Montgomery County's weird deal with Live Nation
- The Fillmore, now under construction (Photo: Jay Westcott)
Spurned local promoter files suit
In June, Seth Hurwitz and I.M.P, the Bethesda-based concert promotion company he co-owns, filed a lawsuit against top Maryland officials in an attempt to stop the state from releasing its half of the Fillmore’s construction costs. According to the suit, Montgomery County still hasn’t met two of the four conditions imposed by the General Assembly before the state will disburse its $4 million grant. A hearing has yet to be scheduled.
Hurwitz, whose company owns the 9:30 Club in Washington and operates Merriweather Post Pavilion in Columbia, has tangled with Live Nation before. Last June, he sued to stop its merger with Ticketmaster, citing what he called the company’s “death grip” on shed shows; that case is in the discovery stage. But this time is a little more personal. Hurwitz lives in Montgomery County — Bethesda, to be exact — and despite running the most successful club of its kind in the country, I.M.P. never even got the chance to compete for the project. When he heard, back in 2007, that the county had reached a preliminary agreement with Live Nation, Hurwitz offered to pay double the rent and contribute $2 million to the construction — or to pay for the entire construction if LDG handed the site over to him instead. The county told him he was too late, that it didn’t want to break its (non-binding) agreement with Live Nation.
Hurwitz has a lot to say about this subject. Just not on the record. A few days after we had an hour-long conversation, the following statement was forwarded to me by his spokesperson: “They keep trying to divert attention away from the real issue. ‘How much is this going to cost?’ is a valid question for any taxpayer to ask, and it should be simple enough to answer with bona fide construction estimates based on actual bids.”
He’s referring to one of the General Assembly’s conditions: a “full financial and cost analysis for the project and evidence that Montgomery County has budgeted all funds necessary to match state funds provided for the project,” the law reads. In the lawsuit, Hurwitz argues that the documents the county originally submitted to meet that condition — a two-page “cost sharing” analysis and a simplistic, one-page chart outlining costs and funding — are hardly comprehensive. And, in fact, nowhere in those three pages is there a description, itemized or otherwise, of the Fillmore’s design and construction costs. That it will cost $8 million is just assumed.
The other, allegedly unmet condition concerns a project economic feasibility study, for which the county submitted a 10-page report, “The Market for a Large Popular Music/Entertainment Venue in Montgomery County, MD.” Prepared by Baltimore-based Sage Policy Group, the report is as general as it sounds, comparing suburban Maryland’s demographics to those of 12 other metropolitan areas, including D.C., and although it never once discusses existing music venues in the region, it nonetheless concludes that the county “offers a nearly idyllic setting” for such a venue. Along with that report, the county included a single-page rundown of financial estimates for the project (which generously counts as revenue such items as complimentary tickets — the county gets six per show — and the free and discounted community uses of the space).
In its opposition to the lawsuit, the state’s Office of the Attorney General notes, “The General Assembly did not identify any specific parameters for satisfaction of the terms of this reporting condition beyond the quoted language.” Translation: the state didn’t specify what it meant by a “project economic feasibility study” or “full financial and cost analysis.” The office also argues that the aforementioned documents and several others, including an engineering and architectural feasibility study, were apparently sufficient to satisfy the Department of Legislative Services, which concluded on April 13 that the county had met all of the conditions.
County spokesman Patrick Lacefield calls Hurwitz’ argument “odd” for that very reason: If the state accepted the county’s documents and approved the disbursement of funds, then obviously the documents met the necessary conditions. “What you have to keep in mind with this project,” he says, “is that there’s a competitor to this project that doesn’t want this to open.”
Diane Schwartz Jones, the county’s assistant chief administrative officer, is more direct.
“It’s a continued effort to try to kill the competition, that’s what it is,” she says, “and why would anyone want to do that to Montgomery County?”
Montgomery’s budget woes
Like any competitive businessman, Hurwitz wants to be on top. It stands to reason, then, that he wouldn’t want Live Nation moving into the area. But he’s not the only one who wishes the 9:30 Club got a fair shot at competing for what is, essentially, the construction and operation of a government building.
“We thought their proposal should have been give consideration, from a taxpayer point of view, considering that it’s a local entity,” says Debbie Spielberg, the former chair of the Silver Spring Citizens Advisory Board. “It was never clarified to me why the process was the way it was, and why the 9:30 Club’s proposal wasn’t given equal consideration.” Roger Berliner, one of two county council members who opposed the deal — and the one who represents the district in which Hurwitz lives — says, “The 9:30 Club is literally the most successful club of its kind in the world, so how can we not have knocked on his door with a deal like this?”
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