Nearly 60% of Nonprofit Theaters Operated in the Red Over Last Three Years

The number of nonprofit theaters that are losing money has increased by nearly 30 percent over the past three

years, according to an annual survey by the Theatre Communications Group, in New York.

The study was based on data from informational tax forms that nearly 1,300 theaters submitted to the Internal Revenue Service. Nearly 58 percent of those theaters lost money in the past three years, in large part, the Theatre Communications Group said, because of economic troubles that intensified after the September 11, 2001, terrorist attacks.

The survey results indicate that the number of nonprofit theater productions in the nation continues to grow despite the economic difficulties faced by theaters.

A sample group of 125 theaters that provided information to the Theatre Communications Group from 1999 to 2003 reported that their productions had increased by nearly 15 percent, from 1,598 to 1,829, over those years, and that their income from ticket sales and other sources had increased by nearly $60-million at the same time.

A look at a group of 85 theaters that provided more-detailed data over those years showed that contributions from individuals, a major source of support for nonprofit theaters, gained a total of 70 percent from 1999 to 2003. That comes even as donations from individuals dropped by almost 22 percent last year.

The decline in donations from individuals is a particularly nettlesome problem for small theaters. Those with budgets of less than $250,000, according to figures from their 990 forms, derive 61 percent of their income from donations, with the rest of their money coming from ticket sales and other sources.

Theater Employees

Looking at the 214 theaters that completed the Theatre Communications Group’s 2003 survey, the report found that theaters regularly borrow to meet their daily operating needs, with 55 percent of their budget being taken up by payroll. Of the approximately 104,000 people working for theaters, 61 percent spend all of their time on creative duties, 13 percent are involved in administrative work, and 26 percent are technical personnel.

Free copies of the report are available on the Theatre Communications Group’s Web site at http://www.tcg.org. Print copies, which cost $6 each, can be ordered by calling the organization’s customer-service department at (212) 609-5900.

NONPROFIT THEATERS: A STATISTICAL PROFILE

2003 totals for 1,274 theaters Productivity Attendance 34,300,000 Subscribers 1,900,000 Performances 170,000 Productions 13,000 Finances Earnings $787,000,000 Contributions $694,000,000 Total income $1,481,000,000 Total expenses $1,476,000,000 Net surplus $5,000,000 Paid employees Artistic 63,000 Administrative 14,000 Technical 27,000 Total 104,000

Sources of income as a percentage of expenses, for 214 theaters Earnings Single ticket sales 25% Subscriptions 20% Other earnings 11% Investments 4% Contributions United arts funds 1% Federal 1% State 2% In-kind donations 3% City and county 3% Fund-raising events and guilds 4% Trustees 4% Corporations 6% Foundations 8% Other individuals 10% Other contributions 1% Note: Percentages exceed 100 percent because income exceeded expenses.

SOURCE: Theatre Communications Group