Lollapalooza gets set to spin

February 4, 2012

As an increasing number of city, county, and state officials question the long-term sweetheart deal the Daley administration struck with Lollapalooza, the massive lakefront concert is ready to spin its side of the story—and try to protect lucrative tax breaks that aren’t granted to any other local entertainment event.

Last week, the Cook County Board of Commissioners unanimously passed a move that gives it the authority to approve exemptions from the 1.5 percent county amusement tax. Sponsor Bridget Gainer made clear that the primary target was Lollapalooza, and it is unlikely that she and her fellow commissioners will grant the waiver if promoters apply for it for the 2012 concert.

Chicago officials are also expected to question the 5 percent city amusement tax waiver and the exemption from any rent for Grant Park that have been granted to the concert for the last seven years. Meanwhile, Illinois Rep. Sara Feignenholtz is examining the festival’s exemption from the 6.25 percent state sales tax, which Democrats desperate for revenue will have a hard time justifying, and at which downstate Republicans are likely to balk now that it has been made public.

All of this means a costly problem for Lollapalooza, which is contractually bound to Chicago through 2018. Last year, it took in about $21 million and donated some $2 million to its not-for-profit partner, the Parkways Foundation. This year, it may have to pay an additional $2 million or more in previously waived city, county, and state taxes if elected officials and the public continue questioning its special treatment. But the concert has turned to a politically connected and clout-heavy “strategic communications” firm that specializes in spinning such pesky and inconvenient dilemmas.

Buried in the recent coverage of the county tax vote in the Tribune and the Sun-Times was a quote from someone both papers described as the concert’s spokesman, Steve Patterson. “Lollapalooza has called Chicago home for eight years, and we appreciate and value the relationship we have developed with the city,” he said. “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.”

Steve Patterson, from the Res Publica Web site.The quote is typical boilerplate corporate-speak, and Patterson gave the same statement to this blog and any other media outlet that would listen. What’s interesting, and what the papers did not mention, is who he is and where he works.

A former reporter for the Gary Post-Tribune, the Chicago Tribune, and the Sun-Times, Patterson left journalism several years ago to serve as communications director for Cook County Sheriff Tom Dart. In that role, he generally was regarded as a straight-shooter. His connections with local reporters run deep and wide, and the same can be said of everyone at his new place of employment, the Res Publica Group.

Described by many local political insiders as “heavy hitters,” Res Publica was founded in 2002 by Guy Chipparoni, who worked as a spokesman for former Illinois Gov. Jim Edgar when he was secretary of state. The former governor is a “senior advisor” to the firm; other notable names listed as part of its team include TV anchorwoman Mary Ann Childers, former CTA President Richard Rodriguez, and Doug O’Brien, former chief of staff to Mark Kirk.

Guy Chipparoni, from the Res Publica Web site.Chipparononi’s official bio notes that he served for seven years on the board of the Metropolitan Pier & Exposition Authority, overseeing Navy Pier and McCormick Place, and that he’s on the advisory board of U.S. Bank. But there are accomplishments it doesn’t publicize, like representing disgraced developer and political fundraiser Tony Rezko, now serving 10 ½ years in federal prison. According to the Sun-Times, he made a cameo as “Individual HH” in the Rezko indictment.

The public relations executive’s other high-profile clients include Blackhawks owner Rocky Wirtz, who also owns a stake in the Sun-Times, and he has registered with the state in the past as a lobbyist for Wirtz Beverage.

Boasting on its Web site that it is “not just another PR firm,” Res Publica states:

“We specialize in public affairs, issues management, crisis communications, public relations and media relations. We help our clients navigate transitions, protect interests and reputations, build images, grow businesses, survive crises, and always, beat the competition.

“Our job is to provide confidence and direction; to look down the road and help you anticipate the obstacles that lie ahead.

“We over-prepare, so as not to overreact.”

