Progress without Profit: Break a leg, not the bank

I think of myself as a theatre kid who can’t sing, dance or act. In spite of my lack of talent, growing up, I was privileged enough to immerse myself in theatre. I lived vicariously through my sister’s high school plays and my mom’s college stories as a theatre major. Every birthday or holiday wish list always included tickets to shows.

However, my love for theatre isn’t quite enough to keep them successfully running. Following the 2008 recession, theaters received less government and corporate funding, turning toward the earned income model that depends on ticket sales and subscriptions. In fact, the 2019 Theatre Facts report found that, on average, theaters had to earn more than half of their budget. 

Unsurprisingly, this model dealt massive blows to theaters during the pandemic when no one could attend shows. Gary Grossman, the artistic director of the Skylight Theater Company in Los Angeles, said it will take three to five years for his theater to get back financially to where it was prepandemic. 

Coronavirus exacerbated an already growing problem: Nonprofit theaters cannot rely on earned income while maintaining general accessibility. Instead, they need government support and a society that values the broader cultural and community benefits of these organizations. 

According to the New York Times, in 2019, an average ticket on Broadway, home to for-profit theaters, costs $124. In comparison, in 2018, Second Stage, a nonprofit theater also in New York, offered subscription packages for three shows at an average ticket price of $83.33 per show. Even now, a glance at their website shows tickets ranging from $69 to $125 for the show “To My Girls” and $79 to $199 for “Take Me Out.” While most often less expensive than Broadway, these shows still come with a large price tag, limiting who attends. 

As organizations with tax-exempt status, nonprofit theaters should contribute to the community and make art more affordable for everyone. Yet, using tickets and subscriptions to stay afloat leads to an increase in prices. SMU DataArts reports that the more seats performing arts organizations fill with subscribers, the less racial and income diversity of the audience. During the 2018 to 2019 season, Broadway audiences were 74% white, with an average annual household income of $261,000 and an average age of 42.3 years old. A for-profit theater seeks to turn a profit for shareholders — which does not incentivize accessibility. So, where the for-profit sector fails, the nonprofit has a chance to bring art to communities who otherwise could not afford it. 

In Boston, the nonprofit theater group Company One prices tickets at about $20, with two-thirds of the audience receiving tickets through a “pay what you want” system. It found that 40% of its audience identified as Black, Indigenous, and people of color compared to 11% of audiences in the rest of Boston. Additionally, 55% of its audience is under 35 years old compared to 25% throughout the rest of the city. How does Company One do this? Since it focuses on government support, earned income makes up only 20% of its budget, allowing them to slash ticket prices. 

In 2020, California passed AB5, mandating that all theaters pay minimum wage, plus payroll taxes, workers’ compensation and unemployment insurance to their staff and artists. For context, Martha Demson, the board president of the Theatrical Producers League of L.A., said the law will add $193,500 in labor costs to Open First Theater Company’s usual budget of around $200,000 to $250,000. 

Taylor Gilbert, founder of Road Theater Company, perfectly summarizes the conundrum: While theaters support paying their artists a living wage, many fear they do not have the budget to implement it. To be clear, I fully support paying and protecting people who work in theatre. But, at this point, nonprofit theaters cannot be fully accessible and fairly compensate workers on their own. That’s where the government comes in. 

After theater companies successfully campaigned, Governor Gavin Newsom signed a one-time $50 million subsidy to financially assist nonprofit theaters smaller than 99 seats last July. As California ranked 28th in state arts funding on a per capita basis before the pandemic, this subsidy is a great start. However, theaters need continued support from the government. 

Theatre communities are now advocating for SB 1116, or The Performing Arts Equitable Payroll Fund. Advocates say that the bill creates a grant program to “support California performing workers directly” by paying for some of the new payroll expenses incurred by AB5. The bill would provide the greatest support to the smallest organizations, helping theaters remain accessible while also paying a living wage. 

While there could be hesitation to contributing tax-dollars to theatre, this mindset fails to understand its inherent value. Theatre brings new perspectives and experiences to the stage, highlighting community and creativity while tying the audience together in a singular, unique experience.

There’s no way for me to fully describe watching the curtains slowly open at the start of a show, driving around my neighborhood belting musicals with my sister and stifling tears in the darkness of a playhouse during an emotional scene. Theatre is an artform that everyone who wishes to, regardless of the size of their wallet, should be able to experience. 

Sophie Roppe is a senior writing about nonprofit organizations and social justice. Her column, “Progress Without Profit,” runs every other Monday.