The Playgoer: Too Big to Succeed?

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Wednesday, February 03, 2010

Too Big to Succeed?

Many of us rail against the functionality of the nonprofit business model in the theatre, but seasoned arts administrator James Undercofler has a nice provocative post providing an actual reasoned argument:

Is the traditional not-for-profit, 501(c)3 (NFP) so cumbersome in its structure as to actually impede the very promise of its original intention?
In the arts world, an odd personalization of the NFP has evolved that has accelerated their growth in numbers.  Creative artists from all areas want to create their own organization, so that they can create their art.  It's almost as if one step has to precede the other.  Yes, it likely grew out of the need to raise money, and a somewhat unfounded belief that no one would give to them without the imprimatur, but back to my initial premise, the creation of an organization before the art itself proves my point, that the NFP impedes its very promise.

While at the start-up level the NFP structure presents a visceral challenge, as organizations grow larger, the effects of the structure are more subtle, more insidious.  In larger NFP's, because of the need to raise larger budget percentages of contributed revenue, boards of directors become exceedlying large, as does the administration needed to service them.  These boards rarely universally possess knowledge of or passion for the mission itself.  At the very least they may understand a small portion of the mission's program activity.  With these large organizational entities, flexibility is lost, and mature organizations quickly move into decline, as they cannot address the changes presented to them in their communities, from their audiences, and external factors.  These organizations become "too big to succeed."
Hmm, remind you of any certain large but inert nonprofit theatre companies?

Indeed the whole 501(c)3 was created to help "charities" not art, right?  (Insert "art as charity case" joke here.)  So, not that this is a time to get anything changed in Congress, but...  how about a new tax code just focused on accomplishing what artists need most: the ability to attract donations and rent discounted space in exchange for not personally profiting.  That would be a start, at least.


RLewis said...

'Indeed the whole 501(c)3 was created to help "charities" not art, right?'

Not sure if that's completely correct. I mean, it is correct, but I'm not aware that theater is considered "charities". At least, I hope not. lol.

"Corporations, and any community chest, fund, or foundation, organized and operated exclusively for religious, charitable, scientific, testing for public safety, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals,..."

My understanding is that theater comes under "educational", so it alters your suggestion in the sense that going from what it is to what you suggest it should become is a more skewed leap.

Playgoer said...

Good point, Ralph. Thanks for the correction--indeed I assumed too hastily.

Let me broaden my point then to say that the 501(c)3 appears to have been originally intended for, shall we say, basically "do-gooders." (charity, churches and schools).

And we all know, theatre don't do nobody no good. At least, when it's good.

C.L.J. said...

As noted, most theatres qualify by having an educational component (theatre classes) or by maintaining an outreach program (taking plays to schools or community centers, for example). The program has to be clearly defined in your organization's mission statement; you can't just say "hey, we sell tickets to schools, too!" You have to have a mechanism to ensure the program achieves its goal. Maybe it's busing underprivileged kids in for a free performance; or going to a senior center to teach improv.

And this is within the original intend of the organizational definition for this kind of corporation.