Lollapalooza could lose a big tax break they’ve been getting for nearly a decade under a measure Cook County commissioners passed Wednesday in response to a Chicago Sun-Times report.
That’s because the measure gives the county board final say on whether big-ticket events — such as the annual Lollapalooza music festival in Grant Park — should be exempt from the county amusement tax. The measure allows the board to reject a proposed exemption if it’s not in the best interest of the county.
Commissioner Bridget Gainer, who spearheaded the measure, says the practical effect of the measure likely means Lollapalooza will likely have to pay the county’s share of the amusement tax — 1.5 percent of the ticket price on events drawing 5,000 people or more.
“I don’t know that a festival that makes $20 million a year is one of the things that needs to be subsidized by the county taxpayers,” Gainer told reporters after the vote.
There was no opposition to the measure; Commissioner John Fritchey voted “present.”
From now on, commissioners will vote on any amusement tax exemptions in which the county would lose $150,000 or more.
The change comes months after the Sun-Times reported the city and county have been granting amusement tax exemptions for the highly lucrative Lollapalooza music festival in Grant Park for the last seven years. In 2011, that meant promoters saved $1 million in taxes at the event.
The arrangement cost the county $350,000 in amusement tax revenues last year.
Gainer previously served as a board member of Parkways Foundation — the Chicago Park District’s non-profit that sought the tax exemption for Lollapalooza. Years ago the exemption was perfectly legitimate since “it wasn’t necessarily a foregone conclusion that you could get people down to Grant Park” for the concert, Gainer said.
Today, the exemption is unnecessary, she said.
“It’s a great success story of when government works together with the private sector to come up with cultural entrepreneurship, I think it’s a success that no longer needs government assistance to move forward,” Gainer said at Wednesday’s board meeting.
Lollapalooza’s promoters C3 Presents didn’t comment on the legislation specifically Wednesday.
But the promoter issued a statement through Chicago-based spokesman Steve Patterson: “Lollapalooza has called Chicago home for eight years, and we appreciate and value the relationship we have developed with the city. We look forward to talking with city leaders about the best way to continue our partnership, and we look forward to calling Chicago home for many years to come.”