Proposal Would Put Lolla's Tax Exemption Up To Board Vote
By Chris Bentley in News on Jan 20, 2012 7:00PM
Cook County Commissioner Bridget Gainer introduced a proposal this week suggesting Lollapalooza would need the approval of the County Board to skip paying city taxes next year.
That’s likely music to the ears of WBEZ’s Jim DeRogatis, who led the charge in questioning the massive concert’s sweet deal with Chicago.
The three-day festival rakes in about $20 million in revenue, according to the Tribune. And while promoter C3 Presents LLC did pay the Parkways foundation (Chicago Park District’s non-profit arm) $1,050,000 in 2010, the festival is exempt from the amusement tax any other concert would pay on ticket sales.
By dealing with the non-profit Parkways, Lolla's for-profit promoters qualify for tax exemption. That means the city could collect half a million dollars or more from Lollapalooza in taxes, in addition to a considerable fee to rent Grant Park.
Commissioner Gainer’s proposal would require a County Board vote on any amusement tax exemption that costs the city $150,000 or more. The measure state: The County Board “may deny the exemption application if it finds that the exemption is not in the best economic interest of the county.”
Mayor Rahm Emanuel has recused himself from any negotiations between the city and Lollapalooza’s promoters. Emanuel’s brother Ari is the chairman of William Morris Endeavor, one of the co-owners of Lollapalooza with C3. The mayor called for an independent investigation of the festival’s contract, which was negotiated in part by former Mayor Richard M. Daley’s nephew Mark Vanecko.
This is the first year Lollapalooza completely sold out ahead of time, and the crowds were a reminder that it can feel like the festival takes the city hostage for one weekend each August. Gainer’s proposal could loosen that knot — Lolla’s contract doesn’t expire until 2018, but the tax exemption has to be reviewed each year.