Floats May Be Priced Out of Pasadena

During these days between Christmas and the New Year, thousands of people line up on Raymond Avenue in Pasadena to tour the Rose Palace parade float barn -- and unwittingly to witness what may be the end of an era.

The Rose Palace, a city-owned facility, is the only place in Pasadena where floats are still built. It may prove to be the last. A confluence of factors -- from a rise in the rent on the building to its location in the midst of a city redevelopment zone -- is forcing parade organizers to consider relocating construction of floats out of the Rose Palace. And that, in turn, has raised this once unthinkable prospect:

Soon, no Rose Parade floats may be built in Pasadena.

To longtime parade fans, such a possibility might seem like Switzerland without clockmakers. But it is in keeping with the changing relationship between Pasadena and the Tournament of Roses, the not-for-profit organization that puts on the parade and Rose Bowl.

Once so close that Pasadena City Council members were generally granted Tournament of Roses membership, relations, while cordial, are now more formal and distant.

Contacts between Pasadena and the parade that made it famous are governed by a 72-page master agreement that treats the city as landlord and the parade as tenant. Unlike competing New Year’s festivals in Miami and New Orleans, the Tournament of Roses receives no public subsidy to tie it to its hometown.

Already, more than half of the parade floats are built in tournament-owned barns in Duarte and Azusa. And nearly two-thirds of the tournament’s volunteers -- the white-suiters who are famous parade-day ambassadors for the city -- live outside Pasadena, according to its roster.

This fall, the future of the Rose Palace facility has emerged as the latest sign of separation. According to public documents, the city will soon raise the rent from $87,600 to $209,315 annually. City officials say the increase reflects market rates; parade officials say such a steep hike could eventually leave them little choice but to end their Rose Palace lease and find another place for building floats. Given rising property values in Pasadena, finding large and affordable warehouse space would be difficult.

“Would we like to stay in Pasadena? Absolutely. But clearly in the long run, we’re being priced out of this place,” said Scott Jenkins, a lawyer who represents the tournament and also is a high-ranking volunteer member. “From my personal perspective, I think the city is trying to give us incentive to move on.”

Jenkins said the city and the tournament continue to cooperate closely in handling security and operations of the parade. But financially and legally, “the relationship is more arm’s length than it was before.”

For much of its history, the Rose Parade was largely run by the city fathers, who were eager to attract residents and visitors by showing off the warm winter weather. As a matter of self-interest, city leaders were more willing to join the tournament, pay its membership dues and volunteer time during the holidays for the glory of Pasadena.

With such overlap between city and parade officials, the relationship was informal. The bylaws of the Pasadena Tournament of Roses Assn. say only that the parade operations should be headquartered “at any place within the State of California.”

But in the second half of the 20th century, the tournament’s membership remained mostly white and conservative, even as Pasadena became more diverse. A decade ago, after a furor over the selection of a descendant of Christopher Columbus as grand marshal for the 1992 parade, local activists and a young mayor criticized the tournament’s lack of racial diversity and scrutinized its relationship with City Hall.

In 1994, under pressure, the tournament made two fundamental changes. It altered its leadership structure to allow women and members of minority groups a shorter path to its executive committee. And it entered into a detailed master agreement with the city government.

The agreement established a schedule of rents that the tournament would pay for use of city-owned facilities, from the Rose Palace and the Rose Bowl to the tournament headquarters on Orange Grove. It spelled out a variety of other fees, totaling more than $1 million annually, to cover the costs of the parade. It also required that annual operating profits be shared with the city. And, to the annoyance of some tournament rank-and-file members who must scramble for extra tickets, the document granted the city extensive ticket rights for both the parade (2,100 seats) and the game (1,200).

Since its adoption eight years ago, the agreement has drawn bitter, if private, criticism from some tournament volunteers, who complain that city political leaders are more interested in collecting money and tickets than in the health of the parade.

The organization’s most recently available tax records, for the years 1996 to 2001, show the tournament is hardly a financial colossus. The tournament has annual revenue of about $8 million, much of it from the game, which is used to subsidize the money-losing parade. The tournament’s chief executive officer, Mitch Dorger, makes $173,639; he is one of only two employees who make more than $100,000, tax records indicate. Net operating profits have been small, topping out in 2000 at $381,000.

Those finances, combined with the newer master agreement, leave the tournament less flexibility in dealing with rising rents and land prices in Pasadena. Rather than rent more Pasadena facilities to build floats, the tournament itself now owns large warehouse sites for float building and storage east of Pasadena, in relatively less expensive areas of Azusa and Duarte. (The well-known Rosemont Pavilion in Pasadena, also a city facility rented by the tournament, can be used for decorating floats but not building them.)

Among parade insiders, speculation is rampant that Rose Palace float construction could move east in the next few years. The city’s decision to double the rent is only one indicator.

City officials say they are eyeing the building for redevelopment as part of a new technology corridor. The Rose Palace is an attractive site because it is close to the Huntington Memorial Hospital, a new campus for Art Center College of Design and a station for the coming Gold Line trains to downtown L.A.

“That area is promising for redevelopment, and float building -- even though it’s important to the city -- is not the highest and best use for that area,” said Eric Duyshart, Pasadena’s economic development manager.

CL Keedy, the Tournament vice president who handles real estate issues, cautioned that there has been no official decision to leave the Rose Palace and that “we won’t exclude Pasadena or any other city” if a replacement must be found.

Duyshart said the city has already tried to help the tournament find alternative sites in Pasadena. But the cost of Pasadena real estate, combined with the need for a float warehouse as large as 50,000 square feet, has stymied the search.

“Float-building is not a great fit for the land values in Pasadena,” Duyshart said.

Inside the Rose Palace, float builder Bill Lofthouse said he has had little word on the future of the building.

As owner of Phoenix Decorating, Lofthouse subleases the building from the tournament, which rents it from the city. As the last Pasadena float builder, he is an unofficial ambassador for the event, and treasures his location as a place to meet visiting dignitaries and talk about the art of float building.

But as the parade’s largest float builder, he would welcome a new, larger facility. At the Rose Palace, he built 25 of the 54 floats for the 2003 parade. The 25,000-square-foot space allows him to have only eight floats on the construction floor at one time. He would prefer a new 50,000-square-foot facility.

“We don’t want to leave the city,” he said. “But something will have to happen, and I don’t know what it will be. Wherever we end up going, it’s going to be hard to stay in Pasadena.”