Taxpayers may wind up paying about $170,000 to cover expenses associated with Made in America, the two-day music festival promoted by Los Angeles Mayor Eric Garcetti and held outside City Hall.
Garcetti aides expect the city's tab for the commercial event, held over Labor Day weekend, will reach nearly $670,000. The company that staged the event, Live Nation, was required to provide $500,000 to pay for police patrols, street closures, trash removal and other city services.
Garcetti played a major role in bringing the festival to L.A. for the first time. Held in downtown's Grand Park, it drew tens of thousands of people and was restricted to those who bought tickets or received complimentary passes. On Monday, the mayor argued the event provided a benefit to the city that exceeded any unreimbursed expenses.
"We will absolutely net more as a city than we would" if it hadn't happened, he said. "I'm confident of that."
One neighborhood activist said Garcetti and other city officials should have driven a harder bargain with Live Nation.
"I just don't think the city should pay a penny," said James O'Sullivan, president of the Miracle Mile Residential Assn. "How many sidewalks can that pay for? How many pipes can it fix? That crucial infrastructure is crumbling, or deteriorating, under our feet."
Initially, single-day tickets for the festival sold for just under $100, with weekend passes costing $185. Prices were discounted in the final days before the event.
A comprehensive analysis of the festival's costs and economic benefits will be provided later this year, said City Administrative Officer Miguel Santana, the city's top budget official.
Garcetti has argued that the festival, which featured such acts as Kanye West, Iggy Azalea and Imagine Dragons, showed L.A. is capable of hosting a huge outdoor music event. Carol Schatz, who heads the downtown-based Central City Assn., said businesses there viewed the festival — and the customers it generated for nearby hotels and restaurants — as "a big plus for downtown."
"It's not just a dollar-for-dollar comparison. It's about the perception that it generates … that L.A. is really the place to do this and the place to do this in L.A. is downtown," Schatz said. That kind of publicity, she added, "is worth millions."
Garcetti said Philadelphia, which has hosted three Made in America festivals, offers an example of the gains cities can realize from such events. A 2012 report released by Philadelphia Mayor Michael Nutter estimated the two-day festival generated at least $10 million for the city's economy.
In Los Angeles, the city's Board of Police Commissioners received a report last week showing Made in America required more than $475,000 in police overtime pay. Services provided by the Department of Transportation, which handled street closures and other services, totaled more than $122,000, Garcetti spokesman Yusef Robb said. And the city Fire Department provided more than $35,000 in services, Robb said.
Scores of free tickets to the event were distributed by Garcetti aides to city officials, commissioners and staffers, including 12 of the 15 City Council members.
Los Angeles County negotiated a separate agreement that required Live Nation to provide $600,000 for use of Grand Park plus reimbursement for any damage to the park and its surroundings. County officials are seeking $83,000 in repairs from Live Nation.