enlarge Doug Jones/Staff Photographer

Michael Bourque, chairman of the Children’s Theatre of Maine, found the group facing a deficit a year after he joined the board. “Here we were trying to do more, but not even earning our way.” Behind him, members prepare for a dress rehearsal at the Children’s Museum of Maine.

enlarge Jack Milton/Staff Photographer

James McCarthy of Seacoast Science Center, left, and Michael Bourque, chairman of the Children’s Theatre of Maine, talk during a workshop on becoming more effective board members put on by the Institute for Civic Leadership at Saco City Hall.

Click here for a look at arts and cultural nonprofit groups in Maine.

THE NEXT STAGE: THE FUTURE OF THE ARTS IN MAINE

SUNDAY: As the number of arts and cultural nonprofit groups grows, leaders in the field are urging groups to collaborate, coordinate and merge. We examined the factors driving the nonprofit arts sector toward financial crisis and explore possible solutions.

TODAY: For many arts and cultural nonprofit groups, success lies squarely in the hands of those who serve on their boards. We look at the challenges faced by board members today and what some members are doing to increase their usefulness.

Michael Bourque learned a lesson about leadership soon after joining the board of the Children's Theatre of Maine in May 2005.

At the time, he had every reason to believe he was getting involved with a stable organization with sound financial underpinnings. It had an annual budget of about $500,000 and a solid reputation in the community.

A little more than a year later, Bourque became president of the board and soon after found himself in the uncomfortable position of explaining to the community why the theater teetered on the brink of a crisis with a deficit of $50,000.

The board implemented several emergency measures to survive. It now is in the midst of a modest 2007-2008 performance schedule, and its immediate future involves an exploratory partnership with the Children's Museum of Maine.

The story of the theater and Bourque's tenure as president is instructive, because it illustrates both the precarious nature of even a well-established arts nonprofit group and highlights the vital leadership role a board plays in shepherding an organization through adversity.

From Scott Schnapp's perspective, the lifeblood of any nonprofit organization comes down to leadership.

Schnapp, executive director of the Portland-based Maine Association for Nonprofits, has witnessed the struggles and successes of nonprofit groups most of his professional life. Those that face challenges and manage to thrive do so because of the leadership skills of their boards, he said.

"Once you embrace a mission, success or failure comes down to who's involved," said Schnapp. "When you have creative leaders, they tend to figure it out. Nonprofits often complain they are underfunded and misunderstood. Those issues both go back to management. It always comes down to leadership."

Leadership is especially critical in Maine, which has 1.77 nonprofit organizations per 1,000 people, a higher ratio than all but Vermont, Alaska and Montana, according to Schnapp.

Across all sectors, Maine nonprofit organizations provide 1 in 8 jobs and $2 billion in wages annually. In Portland, arts and cultural nonprofit organizations generate $28.64 million in economic activity and support 877 full-time jobs, according to a survey by the arts advocacy group Americans for the Arts, using data from 2005.

Among arts groups, the need for leadership is acute. In recent years, Maine's nonprofit arts and cultural sector has witnessed an upheaval in leadership, from large and established organizations -- Maine College of Art and the Portland Symphony Orchestra are two high-profile examples of arts groups that lost their leaders -- to those that serve specific populations, such as the Children's Theatre of Maine.

For organizations large and small, board members play crucial roles in articulating a mission and executing a vision.

When Bourque got involved with the Children's Theatre, the board had just received a consultant's report suggesting the theater was in position to launch a capital campaign of between $3 million and $5 million to build a new performance space or buy an existing building that it could turn into a theater.

Throughout his first summer on the board, Bourque and his colleagues considered various real estate opportunities in Greater Portland. By the fall, they began seriously discussing bidding for the former armory building in South Portland.

All the while, Bourque had his doubts.

Although he came to the Children's Theatre with skills in marketing -- Bourque works as a vice president for marketing at Maine Employers' Mutual Insurance Co. in Portland -- he sharpened his oversight, planning and accountant's tools when he joined the board.

It didn't take long for him to realize there was a widening gap between the theater's income and expenses.

"We had this feasibility study saying we could raise $3 million to $5 million for this building project, even...