise. Resolution 8 is no solution. We can do nothing, which leads to the Fund going broke, or we can reduce benefits for some participants. There will be no government back stop if the Fund runs out of money; the Pension Benefit Guaranty Corporation is also going to run out of money.

60% of current beneficiaries will be protected due to age or low benefits. Current plan is to reduce all the past multipliers except for the $1 per $100 multiplier. All participants will get advance notice of their individual reduction.

You have not lived as a union rep until you've gone into a union meting and been castigated by folks who've just come from dark dates and scabbing on our pension plan. Sometimes our members are the most effective union busters. This is real personal to me; I never really left the gig. We will become what we negotiate. We make the music the world wants to hear. There is plenty of money out there; divided, we'll never get it. Working together, we can.

Ray got a little emotional at the end, talking about unionism. He ended at 12:45 PM.