Nonprofit theaters across the United States are facing a looming financial crisis as attendance levels remain low and costs continue to rise. The Center Theatre Group in Los Angeles, one of the largest nonprofit theater organizations in the country, recently announced that it would be pausing programming at its smallest theater, the Mark Taper Forum, and laying off 10% of its staff. Similarly, the Public Theater in New York has already cut 19% of its staff and halted its Under the Radar festival. Other well-known nonprofits, such as the Oregon Shakespeare Festival, Lookingglass Theatre Company, and the Brooklyn Academy of Music, have also had to implement cost-cutting measures, layoffs, and large-scale fundraising campaigns. Without a new model for producing theater, nonprofit leaders warn that this may only be the beginning.
The main issue facing these theaters is the fact that attendance has not returned to pre-pandemic levels. This is problematic as theaters rely heavily on single ticket sales as part of their financial model. Additionally, the costs of producing theater have been rising due to inflation and labor shortages. While some theaters have implemented dynamic ticket pricing to increase prices with demand, there is still a desire to provide accessible ticket prices to the community. As a result, ticket prices cannot keep up with rising costs. Some theaters have endowments, but much of that funding has restricted usage, adding to the financial strain.
The financial challenges faced by nonprofit theaters have been exacerbated by the expiration of government funding. Many theaters were able to buffer their costs during the pandemic with grants such as the Shuttered Venue Operators Grant and the Paycheck Protection Program. However, these funds have now run out, leaving theaters struggling to make ends meet. For example, the Center Theatre Group saw a budget gap of $12-13 million in the last fiscal year, which was partially filled with extraordinary funds from the government and other sources. If no changes were made, the theater group was projected to face a similar gap next year.
In the past, the Center Theatre Group had been able to offset some costs at the Taper Forum with revenue from its Ahmanson Theatre, which hosts touring productions. However, ticket sales at the Ahmanson have also taken a hit, and the losses at the Taper next season were projected to be much higher than usual. As a result, the decision was made to pause programming at the Taper Forum.
Related Post
The decline in audience numbers is a concern shared by many theater leaders. Surveys conducted by the Center Theatre Group indicate that attendees are no longer expressing concerns about illness or COVID-19 as they were a year ago. However, there is a broader belief that habits have changed, and people are not engaging in cultural participation in the same way as before.
Critics of the nonprofit theater field argue that these organizations are poorly run and spend too heavily on staffing and executive salaries. However, nonprofit leaders counter that they do a lot with limited resources compared to commercial theaters. Larger theaters have been able to reduce programming and make cuts to mitigate losses, but smaller and mid-sized theaters are struggling and looking to fundraising to survive.
The Oregon Shakespeare Festival, for example, has faced rising costs, supply chain delays, labor shortages, and even cancellations due to wildfire smoke. Although attendance is starting to recover, the theater has launched multiple fundraising campaigns to ensure the completion of its future seasons. They are also looking for ways to cut costs while acknowledging the fixed costs associated with buildings and maintenance.
Nonprofit leaders are exploring various ideas to address the crisis, including seeking a bailout from the federal government. They propose increased funding for the National Endowment for the Arts, which can then be distributed as grants to theaters. The hope is that increased financial support will help these theaters navigate the changed landscape and ensure their survival.
Efforts are also being made in Congress to support nonprofit theaters. The Professional Non-Profit Theater Coalition, consisting of over 100 theaters across the US, was formed during the pandemic to lobby for inclusion in the Shuttered Venue bill. Members of the coalition, including Teresa Coleman Wash from the Bishop Arts Theatre Center in Dallas, have been meeting with lawmakers in Washington, D.C. to build relationships and advocate for the theater industry.
Additional funding is crucial as nonprofit theaters seek to chart a way forward. The Center Theatre Group, for instance, has hired Snehal Desai as its new artistic director in the hopes that his innovative and experimental approach will reinvigorate programming and the organization’s financial model. Other theaters, such as the Pasadena Playhouse, are considering how to sustain their success and continue providing high-quality theater experiences.
In conclusion, nonprofit theaters in the US are facing a financial crisis due to low attendance and rising costs. Many theaters have resorted to cost-cutting measures, layoffs, and fundraising campaigns. The expiration of government funding has only worsened the situation. Nonprofit leaders are calling for increased support from the federal government and are working together to advocate for the theater industry. Finding a new model for producing theater and ensuring accessibility to the community are key challenges that theaters must address to survive the crisis.
