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The Common Ground Music Festival might be attracting larger crowds, but recently released financial reports indicate its quasi public management company routinely bleeds cash and operates more than $1 million in the red.
An audit by the city’s internal auditor of last year’s festival recently reviewed by the City Council showed Center Park Productions — an entity managed by the Lansing Entertainment and Public Facilities Authority — tracked its most profitable event in at least the last four years. And it was still estimated to have lost at least $80,000.
Scott Keith, LEPFA’s president and CEO, contended the festival “absolutely” remains successful, noting the city-produced report can’t fully quantify the cultural value that a prominent festival like Common Ground brings to the community. But he recognized some changes will need to occur if the festival is to remain financially viable.
“We’ve been changing a lot over the last couple years,” Keith added. “It’s about knowing the footprint we have and the competition we’re up against in this changing music environment. It created some great, ongoing conversations. It’s made everyone more aware of the challenges of putting on a music festival in this market.”
The reports indicate ticket sales and annual contributions have continued to climb, but not as aggressively as artist fees and production costs. Center Park Productions in 2016 — after some rainy weather arrived and a massive check was cut to Tim McGraw — had lost more than a half-million dollars during a single festival.
Records showed Center Park Productions had then already accrued more than $600,000 in debt. The blow kicked the company a staggering $1.2 million into the hole.
And climbing out of financial depths that deep takes time. The recent audit didn’t list a fund balance for this year, but it’s estimated to be at least six digits in the negative.
“We need to control production costs and find affordable artists,” Keith added, noting how a larger upfront investment in infrastructure, like a permanent stage, could ultimately save money. “We’ve also looked at shortening days or perhaps expanding the festival over two weekends. We’re working on it.”
The audit offered some guidance for LEPFA, but first it slammed Center Park Productions for being less than transparent with its finances. Officials should be more honest about successes and failures and provide more detailed financial statements to determine whether additional support is warranted, according to the report.
And it would be easier to solicit additional sponsorships than it would be to try to boost ticket sales, according to the report. The size of the audience often depends on the fame of the artist — and that comes with a price tag. Keith said Lansing typically doesn’t find a spot on the bucket list of must-play venues for the musicians hired to play.
“Lansing isn’t the same market at Detroit or Chicago,” Keith said. “Sometimes we’ll actually pay more than what those cities would pay. These artists used to tour to promote an album. Now they release a single to sell their tour. That’s where they’re making all their money nowadays, and that’s reflected in the prices.”
City officials have kept a steady stream of cash flowing to the festival regardless of its financial woes. Reports showed Common Ground annually receives $130,000 — or $140,000 this year — from city coffers to subsidize the event. And Council Vice President Jody Washington said she isn’t ready to “pull the plug” just yet.
“I think one area they’re sorely lacking is marketing,” Washington added. “I’d also like to see a study of how it impacts our brickand-mortar businesses, hotels and restaurants. We also need to look at some other music types. I know I’ve heard from folks that they would like to see a gospel night. There are some things we can try.”
Lansing Mayor Andy Schor said he hasn’t reviewed any of the financial metrics from the festival. Reports for this year’s festival are still far from complete. But he plans to evaluate Common Ground’s future based on the data during ongoing budget discussions, much like any other event hosted under the city management.
“It seemed to have been successful this year by the crowds and talent brought in,” Schor said in a statement.