Broadway Nonprofits Under Fire: How Subsidized Theaters Turn Public Money Into Private Profit
An insightful essay on Substack examines the collaboration between Broadway nonprofits such as Second Stage, Lincoln Center Theater, and Roundabout Theatre Company and commercial producers for revivals. These partnerships utilize charitable status, tax incentives, and reduced labor costs to attract private investors. Confidential financial documents for The Fantasticks reveal a total capitalization of $3.91 million, with $2.5 million sourced from Second Stage and $1 million from investors, alongside a $1.8 million tax credit from New York State. Investors can receive up to 25.6% of profits after recoupment. Similar funding structures are in place for Ragtime, which has $3.5 million in external capital. The essay critiques nonprofits for favoring revivals over original productions, highlighting Lincoln Center's increased net assets despite ticket revenue being 29% lower than in 2019, raising concerns about the purpose of organizations receiving public funding.
Key facts
- The Fantasticks had a $3.91 million capitalization: $2.5 million from Second Stage, $1 million from commercial investors, and a $1.8 million New York State tax credit.
- Investors in The Fantasticks could receive up to 25.6% of profits post-recoupment, calculated as their $1 million contribution divided by the $3.91 million capitalization.
- Ragtime's recoupment chart showed $3.5 million in outside capital against an $8.1 million capitalization, giving investors a 43.2% share.
- Nonprofit productions using enhancement money employ actors under LORT agreements with a minimum of $2,020 per week, compared to $2,717 under the Approved Production Contract.
- Ragtime's cast of 33 for a 14-week engagement saved $322,000 in salaries, nearly 4% of its $8.1 million capitalization.
- Since 2019, Lincoln Center's net assets rose $4.3 million, Roundabout's rose $23 million, and MTC's rose $16.6 million, while Second Stage's fell $10.1 million.
- Nationally, inflation-adjusted ticket income remains 29% below 2019 levels, and trustee giving fell 28%.
- Lincoln Center Theater's recent mainstage seasons featured revivals: Floyd Collins, Ragtime, A Few Good Men, and The Sound of Music.
Entities
Artists
- Oskar Eustis
- Lear deBessonet
- Zelda Fichandler
- Mac Lowry
- Howard Sherman
- Brett Bernardini
- Will Arbery
- Samuel Hunter
- Rocco Landesman
- Ben Waterhouse
Institutions
- Second Stage Theater
- Lincoln Center Theater
- Roundabout Theatre Company
- Manhattan Theatre Club
- The Fantasticks
- Ragtime
- Signature Theatre
- Playwrights Horizons
- Clubbed Thumb
- HERE Arts Center
- Atlantic Theater Company
- Actors' Equity Association
- New York State
- Empire State Development
- BroadwayWorld
- Substack
Locations
- New York City
- United States
- Broadway
- West 43rd Street
- 9th Avenue
- Bushwick
- Albany
- West Village
- Midtown