EXCLUSIVE: Before the Public Theater fired a fifth of its staff, the downtown institution faced a financial crisis.
When it disclosed layoffs last July, the renowned nonprofit company said that it hoped to avoid a budget deficit in the year ending in August 2023. Instead, expenses exceeded revenue by $8 million that season, according to its most recent audited financial statement, which was obtained by Broadway Journal. That was the 70-year-old organization’s biggest budget deficit in at least a decade.
The Public’s fundraising as well as its income from the Broadway transfer of Hamilton remain well below their peak. Still, cutting programming and 19 percent of staff put the Public on track to post a much smaller deficit this fiscal year, a person familiar with its finances said. In a time of contraction for many performing arts companies, the Public is weathering the storm better than most.
Artistic Director Oskar Eustis has said he plans to exit when his current contract expires July 31, 2028, which is his 70th birthday. “Four years is not going to be long enough to solve everything,” he said on Guy Raz’s Great Creators podcast in April. “But I really hope I can get the Public back on a really stable economic and cultural footing before I leave so that I’m handing over a really solid enterprise to my successors.”
To that end, the Public announced just six full productions downtown this season — five at its Astor Place headquarters, one at New York University. They include the return of Elevator Repair Services’ acclaimed Gatz, in which F. Scott Fitzgerald’s The Great Gatsby is performed word-for-word. (Tickets are priced at $210 and appear to be selling well for the eight-hour event, which includes a dinner break.)
In 2018-19, the last complete pre-pandemic season, the Public staged 10 productions downtown, plus the popular Under the Radar Festival. (The Public later ended the festival’s residency to save money; it was resuscitated in January at nonprofits around the city.)
The Public has a long and proud history of mounting risky, adventurous shows — and more recently of operating without much scrutiny of its finances. It’s the only major New York theater company that doesn’t post its audited financial statement on its website or make the document available upon request. (The financials eventually get disseminated on a registry maintained by the New York Attorney General’s office, after a long lag.) Executives may be skittish about drawing attention to their good fortune: the Public doesn’t pay rent for its five theaters downtown or the Delacorte in Central Park, and it’s made tens of millions of dollars from Hamilton — facts that could impede fundraising.
With the industry hurting since the pandemic, Eustis has been chattier about his challenges. “We are without doubt the most successful nonprofit theater in American history at creating hits,” Eustis recently told the Economic Club of New York, citing A Chorus Line and Hamilton, which opened to acclaim at the Public in February 2015. “But they’re not enough to fund the place down here.”
Eustis — an administrator, orator, director and dramaturg — took over the institution in 2005 and has overseen dramatic growth. In the 13 years ending in August 2023, its annual budget nearly tripled, to $62 million. Eustis and Executive Director Patrick Willingham declined an interview request from Broadway Journal or to answer written questions.
The Public is in the rare position of having three musicals that it developed running on Broadway simultaneously: Suffs, Hell’s Kitchen and Hamilton. For its part developing Hamilton, the Public earns 1.5 percent of Broadway grosses and 5 percent of net profits, plus income from tours. At Hamilton‘s peak in 2018-19, the Public’s royalty and subsidiary rights income totaled $24 million, mostly from the musical. That was nearly double the Public’s ticket sales for its shows off-Broadway and produced a $26 million surplus for the season.
Today, Hamilton remains profitable but the mania has cooled. In 2022-23, the Public’s royalty and subsidiary rights income was down by half since the pandemic, to $12 million. Still, should Hamilton ever close, it will leave a huge hole.
Meanwhile, expenses climb upward. In the Economic Club of New York interview, Eustis noted a rise in the cost of labor and materials. “Everything is just dramatically more expensive.”
Public Theater stagehands recently voted to unionize, which will likely lead to increased wages and outlays for benefits. And Actors’ Equity Association has reached a new, four-year agreement with the Off-Broadway League, which affects the Public, with cumulative salary increases of 17 percent to 24 percent, according to an email from Equity to its actor and stage manager members.
Eustis told the Economic Club of N.Y. that work rules “have gotten much tougher in the wake of the pandemic, and not necessarily wrongly.” He didn’t specify which rules.
The Public spent a whopping $7.5 million on fundraising in 2022-23. Its needs are vast. In Central Park alone, as of August 2023, it had commitments of $59 million for the renovation of the Delacorte, which is scheduled to reopen next August.
Executive compensation exerts a small but high-profile pressure on the budget. Eustis’ package was up 10 percent in 2022, to $1.2 million. Willingham, who was paid less than leaders of other big theater companies in the past, saw his comp soar 50 percent in 2022 to $723,000.
In setting executive pay, the executive committee of the Public’s board “received a report from an independent consultant with comparative data from peer cultural institutions in budget and program size in New York City and across the country,” according to the Public’s Form 990 posted on its web site. “Using this data, the committee determined a comparable compensation level.”
