In the latest turn in the heated battle over who should run the Greek Theatre, a Los Angeles city commission voted Wednesday in favor of letting the city temporarily operate the Griffith Park venue itself.
Parks department officials first floated the controversial idea earlier this year, after the commission and the City Council ended up at loggerheads over warring bids to run the Greek, a coveted and lucrative venue that last year grossed more than $27 million.
The Board of Recreation and Parks Commissioners recommended last year that Live Nation take over the theater, echoing the recommendation of an evaluation panel arranged by an outside consultant.
But the council voted against that idea and asked the parks commission to consider redoing the process amid an outcry from neighborhood groups concerned about pulling the venue away from the company that has operated the Greek for decades -- the Nederlander Organization. Nederlander had bid to continue running the venue alongside new partner AEG.
Faced with a stalemate, the parks department came up with another idea. Under the new “open venue” plan, no promoter would exclusively run the Greek. The city would take on responsibility for maintaining the theater and would control the concert calendar, allowing Live Nation, Nederlander and other promoters to book acts one by one.
Promoters would still be responsible for managing and paying musicians, advertising concerts, and paying for security and ushers. The city would also hire an event management staffing company to provide those ushers, ticket takers, security and other staff as needed.
At a Wednesday commission meeting, the idea drew scorn from many residents.
"The City Council told you, 'You didn’t do your job properly.' They threw it all out and said start over … and instead of starting over you said, 'You know, we screwed up so maybe we should run it ourselves,'" Studio City resident Allan Erdy said, spurring laughter. "That’s not an answer."
Mike Shull, who heads the parks department, stressed that under the plan, the facility would be run by industry professionals and not by parks staffers. “We will not be managing the venue,” he said. “We will leave that to the professionals.”
The plan has “high potential for increased revenue,” a report from the parks department stated. It estimated that under the new system, the city could yield between $3 million to $4.8 million in net revenue next year, compared to the roughly $2 million it reaped last year.
Live Nation said it fully supported the plan and would make “significant financial commitments” for the chance to bring its tours to the Greek. The plan has also won support from the Los Angeles Parks Foundation and the Los Angeles Neighborhood Land Trust, which praised it as a way to get badly needed revenue for the parks system.
The added money represents “tremendous revenue for a department that ... is in critical need,” said Mark Glassock, director of special projects for the Los Angeles Neighborhood Land Trust.
Beyond those touted advantages, Shull has said there are few alternatives available to the city at this point other than operating the theater itself, at least temporarily.
The Nederlander contract expires at the end of October, leaving little time to restart the selection process, he said. If city officials still want to redo the bidding process, they could do so while the city temporarily operates the Greek, he explained. Under the plan approved Wednesday, the Greek would operate as an open venue for at least two years.
Nederlander has bristled at that argument, saying the city could also extend its existing contract to run the venue and should do so to make sure the Greek remains in capable hands.
“They don’t have expertise in the concert industry. They don’t have expertise running a venue of this size,” said Rena Wasserman, general manager for the theater under Nederlander. “I worry that self operation would quickly throw the building into the Dark Ages.”
Many neighborhood groups have also been skeptical. A letter from the chair of the Los Angeles Neighborhood Council Coalition, which includes scores of neighborhood councils, called it “irresponsible and reckless … to risk taxpayer dollars on this ill-conceived venture.”
The Greek Theatre Advisory Council, the Los Feliz Improvement Assn. and other local groups have also opposed a city takeover. “The Greek is not broken,” Hollywood resident Lauren Simon said to the parks commission on Wednesday. “So why are you trying to break it?”
Nederlander also argued that it could match the money that L.A. believed it would gain from the new model: In a letter to the parks commission, Nederlander proposed extending and amending its existing agreement to increase its annual guaranteed minimum rent to the city to at least $3.5 million.
But Live Nation has warned against extending the Nederlander contract, arguing in a letter to the commission that “a public landmark like the Greek should not be beholden to the same company decade after decade in a manner that is anti-competitive.”
Echoing those concerns, Shull said extending the contract would not be fair. Commission President Sylvia Patsaouras said that the department could not simply accept the Nederlander offer to pay higher rent without giving other companies a chance as well.
The parks commission approved the plan 3 to 1 on Wednesday, with Commissioner Iris Zuñiga opposed. Zuñiga said she was concerned with how quickly the plan had been drafted and how thoroughly it had been thought out.
Nederlander issued a statement immediately after the vote saying it was disappointed with the decision. But the company also pointed out that "if this plan is to be implemented, it would require several more steps by the department."
Parks officials plan to return to the commission soon with a draft rental agreement for concert promoters, as well as more detailed plans for event management services and other aspects of theater operations.
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