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A reporter once asked the late playwright Robert Anderson if he could make a living writing for the theater. Anderson replied, you could make a killing but not a living. For the playwright who hasn't had a hit on Broadway, making a living can be tough.

But Arena Stage, in Washington, D.C. wants to change all that, as Jeff Lunden reports.

JEFF LUNDEN, BYLINE: Arena Stage's artistic director, Molly Smith, had wanted to find ways to support living playwrights for a long time. A couple of years ago, Arena got a $1.1 million grant from the Andrew W. Mellon Foundation, to establish the American Voices New Play Institute. And a good chunk of it is dedicated to a playwrights program, says Smith.

MOLLY SMITH: The idea for this major new program at Arena was to be able to give playwrights a living wage, to be able to give playwrights health care, housing when they're here in Washington, D.C., and research and development money and a young producer to work with them, so that writers really can drive their own process, because we believe that you follow the writer.

LUNDEN: And, after a year, that program is starting to bear fruit.

(SOUNDBITE OF CONVERSATIONS)

LUNDEN: On a recent Tuesday morning, the lobby of Arena Stage was buzzing with 50 people, wearing name tags, drinking coffee and eating pastries. They were there for a ritual that happens at most regional theaters on the first day of rehearsal - the meet and greet, where cast members, production staff and theater employees get to know each other.

Today, it was the first rehearsal for "You, Nero," a new play by Amy Freed. And somewhere in the crowd she was nervously milling about. The group went into the theater for official introductions, as David Dower, Arena's associate artistic director, took the stage.

DAVID DOWER: Good morning.

CROWD: Good morning.

DOWER: Excellent. So here we go, first rehearsal for "You, Nero." This is the second production to come through the residency program and we're blessed to have Karen Zacarias, who had the first production...

(SOUNDBITE OF APPLAUSE)

DOWER: Thank you for joining us. And we'll also hear from Amy Freed, also resident playwright at Arena.

(SOUNDBITE OF APPLAUSE)

LUNDEN: And, a few minutes later, Amy Freed addressed the group.

AMY FREED: I'm so happy and excited to be here and terrified. And you know, this play is happening, as part of my residency here, as a writer on salary with the Arena Stage - which is like two words that have never gone together in my lifetime.

LUNDEN: Shortly afterwards, Freed, the staff and actors gathered in a rehearsal room to read through her play, set in an ancient Rome, where playwrights have given way to bread and circuses. Marc Vietor kicked it off, as the harried playwright Scribonius.

(SOUNDBITE OF PLAY, "YOU, NERO")

MARC VIETOR: (as Scribonius) In the darkest days of Rome, there came to rule an emperor so wicked and so cruel that his name should not be mentioned, for fear the very sound of it might draw his twisted spirit forth to walk again. You know, of course, of whom I speak. I speak of Nero. Nero.

LUNDEN: A day later, in the beautiful townhouse Arena has rented for its playwrights, Amy Freed reflected on her residency. She says, for a midcareer playwright, who's been working in regional theater for the past 20 years, collecting a $40,000 annual salary with benefits and hooking up with an institution like Arena Stage is life-changing.

FREED: You hit this kind of plateau where you go, OK. I guess I've achieved what I'm going to be able to achieve. I've gone as far as I can in the American theater, I suppose. But I haven't gone to where I thought I could go, if given the opportunity.

LUNDEN: Being a resident playwright at Arena has allowed Freed to really think big. In addition to "You, Nero," she's working on two other projects - a play about modern architecture and design and a play about the 19th century Utopian community in Oneida, New York. Both require considerable research and Freed says she's already taken advantage of her annual $15,000 research budget to travel, poke through archives and meet with potential collaborators. And to see plays in New York.

FREED: And these sound like simple things, but when they're coming out of your bank account, as a playwright, they're crippling.

LUNDEN: Arena has committed to produce one work by each of five writers, over the course of a three-year residency. And any other plays they write, as salaried employees, can be produced at any other theater around the country.

Polly Carl, director of the American Voices New Play Institute, thinks it's a pretty radical idea. Normally, she says...

POLLY CARL: You commission a writer. You own that writer's play to a certain degree. And we're trying a really a very different model.

LUNDEN: Karen Zacarias, a Washington, D.C.-based playwright, is taking full advantage of the opportunity; working on several projects, including one for the Oregon Shakespeare Festival, while still feeling like she's part of Arena Stage.

KAREN ZACARIAS: The strength of this program is that they want you to be as involved with the family as possible, but also really insistent and respectful that your main objective is to write. And writing is a solitary process. So the fact that you're gone for a week or two, no one sees you, then they know you're actually doing your work.

LUNDEN: Zacarias was the first resident playwright to have her work performed at Arena. She used her first year to rewrite an earlier play. Her comedy, "The Book Club Play," had its run in an intimate 200-seat theater called The Cradle, devoted specifically to new work.

ZACARIAS: Usually new plays are put in a basement, in a black box, somewhere in the theater. The fact that one of the most beautiful spaces in the city is dedicated to new work is so exciting. And I have to say, rocking The Cradle is a blast.

(SOUNDBITE OF PLAY, "THE BOOK CLUB PLAY")

LUNDEN: Next season, Arena Stage will produce two new plays by some of the other resident playwrights. Institute director Polly Carl says she'll be closely watching how the program evolves.

CARL: What does it mean for a writer? How does it make a difference in their careers and how can we do it better? And can it work in the way that we've structured it? I don't really have an answer to that.

LUNDEN: In the meantime, "You, Nero" starts performances at Arena Stage on November 25th.

For NPR News, I'm Jeff Lunden.

(SOUNDBITE OF MUSIC)

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