We’ve all listened to our grandparents tell us how difficult they had it growing up—you know, how they had to walk five miles to school uphill both ways in freezing temperatures, and that us young whippersnappers wouldn’t be able to cut it. Perhaps it is natural to think that we pave the way for those to follow, and I’m sure that by the time I am as aged as the “greatest generation,” I too will think that those that follow have it easier.
In many ways, the trailblazers of the regional theatre movement really did have it harder that we do. The field is much more established than it was even a couple of decades ago, with leaders who spend years of post-graduate study specializing in theatre management. Still, I find myself wondering: In the quest for financial stabilization, have we sacrificed some of our ability to create epic, boundary-defining new theatre?
As a gay theatre manager who came of age in the 1990s, perhaps there wasn’t a more defining play in my development, both professionally and personally, than Tony Kushner’s Angels in America. Though it’s celebrating the 25th anniversary of its Broadway debut and its winning the Pulitzer Prize for Drama with a much anticipated Broadway revival, I often wonder how many of our regional theatres today would greenlight a six-hour-plus, 20-character new play in two parts, described as a “gay fantasia on national themes,” immediately following the height of the AIDS crisis, by a then relatively unknown up-and-coming playwright? As much as I would like to say that Kushner’s masterpiece is as likely to get produced today as it was almost three decades ago, the shifts in the nonprofit business that have occurred since that time make that claim hard to justify.
The economic climate in the early 1990s wasn’t all puppies and roses. According to Theatre Communications Group’s Theatre Facts 1993, the country was beginning to emerge from a recession that took quite the toll on the health of our regional theatres, with 21 theatres ceasing operations that year alone. Foreshadowing challenges yet to come, Theatre Facts highlighted a rare occurrence in 1993: Subscription revenue only increased by 1.4 perent, far lower than inflation, while single ticket revenue rose 6.2 percent. That was an early red flag. While subscription revenue had grown 18 percent over the previous five-year period, there was a telling note: Theatre Facts noted “a shift in purchasing patterns that began several years ago that continued in 1993, with single-ticket income growing at a much faster rate than subscription income for a second year in a row. Theatres across the country are reporting high renewal rates each season, but an increasingly difficult market for acquiring new subscribers.”
The concern was clearly articulated a few paragraphs later: “Most theatres believe that the subscription audience, which still fills roughly half the seats at the average sample theatre, remains critical if nonprofit theatres are to avoid falling prey to market-driven programming that might not be consistent with their missions as tax-exempt institutions.”
When the Mark Taper Forum staged the world premiere of both parts of Angels in America in 1992, subscription revenue was 27 percent of the average theatre’s expense budget. Today it is less than 14 percent, a drop of 50 percent; it has steadily fallen year over year for the past five years. The argument can be made that the loss of renewable subscription revenue for a majority of theatres nationwide has, as predicted, led to a reality where market forces influence programming more than ever, making some theatres more risk-averse and less willing to take a gamble.
Coupled with the reality of lagging subscription revenue, as I noted in my previous article on “Safe Programming,” the field has yet to fully recover from the 2008-09 global economic crisis. The most recent TCG Theatre Facts report shows that total attendance has decreased, while every category of expenditure was higher in inflation-adjusted dollars over time, working capital was negative in every year from 2011 to 2015, and growth in cash reserves lagged inflation by 26 percent. Often the development of a large-scale new work takes years of investment by the theatre, the playwright, and the artistic team involved. With a lack of working capital and theatres facing cash-flow concerns, do more than a handful of very well capitalized theatres have the funds to invest in a major development project, knowing that any return on that investment if realized would be years away? If managers are concerned about keeping the lights on and making payroll, they’re unlikely to have the time to raise their gaze to look at long-range opportunities.
Further, an obscure note in the 1993 Theatre Facts also flags a concern that would only intensify for many theatres in the years since: “Of the 67 sample theatres, 13 received contributions from united arts funds. Total income from these funds fell 9.2 percent in 1993, owing entirely to the drop in the Mark Taper Forum’s allocation from the Los Angeles Music Center’s United Fund, which registered a major decline in total giving. In addition to the Mark Taper Forum, significant united arts fund support was received by the Alliance Theatre Company, Actors Theatre of Louisville, Cincinnati Playhouse in the Park, and Milwaukee Repertory Theater.”
