Irvine City Council members could green light a new amphitheater that’s expected to cost taxpayers over $100 million at their upcoming Tuesday meeting after giving residents just a couple of days to review the deal.
The amphitheater is set to be the heart of the Great Park, Orange County’s largest municipal construction project.
City leaders have been negotiating with Live Nation – a ticket broker who will run the venue – for months amidst questions over whether or not it’s the right step forward.
The proposed 75-page contract with Live Nation was released on Friday without any analysis from city staff, and city council members are set to discuss approving the deal at a special meeting on Tuesday at 1:55 p.m.
To read a copy of the contract, click here.
The limited review window for the public has already drawn protests from some residents.
Councilwoman Kathleen Treseder said she would refuse to approve it without more time to look over the proposal.
“That is simply not enough time for my office to evaluate the contract,” Treseder said in a Facebook post last Thursday. “It is of great concern to me that I may be required to vote on this item without the opportunity for due diligence.”
When city leaders discussed the amphitheater in February, residents, city staff and council members raised concerns that Live Nation was getting a deal that benefitted the billion dollar entertainment giant more than the city, who would’ve had to wait over two decades to break even on their investment.
“Suffice to say, I think they must take us for chumps,” said Councilman Larry Agran at the February meeting. “This is so bad, and it is getting worse every step of the way.”
Other council members argued it’d be a big revenue generator for the city, and put them back on the map the way the Irvine Meadows amphitheater did for over 40 years.
“Think 10 to 20 years in the future when development starts to slow down. Where is that revenue going to come from?” said Mayor Farrah Khan at the same meeting. “We have to come up with a new revenue stream. And that revenue stream is the Great Park.”
The final design and seating arrangements for the amphitheater haven’t been decided yet, but it would have at least 14,000 seats, and would be open for events from March to Nov. 15 every year.
Under the new contract, the amphitehater’s construction costs would be capped between $130 and $140 million, with the city set to pay as much as $110 million toward construction while Live Nation pays between $20 and $30 million.
If the construction ends up running late, the city will be required to pay Live Nation $10,000 for every day they run behind.
Under just the annual operating fee, it would take the city over 20 years to break even.
In addition to their initial investment, Live Nation will also pay an annual operating fee of $3.5 million, which will increase by 3% every year, and guarantee the city a portion of money for every ticket sold.
But it remains unclear exactly how much money the city will get from ticket revenue, with a promised $2 per ticket if they sell less than 80,000 tickets a year and $4 a ticket if they sell more than 200,000 tickets.
Live Nation will keep all parking revenue and money from any sponsorship or naming rights of the amphitheater.
The city’s maintenance fees at the facility are set to be covered by a $4 surcharge on every ticket, with Live Nation set to cover the costs of the sound equipment and other equipment they bring in while the city keeps up the facility itself.
The contract would also grant the city its own box, a common arrangement with public amphitheaters and similar venues that’s led to questions over conflicts of interest in Anaheim at Angel Stadium, with city leaders giving out free tickets to events to aides and political allies.
The city would only get to use the amphitheater for its own purposes five times a year, which they would need to schedule in advance with Live Nation.
Noah Biesiada is a Voice of OC reporter and corps member with Report for America, a GroundTruth initiative. Contact him at firstname.lastname@example.org or on Twitter @NBiesiada.