Documents shed some light on 60th [corrected]

Costa Mesa made a slim profit from food and alcohol sales at its 60th anniversary celebration this summer, according to documents obtained by the Daily Pilot, but the overall cost of the event remains a mystery.

City officials have declined to provide most public documents related to the celebration, citing an ongoing personnel investigation. But KB Event Management, which handled the food and drink portion of the event known as O.C. Tastefest, provided its contract with the city as well as profit and loss estimates to the Daily Pilot this week.

Employees in charge of planning the event — Public Affairs Manager Dan Joyce and Christine Cordon, a special events coordinator — were placed on paid leave in August pending the outcome of the investigation.

Meanwhile, documents handed over by KB showed that it and the city each made about $3,000 from food and drink sales through a revenue-sharing agreement.

KB was responsible for vendor booths for food and alcohol during the June celebration of the city's birth.

The company also handled alcohol sales at the main stage, where attendees could pay admission to hear musical acts throughout the three-day event.

KB Managing Partner Gary Kutscher said the main stage area is where the city should have reaped the greatest reward, but the audience numbers were disappointing.

"Unfortunately that area wasn't as populated as everyone would have liked," he said.

According to Costa Mesa's contract with KB, the city was to receive 90% of the profits from alcohol sales at the main stage. Calculations from KB show that the payout to the city was $2,204.31 for the three days, after deducting costs related to the VIP portion of the event.

"It's very easy to see that that's where they would really have seen a good benefit to them had there been a much larger participation with those main stage bands," Kutscher said.

The city also received 20% of profits from separate food and beverage sales, which amounted to $906.12, according to KB's documentation.

A city spokesman did not return a request for comment on the numbers of tickets sold at the main stage area and whether alcohol sales there were intended to offset other costs.

KB puts total alcohol sales, including the main stage and elsewhere, at just under $60,000.

Mike Scheafer — who led the residents committee charged with overseeing the event — said the city hasn't told him attendance numbers, but anecdotally, the main stage turnout was low.

"It was very much lacking," he said. "It was way overestimated the number of people who would want to come see these musical acts."

City staff never informed the committee of the revenue-sharing portion of KB's contract, Scheafer said.

Kutscher said KB provided its documents to the Daily Pilot to refute accusations that the company was being investigated for its involvement with the 60th.

Earlier this month, Orange County Fair Board Director Nick Berardino expressed concern over the fair — which has hosted O.C. Tastefest — working with KB.

"How do we protect ourselves from any mischief, you know, that may be caused by some of the folks that do outside business here, who may, you know, retain money for themselves, not tell us the truth about the agreements we have?" Berardino asked at an August fair board meeting.

KB co-owner Scott Baugh showed up at the next meeting to denounce Berardino's statement.

Berardino is also the general manager of the Orange County Employees Assn., which represents employee unions in the county, and Baugh is the Orange County Republic Party chairman.

Kutscher and Baugh say KB's intent from the beginning was to raise money for the OC Marathon Foundation, not for the company. KB also runs the annual OC Marathon in Costa Mesa.

The company waived the usual fees it would have charged because it has a working relationship with Costa Mesa from past events, Kutscher said.

The foundation was included to help procure a liquor license for the event, according to Kutscher.

To sell alcohol at a special event, state law requires that a foundation be involved. The OC Marathon foundation was promised at least $5,000 for its participation, Kutscher said.

Ultimately, the foundation received the agreed-upon $5,000 and the rest of KB's profits as a donation, about $3,000, according to the organization's documents.

The foundation's main event is the annual Kids Run the OC, a training program for local schools that promotes healthy lifestyles for youngsters.

"We're trying to be honorable," Kutscher said. "We're trying to be professionals here."

[For the record, 11:46 a.m. Nov. 7: This article should have stated that O.C. Tastefest, and not KB Event Management, made about $3,000 from food and drink sales through a revenue-sharing agreement with the city. In addition, it was O.C. Tastefest, and not KB Event Management, that donated the about $3,000 in profits to the OC Marathon Foundation.]

Copyright © 2019, Daily Pilot
EDITION: California | U.S. & World