Cuthbert Up for Bids
Sparks fly as city looks at privatizing amphitheater.
BY MELISSA BEARNS
In an attempt to revitalize the stagnating Cuthbert Amphitheatre, city staff has quietly moved forward with a plan to privatize booking of the city-owned and -operated facility by bringing in an outside concert promoter. After receiving just three proposals, all from local promoters, and dealing with two protests from one of the respondents, the city is finally entering the next stage of the process. Wednesday city officials began negotiations with the finalist: Kesey Enterprises, Inc., in conjunction with Double Tee Concerts (KE/DTC).
Former Cultural Services Director Robb Hankins was one of the first people to suggest privatizing the Cuthbert. "The city has run it [the Cuthbert] for quite a long time," he said. "And most people inside and outside the city would say they're not really happy with what they've seen out there. A private entity is going to be able to secure the acts and move more quickly than the city can, so I think this is a step in the right direction."
Not everyone is thrilled with the selection of Kesey and Double Tee. Some feel that as the only non-profit to file a proposal, The Shedd, which came in a distant second place in a point system, would have been a better choice. And as the City Council embarks on creating a comprehensive plan for Eugene's Cultural Services, some City Council members question whether now is the time to turn over one of our biggest assets to a private company.
At the heart of the discussion is the unanimous desire by city officials, Eugeneans and the organizations that put in proposals to see Cuthbert open and successful, with lots of shows at varying prices, serving as a cultural resource for the community. In the end, Kesey and Double Tee might be the ones who can accomplish that.
A slow demise
Controversy over what to do with the Cuthbert is nothing new. Longtime Eugene residents probably remember the mid-1990s when you could go see a big show almost every summer weekend. "It's a great facility in a great park," said Mark Loigman, director of operations for Eugene's Cultural Services Division. "When the stars are aligned, there is nothing better. You've got wildlife nesting in the trees. You've got this beautiful river behind it." On a clear night beneath the summer sky, families, friends and couples sprawl on blankets, hanging out and listening to music. Then they bike, walk or drive home, leaving the Cuthbert with magical memories.
But those days ended more than a decade ago. Now Cuthbert sits locked behind a chain-link fence and barbed wire. Last summer the gates opened just four times, for The Chieftans, an OFAM show, Trick Pony and the Afro-Latin Orchestra. Not one of those shows was put on by an outside promoter — OFAM and the Hult Center sponsored the events, either alone or in partnership.
Back in the '90s, the city put on many successful shows but outside promoters also used the venue, renting it out from the city for the sold-out, big-name shows that people remember such as Santana, The Dave Matthews Band and B.B. King. Over the last five years, outside promoters such as House of Blues, OFAM and Double Tee brought in most of the shows at the Cuthbert. So, while the venue is owned by the city, it's more often the independent, for-profit concert promoters who've brought the big names to Cuthbert and shouldered the considerable financial risk.
"Cuthbert gobbles money because the city needs to maintain it and puts all that staff time into it," said Jerry McDonnell, chair of the Cultural Services Advisory Committee (CSAC). Cuthbert is run by the city, which has contracts with two different unions for stage work and maintenance of the facility, and putting on a show at the Cuthbert costs outside promoters top dollar. In addition, over the last decade the concert promotions industry has seen rapidly rising prices from artists and declining ticket sales.
Cuthbert seats 4,500 and during the entire 2005 season, 3,496 tickets were sold. With all ticket sales added together, the shows in 2005 didn't even fill the Cuthbert once. "All you have to do is look at the ticket sales, and you can tell all those shows lost a lot of money," said one industry insider who asked not to be identified. That's a big part of the reason Cuthbert has remained unused. The costs and risks are just too high.
A search for options
But Eugeneans love the Cuthbert and want to see the gates thrown open. So does the city. "Our vision for Cuthbert over the years has always been this successful, robust, busy summer season with name-brand national acts priced right so people flock to see them, where the weather is perfect and they have a great time parking and strolling to the event; where they bring their own food and also buy food so the food vendors are happy; where they buy beer so the beer vendors are happy, all of that," said Loigman, pausing for a breath of air. "That's the goal. Cuthbert is a very special place that a very small part of the population has been able to enjoy. The reality has been somewhat different from the goal."