Clearly, Lollapalooza has hired Res Publica to do more than issue press releases about its green initiatives and the acts that it has booked at Kidzapalooza.

Until now, the concert’s co-owners, promoters C3 Presents of Austin, Tex., and the William Morris Endeavor talent agency of Hollywood, never have had a local office, spokesperson, or representative. (Daley nephew Mark Vanecko, listed in the concert’s contract with the city as its lobbyist and attorney, never has spoken to the press.)

When the concert was reinvented in 2005 as a destination festival based in Chicago, the owners hired Venice Beach, California-based music-industry publicist Shelby Meade. C3 subsequently purchased Meade’s company, Fresh and Clean Media, and she has handled all of its communications here and for the recently launched spin-off concerts in South America.

Music publicist Shelby Meade.Unfailingly California-chipper but notoriously unresponsive to any question of substance or controversy, Meade and her minions have frustrated Chicago news reporters from day one with their cheerful but useless non-answers. The publicists even decline to give attendance numbers during the concert, the most basic of facts for such an event, making reporters wait until the following week.

“I spoke with Shelby and learned that after Lollapalooza’s expansion, she contracted with local agencies in all three cities,” Patterson wrote via email when I asked why he had been hired by C3. “We’ve been asked to help her with efforts here, as other agencies have in Brazil and Chile. She laughed and said she has yet to figure out how to clone herself to be in three places at three times, but you should know that she’s working on that.”

It’s doubtful that three Meades would be more useful than one, but Patterson is likely to serve Lollapalooza’s interests in a very different and possibly more effective way, doing his best to contradict or spin the increasingly skeptical and critical local media coverage of the concert’s business dealings.

Patterson spent several days successfully dodging my calls to ask about his and Res Publica’s new client—the slickest publicists these days try to “control” their message by only answering via email—but he did write back to say the firm will not be lobbying on behalf of the concert.

At first, Patterson said Res Public does no lobbying. I then pointed out that sources on the Web (SourceWatch among them) describe it as a lobbying firm, and that his boss has registered with the state as a lobbyist for at least one client, as noted earlier.

“We are a communications firm that has been hired to assist them with local communications efforts,” Patterson wrote. “As you pointed out on the state website, Guy Chipparoni did previously register as a lobbyist on one issue that involved one client, Wirtz Beverage. As the issue there advanced, the registration was done as a precautionary measure. There have been no other lobbying activities by Res Publica Group and we have no contract to do anything like that with C3, nor do we expect one.”

Of course, lobbyists don’t always register as lobbyists, at least not in the court of public opinion. And one person’s lobbying is another’s “issues management,” “crisis communications,” effort to “protect the client’s interests,” and attempt to “beat the competition”—and, perhaps, the tax man.

EARLIER REPORTS IN THIS BLOG ABOUT LOLLAPALOOZA’S SHENANIGANS

Feb. 1, 2012: County to Lollapalooza: Pay up!

Jan. 29, 2012: State rep probes Lollapalooza sales tax

Jan. 25, 2012: The county targets Lollapalooza's tax exemption

Sept. 18, 2011: Another pass for Lollapalooza: Restoring Grant Park

Aug. 8, 2011: Demand builds: Probe Lolla sweetheart deal

Aug. 2, 2011: Rahm: City will review Lollapalooza tax question

Aug. 1, 2011: Does Lollapalooza $hort Chicago?

April 7, 2011: Two key differences between the mega-fests, Dave Matthews Caravan vs. Lollapalooza

Feb. 24, 2011: Dear Rahm: How to quell fears about your ties to Ticketmaster/Live Nation and Lollapalooza and fix relations with the Chicago music scene

Feb. 7, 2011: Rahm Emanuel pledges hands off all dealings with Ticketmaster/Live Nation and Lollapalooza

Feb. 4, 2011: Rahm Emanuel: Pal$ with thuggish concert giants Ticketmaster/Live Nation and Lollapalooza