In a major boost to its role as an incubator of new musicals, Signature Theatre is receiving $1 million from a New York benefactor to create three original full-length productions that will debut on the company's new main stage in Arlington.

The gift, from former investment banker Theodore P. Shen and his Shen Family Foundation, is the largest award ever to the 17-year-old theater for purposes other than construction.

A substantial portion of the American Musical Voices Project funding will go to the three composers commissioned by Signature, who each will receive $100,000 over four years, as well as health coverage. The musicals are to be staged by Artistic Director Eric Schaeffer during three successive seasons, beginning in 2007-08.

"This puts Signature on the map with major theaters in New York, like the Public Theater and Lincoln Center Theater, in that we are not only producing but also creating new musicals for America," Schaeffer said. "That's really a big thing."

For Washington theaters, a financial incentive of this magnitude -- geared to the development of new work -- is the extreme exception, although such companies as Woolly Mammoth, Theater J and Arena Stage with some frequency sponsor or commission new plays and musicals.

The Kennedy Center, through its reconfigured Fund for New American Plays, offers $75,000 annually for an original American play. The money is given to a regional theater that then brings its production to the center. In June, the offering is Don DeLillo's "Love-Lies-Bleeding," presented with Chicago's Steppenwolf Theater.

It is rare for creators of musicals-yet-to-be to receive such sizable funding. Shen, a Brooklyn resident and an ardent Stephen Sondheim fan -- his foundation was a financial backer of the Sondheim Celebration at the Kennedy Center in 2002 -- says he wants to foster original, "music-driven" work in the spirit of his idol: "Everything I'm doing with this younger generation of musical theater composers is inspired by my love of Sondheim."

The company has signed the writers who will receive the $25,000-a-year stipends. The three -- Michael John LaChiusa, Ricky Ian Gordon and Joseph Thalken -- have had their works staged by major companies and are in the vanguard of younger, serious composers seeking to put a new stamp on musical theater. In some cases, their shows have been even more cerebral than those of the sophisticated Sondheim, composer-lyricist of "Sweeney Todd," "Into the Woods" and "Follies." As such, the writers have tended to appeal to more specialized audiences, and none of their productions has achieved breakout status.

Signature worked with LaChiusa on "The Highest Yellow," a musical based on Vincent van Gogh's life that had its world premiere at Signature in fall 2004. LaChiusa's most prominent show was a musical version of the Joseph Moncure March poem "The Wild Party," which starred Mandy Patinkin, Eartha Kitt and Toni Collette and ran for 68 performances on Broadway in 2000.

Gordon created "My Life With Albertine," a work based on Marcel Proust's "Remembrance of Things Past" that had its debut at off-Broadway's Playwrights Horizons in 2003. Thalken composed the music for the stage adaptation of the cult movie "Harold and Maude" that had its premiere last year at the Paper Mill Playhouse in Millburn, N.J.

Thalken said yesterday that the opportunity was deeply meaningful. "One of the great things about this commission is that it will allow me, more than ever than in the past, to block out time for myself," he said, explaining that he's made a living in related jobs, such as conducting (he conducted on Broadway several years ago for "Victor/Victoria"). "We would all love to have enough income to be doing what we want to be doing."

LaChiusa, Gordon and Thalken each will create an entirely new musical for Signature. LaChiusa's work will come first -- a workshop will be held in the coming season, and then a full production in 2007-08. Thalken's work will be presented the next season, and Gordon's the season after that. Money also will be provided for a librettist if the composer wants a collaborator, Schaeffer said, adding that the costs will cover productions that include as many as 18 actors and 10 musicians.

News of the windfall caught the composers off guard. LaChiusa got the call about the commission April 1. When informed of the amount, Schaeffer said the writer replied, "Is this a joke?"

Shen, who retired from investment banking in 1999, said that he nursed a passion for musical theater since seeing Sondheim's "Company" on Broadway 36 years ago. His foundation, formed in 1993, has provided financial support for many musicals at nonprofit theaters, including shows written by LaChiusa, Gordon and Thalken.

The gift includes one-time "musical theater leadership awards," of $25,000 each, to four artists recognized for their contributions to new modes of musical theater: actress Audra McDonald; Adam Guettel, composer of "The Light in the Piazza''; orchestrator Bruce Coughlin; and director-orchestrator Ted Sperling.

Signature is undergoing significant change. Later this year the company will move into a new $12.5 million complex, encompassing two theaters, in Shirlington not far from its current home in an industrial area. One-fourth of the Shen gift will pay for rehearsal space in the new structure.