The Crystal Lake-based Raue Center for the Arts has received a multiyear, $150,000 grant that could support a possible expansion into East Dundee.

The grant, from the Illinois Arts Council and the National Endowment for the Arts, will fund “a strategic expansion and restructuring of the organization’s educational programs and exploratory efforts to establish a new satellite theater location,” according to a news release from the Raue Center.

The new theater in East Dundee was first pitched by Raue Center officials last year at a former lumberyard property off Railroad Street that the village purchased in 2023 for $800,000 to aid redevelopment.

Since then, developer Sightwell proposed the creation of an 8,000-square-foot performing arts center, which could possibly be run by the Raue, and 6,000 square feet for retail space. Dubbed Heritage Station, the proposal also includes nine to 12 townhouses, along with five to six rental apartments above the retail shops. A space called The Station House would aim to offer 10 “boutique lodging” suites.

Project approval could take months, but Sightwell owner Andy Burns said at an East Dundee Village Board meeting in August that construction could start as early as 2026 and be completed by 2028.

“While this project is in its early stages, it’s really encouraging to see such incredible support for a theater that will serve as a catalyst for our community,” East Dundee Village President Dan Pearson said in the release.

Raue Center Executive Director Richard Kuranda told East Dundee village trustees last year that he envisioned a 250- to 350-seat theater, with the potential for outdoor performances in the downtown district, which includes the Dundee Depot, a popular spot for the village’s outdoor summer events. The center hopes to have a theater open within the next four to five years.

With the grant funding, the nonprofit also will transition the Raue Center School for the Arts programming to the Williams Street Repertory, which operates out of the St. Mary’s Parish campus and the Raue Center, 26 N. Williams St. in downtown Crystal Lake.

“This grant is a powerful endorsement of our vision to deepen our impact across the region,” Kuranda said in the release. “It acts as a catalyst, allowing us to reimagine arts education under Williams Street Rep and explore creating an additional, vibrant artistic home in East Dundee. This enables us to serve more students and nurture the next generation of artists more effectively than ever before.”

The funding will allow the Raue Center to continue being a home for performance entertainment while providing educational theater programming through classes, workshops and camps for all ages.

“This grant is a game-changer,” board President Tim Paul said in the release. “It empowers us to build a more accessible and innovative artistic future for the entire region. We are committed not only to continuing the excellent work of the Raue Center School for the Arts but to expanding its reach, ensuring high-quality theater education is available to all.”

The Raue Center has weathered some funding woes in recent months as it approaches its 25th anniversary. According to a fundraising initiative called “Survive and Thrive,” cuts in federal arts funding and “economic uncertainty” caused the nonprofit to slash programming and staffing, according to its website.