The play "First Monday in October," by Jerome Lawrence and Robert Edwin Lee, which was scheduled to open March 23, has been canceled.

Oregon Stage Works is ringing down the curtain. Peter Alzado, OSW's founder and producing artistic director, said the non-profit theater's lease in Ashland's A Street Market Place was up in December, and he won't renew it. The theater struggled with costs for years.

"It's never been affordable," Alzado said.

The play "First Monday in October," by Jerome Lawrence and Robert Edwin Lee, which was scheduled to open March 23, has been canceled.

OSW's production of Agatha Christie's "Mousetrap" last week finished a monthlong run during which it played to 90 percent of capacity. But it was too little too late. Some recent plays, such as David Mamet's "Glengarry Glenn Ross," filled fewer than 25 percent of the theater's 100 seats.

Alzado said the five-member OSW board of directors remains intact, and that the theater is talking with a potential donor about a large gift that could turn things around. He said there is a possibility of OSW mounting new productions in rented venues or moving from place to place as it did in its early years. Meanwhile, the company's lights and props and other materials will go into storage.

"It depends on the economics," Alzado said. "We're looking. But we can't be under the weight of that monthly obligation."

He said the Ashland Children's Theatre and OSW's Playwrights' Unit will continue to operate under OSW's aegis. The former offers classes and performances, the latter a setting for developing playwrights to meet and work on new plays.

"It's sad," said playwright Molly Tinsley, of Ashland, whose play "Glacial Genes" was presented at OSW. "I knew they'd been struggling."

Alzado opened the $150,000 theater in a former ironworks in June 2004 after two years of producing plays in locations such as a restaurant and a hotel. OSW's mission statement calls for "staging both classic and original works of artistic merit that entertain, challenge, and educate."

Often considered an off-Broadway-type theater, OSW produced plays ranging from Samuel Beckett's "Waiting for Godot" to Arthur Miller's "The Crucible" to Michael Frayn's "Copenhagen" to lighter fare such as "The Great American Trailer Park Musical" and "A Christmas Carol."

"We always wanted to do American works of some depth or weight," Alzado said.

Tinsley said she can't say that OSW misread the market in its programming.

"If the OSF (Oregon Shakespeare Festival) did 'Copenhagen,' it would have been well-attended," she said. "I'm mystified."

Alzado said the monthly cost of the theater's lease, utilities and insurance was more than $4,000.

OSW's attendance in 2009 was a little over 10,000. That's up slightly from 2008, Alzado said.

Early on, the theater won the support of actors from the prestigious Oregon Shakespeare Festival. OSF's Bill Langan directed "Glengarry Glenn Ross" in October.

But the theater was seldom able to pay actors anything and paid directors and technicians only small amounts. Some, such as director Doug Rowe, donated their fees back to OSW.

"They need to be paid," Alzado said.

Alzado himself often went unpaid or was paid only a minimal amount, and he worked at jobs outside the theater to make ends meet. He sold cars for Northgate Auto Center in Medford, but the business changed ownership in May and he lost the job.

"It meant if a show didn't do well we could pay the rent," he said.

The A Street Market Place building is owned by Plexis Healthcare Systems, a medical recording firm. Owner Jorge Yant could not immediately be reached for comment Wednesday.

"They've been good with us," Alzado said, "but we understand they're a business."

Alzado acted on Broadway and on TV soaps, taught acting at Long Island University and the University of Rochester and was artistic director of Actors' Theatre in Talent for five years. OSW was born in late 2002 when Alzado's contract as artistic director of Actors' Theatre was not renewed by the theater's board.

OSW signed a five-year lease in 2004. Also that year, it launched Ashland Children's Theatre with classes and summer camps serving more than 250 students, about one-quarter of whom were given scholarships. In 2006 OSW established its Playwrights' Unit for the development and production of new American plays. Three of the local playwrights participating were Oregon Book Award winners.

Using a grant from the Meyer Memorial Trust, OSW in January 2009 created the position of theater arts manager to guide the business side of the company and raise money. The grant put $40,000 into OSW's coffers last year, and would pay another $20,000 this year and $20,000 in 2011 — but probably not if the theater doesn't have a home and meet certain goals. The position is now vacant, and Alzado said he is working with the Meyer trust in hopes of qualifying for the balance of the grant.

Alzado said he expects to know whether the theater will get its hoped-for large donation within a month. He said if efforts to keep the theater going in some form don't pan out, he may look for a job teaching, or possibly acting or directing in professional theater.

Reach freelance writer Bill Varble at varble.bill@gmail.com.