That's probably why last spring Hankins prioritized finding a new plan for the Cuthbert. In a July 7 article in the Eugene Weekly he said he wanted to rip down the fences, open up the venue and better integrate it into Alton Baker Park.
Last fall Hankins left Eugene after just two years for another job, but the city picked up where he left off. In October city officials sent out a request to concert promoters across the country. Called an RFP (request for proposals), the city was looking for an outside promoter willing to lease the Cuthbert from the city and put on events throughout the summer.
Only three organizations responded: The Shedd (the local non-profit also known as OFAM); Big Green Events (the promoter that organized last year's Eugene Celebration); and Kesey Enterprises, Inc. in conjunction with Double Tee Concerts (KE/DTC), which run the McDonald Theatre and the Roseland Theater in Portland respectively.
A six-person committee made up of Kirk Boyd (director of Willamette Repertory Theatre), Jerry McDonnell (a local architect and chair of CSAC), Mark Loigman (director of operations for the Cultural Services Division), Karm Hagedorn (events manager for the City of Eugene), Rob Hallett (turf and grounds supervisor for Parks and Open Space) and Meredith Fox (facility project manager with the city's Facility Division) evaluated the three proposals. They scored each proposal using 10 differently weighted categories including financial wherewithal; financial gain to the City of Eugene; concept plan that demonstrates optimal utilization of the amphitheater for concert and event promotion and implementation; individual team members' qualifications, education and experience; and experience in the recreation, hospitality and entertainment industries.
The committee members worked separately from each other. But when the scores were tallied, the proposal from KE/DTC was the unanimous first choice of every committee member, scoring 1071 out of a potential 1,200 points. The Shedd scored 815 and BGE scored 398. Based on the scores, on Nov. 25 the city announced that only the KE/DTC proposal had made it to the next level: the short list. "Usually when we short list proposals, they score the same or within a point or two of each other. So that's considered a fairly large break," said Mia Cariaga, buyer in the city Purchasing Department.
The large difference in the scores even surprised some of the committee members. "We didn't go in with preconceived ideas," said Boyd, who was the Hult Center's representative on the scoring committee. "We scored each one on an individual basis, added up the score and went 'Whoa!' I was very surprised. I felt both Jim's [Jim Ralph, executive director of the Shedd] and Kit's [President of Kesey Enterprises] proposals were very strong."
Selection committee member McDonnell described the KE/DTC proposal as "much more elegant in its simplicity" and said, "All three entities were very sincere in wanting to do the best job they could. That came out very clearly." Loigman said in the end, one of the key reasons the committee chose KE/DTC was because all the members believed that Kesey and Double Tee have the best chance of actually programming and executing a successful summer of events at Cuthbert.
Not without a fight
After requesting a copy of the KE/DTC proposal and reviewing it (all three proposals are available to the public), Shedd Executive Director Jim Ralph felt the evaluation process didn't match the RFP criteria. On Dec. 2 he filed a protest with Jeff Perry, the city's purchasing manager and financial operations manager. On Dec. 6 Perry denied The Shedd protest, and on Dec. 9, The Shedd appealed that decision to City Manager Dennis Taylor. Taylor was out of the office, so Assistant City Manager Jim Carlson responded to the Shedd's appeal, upholding Perry's decision.
"The nature of our proposal was to protect the city from losses, but to create a balance between national top music acts, world music style events, folk music and also to encourage local non-profits to use the space," Ralph said. "We also wanted to work in collaboration with the city to encourage some free concerts out there."
According to the timeline in the RFP, city staff planned to go before the council and manager Dec. 16 to get the OK to move forward with the final contract negotiations. "The timeline was thrown off because we can't proceed with the short list process until a protest is completely finished."
Wednesday Kit Kesey (Ken Kesey's nephew) and David Leiken (Springfield Mayor Sid Leiken's uncle) of Double Tee met with city officials for an interview, the next step in the process. "We'll be interviewing them for clarification on their proposal, but we are not in any type of contract negotiation at this point," explained Cariaga. "We can only begin to negotiate the contract once the award has been made."
