DeRo Does The Math On City’s Lolla Contract

By Jon Graef in Arts & Entertainment on Oct 5, 2010 7:00PM

One Last Lollapalooza MusingJim DeRogatis is nothing if not consistently tenacious on the issue of Lollapalooza, its promoters, C3 Presents, and how the two directly affect the city of Chicago. In the past, DeRog has blasted the festival he’s dubbed as “Walmart on the Lake” for its 300-mile radius clause, arguing that it inevitably harms the local music scene.

Now, the “Sound Opinions” co-host is examining the deal that C3 has with Chicago, arguing that the city isn’t getting as much out of it financially as it could.

Indeed, DeRogatis asks some bold questions—and we aren’t just referring to his somewhat annoying tendency to put those questions into boldface.

Check out a key excerpt for yourself (hyperlinks from original article):

Five years into a long-term deal that keeps the massive concert in Grant Park through 2018, Lollapalooza has generated an average of a million dollars a year for a non-profit arm of the Chicago Park District dedicated to park improvements.

But the three-day festival, one of the biggest in the U.S., grossed more than $17 million last August, and politically connected concert promoters C3 Presents have struck a sweetheart deal with the city that exempts them from paying the taxes that any other concert or entertainment event would have to pay.

Altruistic claims in Lollapalooza’s press releases aside, the question looms:

Is Chicago really collecting all of the money that it should be getting from the musical Walmart on the Lake—especially in the midst of what’s been called the worst budget crisis in the city’s history, with city services being slashed and lay-offs of police, sanitation workers, and teachers threatened?

With that question in mind, DeRogatis breaks down the numbers in the city’s Lollapalooza contract, and explains how C3, as well as the alcohol and food vendors at Lolla, are benefiting from a backdoor deal at the expense of Chicago.

As DeRogatis concludes:

It certainly seems as if Lollapalooza’s financial deal with Chicago is ripe for examination by a City Council grappling with a staggering budget deficit and beginning to look at life after the Daley Machine, which could not have been friendlier to C3 at every turn.

Of course, there's more than one way to look at an issue. For more context, especially with regard to how the city's contract may actually unburden Chicago from paying extra taxes, check out Time Out Chicago E-I-C Frank Sennett's Twitter feed, which provides a good counter-balance to the DeRog piece.

In it, Sennett argues that by some measures Lolla may raise indirect revenue for Chicago. Though Sennett says DeRogatis should raise questions, he also argues that those questions would benefit from what he calls "trade show context."