While I haven’t crunched the data on the loss of large, non-designated operating grants to regional theatres, my experience from the past 15 years at LORT theatres tells me that these grants are also on the decline, while by far the largest growth area in contributed funds come from individual donors. Not meaning to look gift horses in the mouth, while I am incredibly grateful for support provided from individual donors, this trend has led to a larger volatility risk and a growing tendency to restrict funding to specific donor-advised projects.
In the early 1990s, arguably there wasn’t a more controversial and politically divisive issue than the AIDs crisis and the government’s lack of response to an epidemic that was viewed by many as primarily a “cancer” confined to the gay community. Clearly Angels in America wasn’t afraid to address this issue, making it and the theatres that produced a target for controversy. Would some theatres be willing to take a similar risk today, knowing that if the endeavor upset a handful of major individual donors it could collapse their business models? How many brilliant projects, I wonder, are shelved each year for fear that critical funding sources would dry up?
Relatedly, younger donors are becoming much more project-based in their funding, and are restricting funds to certain activities, requiring theatres to use more of their available working capital to cover day-to-day operational costs and leaving less to invest in long-term play development.
Naturally, changes in the economic landscape, cultural philanthropy, and purchasing behaviors of patrons have caused theatres to look for other means of sustaining and renewable revenue. One of the more important and growing areas of additional revenue comes from enhancement funds provided by commercial producers to regional theatres to aid in the development of primarily Broadway-bound productions. In the age of Angels in America, commercial enhancement money was virtually non-existent, but in looking at the most recent Theatre Facts, for TCG Group 6 theatres (theatres with the largest budgets), on average enhancement funds represent 2.4 percent of theatres’ total budgets, representing anywhere from $250,000 to north of $2 million. Combined with the need to be more responsive to market-driven forces given the growing importance of single tickets, the need for the largest theatres to secure enhancement monies also makes them more commercially focused.
Don’t get me wrong—I don’t mean to imply this is universally a bad thing, as in my career I certainly have worked on my fair share of mission-driven commercial transfers. But there is a clear preference toward musicals on the Great White Way. How many new plays without a star-driven cast can you name that landed in New York commercial venues in the last five years? Depending upon how a regional theatre is capitalized, the business model of many can look much more like for-profit enterprises than the originally intended nonprofit organizations.
When I was at Arena Stage, one of the great privileges of my career was developing a friendship with theatre founder Zelda Fichandler. I remember early on, I was discussing with her the role of commercial productions, and I mentioned offhand how proud she must have been when Arena Stage became the first regional theatre to transfer a show to Broadway with the Great White Hope. I remember her shooting me a look that could kill, saying it was the worst thing that happened to her and the theatre, as many of Arena Stage’s actors went with the production to New York, thereby imploding the resident acting company. She had helped found a regional theatre movement that was supposed to be immune from the commercial pressures of Broadway in an attempt to create groundbreaking work that New York, tied to its return on investment model, could not.
Zelda was once quoted as saying, “Once we made the choice to produce our plays, not to recoup an investment, but to recoup some corner of the universe for our understanding and enlargement, we entered into the same world as the university, the library, the museum, the church, and became, like them, an instrument of civilization. So we’re not nonprofit, we’re just economically nonprofit. But in all the other riches of civilization and all the other endeavors that fulfill people’s needs, we show immeasurable profit, because we help people to see themselves and the world they live in.” It is this belief and aim that made an undertaking like Angels in America possible, not the market-driven economies that are reshaping some of our regional theatres.
All that said, at the risk of being accused of looking at the glass half empty, there are reasons to be hopeful about the future. At Milwaukee Rep, we’ve recently completed a $10 million capital campaign that wasn’t focused on physical infrastructure but on programming, building multi-million dollar funds for new-play development and community engagement while growing our endowment and cash reserves so that we have a decades of high level of working capital. This makes it much more possible to make mission-driven rather than capital-driven investments. As a model I look to the work of artistic director Bill Rauch, who recently announced his departure from Oregon Shakespeare Festival, and at that company’s success in developing large-scale new works, such as the two-part All the Way and The Great Society. I love setting audacious goals, like Arena Stage’s new Power Plays Initiative, which will develop 25 new plays over 10 years from leading American dramatists about the people and events which have helped shape our nation.
So maybe environmental factors are more challenging today than they were when Angels first surfaced, and perhaps those factors provide significant headwinds against the development of large-scale and epic new works for the field. But I’m hopeful that if we keep our missions as our true north, the ingenuity and resourcefulness of the field will lead to decades more of work that will entertain, provoke, and inspire generations to come.
Chad Bauman is the managing director of Milwaukee Repertory Theatre.
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