Show me the money
The introduction of the RFP says, among other things, "the purpose of this RFP is to select a qualified individual or organization (Respondent) to successfully operate and promote the Cuthbert Amphitheatre." In the section on objectives it states, "This RFP does not specify a distinct 'best use' for the Amphitheatre site. Instead the city seeks proposals from qualified respondents that would increase the use of the Amphitheatre and surrounding areas."
In the scoring, the concept for the use of Cuthbert counts the most, while financial gain to the city and experience in the business are equally weighted.
The KE/DTC proposal guarantees the city the most money, offering an annual rental fee of $30,000 for the space and also a percentage of profits from ticket sales, concessions and sponsorships. "In the CSAC meeting, I wanted the committee to understand that this is, by far, the most commercial proposal," said Boyd.
But it's not just about the money. The list of concerts put on by KE/DTC reads like a roster of the biggest bands in the music business including Bright Eyes, G. Love, NOFX, Dierks Bentley, Toots and the Maytals, the Newsboys, Medeski, Martin and Wood — the list goes on and on. On top of that, Double Tee has been in the business for 33 years. "David Leiken [of Double Tee] is the best buyer in Oregon," said Brendan Relaford, a partner in Big Green Events.
The Shedd has also brought in some big names and greatly diversified Eugene's music scene, but it doesn't have three decades of experience with the proven track record of successful, money-making events that KE/DTC has. Still, Ralph was disappointed The Shedd didn't at least make it for final consideration. "We provided an operational plan that specifically provided for a range of concert events from top national acts like the ones we do at the Hult Center and The Shedd, as well as other music that we could bring in at a lower price," he said. "It was a very different model than the model presented by Double Tee and Kesey."
Contracts and wise counsel
Jim Ralph isn't the only person who's concerned that KE/DTC is the one respondent considered a finalist. In the proposal, KE/DTC specifically refers to the need to renegotiate the existing contracts in order to be able to run the Cuthbert cost efficiently. "This reduced overhead will be an important factor in our ability to lessen financial risk, allowing for a more ambitious in-house concert promotion schedule," reads their proposal.
Michael Carpenter is the business agent for the Stage Hands Union Local #675, which currently has a contract for work at the Cuthbert. "While it is disappointing that Cultural Services could not find a way to operate the Cuthbert, it will remain a city-owned facility and we are still city employees with a contract to provide stage labor," he said. "So that relationship will have to be worked out with us and the city and any new management."
"We have to negotiate all existing contracts at a competitive level," Kesey said. "We're going to insist on none of the current standing contracts being in place. But at this point, nothing is a deal breaker. We'll work it out."
In the meantime, City Councilor David Kelly caught wind of the plans for the Cuthbert and on Dec. 12 requested information on the RFP. "I had heard kind of second or third hand about the city putting out the RFP to privatize the operation of the Cuthbert and I was surprised by that for a couple of reasons," he said. "I asked the city manager to put together a memo for the mayor and council to answer a few questions. The first was, if staff is deciding to privatize a significant city facility, shouldn't they ask the council first? That strikes me as a decision of a big enough magnitude that council ought to have been consulted. My second question was, as you may or may not know, the city is just starting a comprehensive plan for the Cultural Services Division. The council funded the creation of this comprehensive plan back in July, and they're just at the stage where they're about to pick a consultant to head this effort up. If we're just starting on a comprehensive plan process for the division, isn't it premature to make a decision about a major asset of that division?"
But according to the RFP timeline, city councilors will not only have a chance to discuss the city staff's final choice for booking Cuthbert before a contract is signed, they can also request a public hearing.
No big bucks?
No matter who takes over the Cuthbert, given the current market conditions and challenges of the venue, it's unlikely any promoter is going to be raking in the big bucks. "If this all works out, I just hope to break even," Kesey said. "I want to bring music, entertainment and events to Eugene. That's my intention."
Ultimately, it's the public who will decide what happens to the Cuthbert. "I want to give them a try," McDonnell said. "If the ticket prices are too high, people won't buy them and the promoter will take a bath on it. If people don't like them, they won't buy tickets just out of spite. They've got to find the right mix of what show, what form, and at what cost. If they book the wrong stuff and the people of Eugene don't like it, they're going to take it in the shorts."