Reports from the Front: Theatre Communications Group
— Teresa Eyring, executive director, Theatre Communications Group
For almost forty years, Theatre Communications Group (TCG) has been committed to conducting research on the American not-for-profit theatre in order to assist individual theatres in the present moment and provide a historic profile of the field and its growth. Theatre Facts 2009, which draws on responses to the TCG Fiscal Survey, compiles information for the fiscal year that theatres completed anytime between October 31, 2008, and September 30, 2009. Written by Zannie Giraud Voss and Glenn B. Voss, with Christopher Shuff and Ilana B. Rose, the report offers a comprehensive analysis of the field’s attendance, performance, and fiscal health during the year that theatres fully absorbed the impact of the recession. It is organized into three sections that offer different perspectives: a broad overview of the field (“The Universe”); a longitudinal analysis of theatres that responded to the survey in each of the past five years (“Trend Theatres”); and a detailed examination and budget group breakdown of theatres that completed the survey in 2009 (“Profiled Theatres”). Theatre Facts 2009 is available at tcg.org/tools/index.cfm, along with the anecdotal reports, The New Normal and The New Normal: One Year Later, and the Taking Your Fiscal Pulse snapshot survey reports.
Theatre Facts 2009 reveals that the economic crisis had a negative impact on the not-for-profit theatre field, just as it did on nearly every sector of society. For most theatres, the economy’s effect on their bottom line was dramatic, with the majority of theatres ending the year in the red, primarily driven by pervasive losses on endowments and other investments, which particularly affected larger theatres. From 2005 to 2009, the percentage of theatres with negative CUNA (the change in unrestricted net assets) went from 39 percent to 60 percent, and over the past two years an increasing percentage of theatres experienced shortfalls greater than 20 percent of operating expenses. Average working capital (the unrestricted resources available to the theatre to meet obligations and day-to-day cash needs), while negative each year, improved annually from 2005 through 2008 and then dropped precipitously in 2009. In 2009, only the smallest theatres managed positive average working capital. However, many theatres in capital campaigns saw substantial growth in investments and improved, new or expanded facilities.
Overall, income decreased 12 percent from 2005 to 2009 and supported 20.3 percent less of total expenses in 2009 than in 2005, the lowest level of expense support during the five-year period. On average, theatres experienced significant capital losses in 2008 and 2009, which fueled a 23 percent decrease in earned income from 2005 to 2009. If investment income is excluded, earned income growth for the period was 0.8 percent above inflation. Overall ticket sales only decreased by 2.2 percent, while “other earned income” — nonticket income from tour contracts/presenting, educational/outreach programs, royalties, concessions, enhancement/coproductions, advertising, rentals, and so on — actually increased by 13.4 percent from 2005 to 2009. Growth in contributed income surpassed inflation over the five-year period despite the poor economy but by only 1 percent, not enough to counterbalance the reduction in earned income. The greatest support throughout the period came from trustees, other individuals, and foundations, while there were double-digit declines in state, local, and corporate support. Responding to the economic crisis, theatres made 1.1 percent overall cuts in 2009. Nonetheless, expense growth for the five-year period outpaced inflation by 9.7 percent, with double-digit increases in most expense categories; only royalty and physical production expenses decreased. During the five-year period, subscriptions declined slightly and single-ticket sales increased. By and large, however, we are hearing a sense of optimism about audiences. Theatres have been fast adopters of new social media opportunities and strategic partnerships to enhance relationships with stakeholders.
In spite of immense challenges, theatres remained committed to their missions and made significant contributions to the well-being of artists, to professional theatre administrators and technicians, to their communities, and to the US economy. The universe of not-for-profit theatres contributed an estimated $1.9 billion to the economy in the form of direct compensation and payment for services and goods. Theatres provided employment to 128,200 artists, administrators, and production personnel. They opened their doors to thirty million patrons and created 187,000 performances of 17,000 productions that enhanced the American theatre legacy.