"Producer's Corner"
by Bruce Lazarus

The Role of the General Manager, Part II
The New Kid in Town Makes Good:
Budgets for Broadway Alliance Productions
And How They Compare to Broadway and Off-Broadway

        Tuesday nights I host a free TeleCourse in which I invite
different theatre-industry professionals to discuss various aspects of the
theatrical production process with both experienced and novice producers.

 Recently our guest was Roger Gindi, my partner producer of the
current off-Broadway play Shakespeare’s R&J, and general manager of such
Broadway and off-Broadway shows as Oleanna and Nunsense and the Broadway
Alliance production of Our Country’s Good.  In the last article, I discussed
how Roger and other general managers go about putting together a
Production Budget (what it will cost to get a show from concept to half hour
before the first performance) and an Weekly Operating Budget (what it will
cost to run a show on a weekly basis).

 Roger also discussed the differences between budgets for a Broadway
show, an off-Broadway show, and a third and relatively new kind of
production, the Broadway Alliance production.

 The Broadway Alliance was created in 1990 by the League of American
Theatres and Producers; the three major Broadway theatre operators, Shubert,
Jujamcyn, and Nederlander Theatres; and the performing and theatrical unions,
agreeing to cut salaries and fees to encourage more non-musical play
production on Broadway.  At that time, Roger explained, plays like Steel
Magnolias, Frankie and Johnny in the Claire de Lune, and Driving Miss Daisy were
big hits off Broadway.  They began to take on lives of their own that
Broadway plays took on in an earlier time, gaining national recognition and
being made into feature films with major stars like Julia Roberts, Sally
Field, Michelle Pfeiffer, Al Pacino and Morgan Freeman. Suddenly, both movie
stars looking for projects and audiences from outside Manhattan were going
off the beaten path to see theatre.  So, labor, management, and creative
theatre artists came together with a creative solution to stimulate the
production of non-musical plays on for Broadway, and make tickets more
affordable (the equivalent of the top price off Broadway: in 1990, the top
ticket price for a Broadway Alliance show was $37.50, but now a top ticket
price may be set at up to $50.00).  In 1990, 4 New York City theaters - the
Belasco, the Nederlander, the Walter Kerr, and the Lyceum - were designated
for Broadway Alliance productions.  There are now eleven theaters that
may house these productions.  The additional 7 are the Ambassador, the
Brooks Atkinson, the Cort, the Golden, the Longacre, the Eugene O’Neill and
the Neil Simon.

 The Broadway Alliance calls for a limit on the production budget of
$850,000.  When he or she is drawing up the budgets for a Broadway Alliance
production, the general manager has to work within that figure. Even funds set
aside specifically as a “reserve” must be included in the $850,000.  All of
the 14 major theatrical unions, as well as theatre operators, producers
and suppliers, agreed to take salary, royalty, or manpower concessions
for plays produced under a Broadway Alliance contract, and a general
manager must take all of this into consideration as well when developing
budgets for a Broadway Alliance production.  At this point in time, most
union members are paid 75% of union minimum salary (“scale”) on a Broadway
Alliance show, although the situation can vary from union to union.  An
Actor’s Equity member may receive anywhere from 75% of scale to $3,500 a week
maximum for a star who receives billing credit above the title.  General and
company managers, press agents and attorneys are paid less than their usual
fees, advertising agencies are paid less than their usual commissions, and
even accountants, insurance brokers, casting directors and sign companies
take a reduction in their fees.  The New York Times will charge a Broadway
Alliance production the off-Broadway rate for display advertising, which is
approximately 22% lower than the Broadway rate.  In exchange for their concessions,
all union personnel working at a reduced rate on a Broadway Alliance
production share 10% of the weekly operating profits of the show after
recoupment (when the investors have been repaid their initial investment).

 The experiment got off to a slow start but has been a success
overall.  Two of the most recent Broadway Alliance productions, Love! Valour!
Compassion! and Master Class, won the Tony Awards for Best Play of their season,
recouped their investment and had long runs on Broadway.  Love! Valour!
Compassion! was made into a films.

 Roger explained that it is relatively simple to submit your
production for Broadway Alliance consideration.  The producer submits his or her
idea to the Broadway Alliance office at the League of American Theatres
and Producers, along with a $25.00 fee and 7 copies of the script,
production budget and operating budget.  Remember that the production budget may
not exceed $850,000.  Musicals are not accepted, although if your
production is a “play with music” rather than a musical, you may have live
musicians in your production.  Members of the musicians’ union, Local 802, will
play in such a Broadway Alliance production at a reduced salary.

 Of the other 2 kinds of  budgets discussed, Broadway and
off-Broadway, Roger reminded us that the budgets for a Broadway production will
necessarily be more complex.  There are many more unions involved in a Broadway
production, the costs are higher, and the sets and costumes more complicated.
Off-Broadway, the rates may be lower, and there may be fewer union regulations to
follow, but it still takes a great deal of time and thought to plan a
thorough, realistic budget for a show in a 199-499 seat house.  In addition, in
so far as the week-to-week management of a show, it’s just as much work
to manage the finances of a successful show running in an off-Broadway
theater as it is to manage a Broadway play that may have twice the budget.
In both cases there are bills to be paid, contracts to live up to, and
regulations to follow.


Bruce Lazarus the former Director of Business and Legal Affairs for Walt Disney Theatrical Productions and producer of the current off-Broadway show Shakespeare's "R&J."

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