Thursday, October 7, 2004

Tall Stacks deficit vanishes

Carl Lindner will kick in $125,000, city will simply write off the other half

By Kevin Aldridge and Cindi Andrews
Enquirer staff writers

Cincinnati City Council agreed to a deal Wednesday to forgive roughly half the $248,000 debt owed by the Greater Cincinnati Tall Stacks Commission.

In exchange, Cincinnati Reds owner Carl Lindner will pay the city the remaining $125,000 on behalf of Tall Stacks. Council voted unanimously to use that money to reduce the number of "brown-outs" at firehouses in six city neighborhoods by eight days.

Council's decision came just a few hours after Hamilton County commissioners approved spending $250,000 for the next Tall Stacks. Festival organizers assured commissioners the money would not be used to cover its debt to the city.

"It's not anything any of us wants to do," said Mayor Charlie Luken, who worked for a year on a deal to settle the Tall Stacks debt. "This is the best of some bad alternatives that we have. If you think this makes me happy, you're wrong."

The 2003 Tall Stacks Music, Arts & Heritage Festival drew a record crowd of 800,000 people downtown over five days last October and generated about $48.5 million for Greater Cincinnati. The festival lost money and wound up owing the city $311,000 for police and fire overtime.

The city and the Tall Stacks Commission negotiated a two-year payment plan in April to handle the debt. The commission made a payment of $50,000 in June and was scheduled for a $75,000 payment in January.

The Tall Stacks Commission was able to cover some of its other debts through post-event fund-raising. A number of businesses and individuals contributed, including Lindner, who gave $150,000.

Luken said the chances of collecting all $248,197.89 in the near future were bleak. He said festival organizers gave him a deadline of Friday to accept their offer.

"That (the deadline) really concerns me because it's not acknowledging their failure in the transaction with the city," said Councilman Christopher Smitherman, who cast the lone dissenting vote. "This muddies the water on how we go forward, not only with Tall Stacks, but with other transactions."

Several council members said the city needs to be more careful when dealing with festival organizers. Councilwoman Laketa Cole said she would not support giving Tall Stacks money again unless it could guarantee payment.

The Tall Stacks Commission had a budget of about $11 million in 2003. The city contributed about $240,000 to the event - not including the cost of police and fire overtime.

Vice Mayor Alicia Reece said she was concerned about setting a precedent - particularly when the city has aggressively gone after organizers of African-American events that have owed the city money. Reece said the city needs a uniform policy for how it deals with all events.

"I don't want us to forget about this when they come back for another event," Reece said.Some council members said using the $125,000 to reduce brown-outs by a total of eight days makes the deal more palatable. Council passed a policy two weeks ago stating that any additional revenues collected in the next three months would be used to reduce brown-outs.

Brown-outs happen when firefighters call in sick, are on vacation or otherwise cannot work. They save the city money by temporarily keeping fire companies out of service rather than paying firefighters overtime to staff them.

The county, meanwhile, will pay Tall Stacks organizers $90,000 this year and $80,000 each of the next two years. County commissioners voted 2-1 for the funding, with Phil Heimlich saying he supports the festival but doesn't support using the county's economic development fund to help pay for it.

"It's a signature event for the region that has the potential of generating tremendous sales tax and hotel/motel tax for the county," Commissioner Todd Portune said.

Mike Smith, executive director of the Tall Stacks Commission, said the festival brought in more than $700,000 in tax revenue for the county. Plans for the next Tall Stacks have not been finalized, he said, but the commissioners' action is an important vote of confidence.

"This allows (organizers) to sit down and talk about next steps," he said.

Lone dissenter

Councilman Christopher Smitherman was the only vote against forgiving roughly half the debt owed by the Greater Cincinnati Tall Stacks Commission.


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