San Diego Three months after he cohosted a "birthday party" fundraiser for City Councilwoman Valerie Stallings's 1998 reelection campaign, veteran San Diego concert promoter Bill Silva has been given what critics are calling a sweetheart deal to produce rock shows on city-owned land in Mission Bay Park.
Among the questions being raised: Why was the project not submitted to a wide-open bidding process, and why is Silva paying the city 5 percent of gross ticket sales - half the rent the city typically charges promoters to use the Civic Theatre or the San Diego Sports Arena?
Critics also point out that the $50,000 minimum guarantee for five months' worth of shows is less than the city makes each year from Street Scene, which lasts just two or three days.
"Bill Silva has obviously negotiated a great deal for his company," says David Swift, San Diego area manager for Avalon Attractions, the Los Angeles-based concert-promoting company that is Silva's chief rival in the local market. "There are certainly some costs he needs to incur, with staging and site setup, but even with those costs, it's still a great deal - and we both know relationships with various people helps business."
"If it's a city facility, there should be a process by which it goes out to bid," adds another local concert promoter who asked his name not be used. "I think there is a process, but Bill has so many political cronies in town that they favor him." Silva's political largess is well documented. He's given money to perennial mayoral hopeful and County Supervisor Ron Roberts and Councilman Juan Vargas. In the summer of 1995, Silva gave Deanne Spehr, an aide to Councilwoman Judy McCarty, a pair of free tickets to a Bob Dylan concert he was producing. And in October 1994, Silva hosted a festive fundraiser for Mayor Susan Golding in his private skybox at San Diego Jack Murphy Stadium during the Rolling Stones concert. At least $11,300 was raised from an assortment of developers, hoteliers, tourism officials, and others, many of them with business before the city.
"From the fact that he is a prodigious fundraiser for the mayor and city council, it certainly creates the perception that he received favorable treatment," says Ruth Holton, executive director with the California chapter of Common Cause. "And certainly members of the city council should be aware that if someone gets favorable treatment and also happens to be a good fundraiser, people will think that treatment wasn't just on the merits of the case, but on the relationship with the council."
Silva defends his practice of giving money to local politicians. "We contribute to candidates we think will further a good business climate in this community - not necessarily our own business agenda, but business in general," he says. "This city, in my estimation, is one in which it is very difficult to do business, and we need politicians who are willing to lessen the bureaucracy and be receptive to the businessman's plight. And if you look at the people I've supported - Ron Roberts or Valerie or Juan Vargas - you'll see they are all people who have different philosophies on life and politics, but they all try to engender a healthy business climate in this community."
Besides, he adds, his deal with the city to produce for-profit shows on Hospitality Point was okayed not by the council, but by the city manager's office. "None of them had anything to do with the decision," he says. "It was all done at the staff level. I never even spoke to the city council about this deal throughout the whole process." Holton responds: "Staff are not ignorant about who the big campaign donors are. That doesn't excuse anybody."
Silva says his new deal with the city, which gives him "exclusive use of portions of Mission Bay Park" - specifically, Hospitality Point - from May 15 through October 31, is merely an extension of an earlier deal he cut last year after the demise of the San Diego Symphony, with which he had coproduced shows since 1992. In that year, the symphony, plagued by poor attendance at its outdoor "Summer Pops" series, decided to try adding rock, jazz, pop, and country acts to the bill to boost ticket sales and tapped Silva as its concert promoting partner. Five shows were lined up for Embarcadero Marina Park South, owned and maintained by the San Diego Unified Port District, in a makeshift outdoor facility with room for about 5200 people.
The next year the lineup was expanded to 14 shows, including appearances by Whitney Houston, Kenny Loggins, and the band Chicago, which ended up drawing a total of nearly 50,000 people and grossing in excess of $1.2 million. Under the deal, Silva and the symphony agreed to split all profits and losses.
Just before the second season got underway, the arrangement drew heat from two other promoters who produced summer concert series, Avalon Attractions at the San Diego State University Open Air Theater and Richard Bartell at Humphrey's on Shelter Island. They claimed Silva was being given an unfair competitive advantage by linking with the nonprofit symphony, which paid the port district no rent for using the park. In December 1993, two months after Silva's final show for the 1993 season, operators of Humphrey's filed a $125,000 damage claim against the port, claiming commissioners discriminated against Humphrey's when they allowed the symphony to stage for-profit shows with Silva. "Based on Mr. Silva's arrangement with the symphony," Bartell recalls, "he was producing the same type of shows we were, but he paid no rent. And we felt that was unfair."
Bartell says the claim was subsequently resolved when the port agreed to charge Silva the same rent he was paying at Humphrey's: 3 percent of food sales, 5 percent of beverage sales, 5 percent of ticket sales, and 10 percent of sponsorship fees, "which in our case came out to be more than $100,000 a year."
Silva continued to produce outdoor shows at Embarcadero Marina Park South for two more years. The 1994 season grossed nearly $2.2 million and attracted 76,925 spectators; the 1995 season generated gross sales of just under $2 million and drew crowds totaling 78,382, according to figures supplied by his office.
Last year, when the Republican National Convention came to town, the Summer Pops series was moved back to Hospitality Point in Mission Bay Park, where the symphony had originated its outdoor summer shows back in the middle 1980s. When the symphony filed for bankruptcy in the spring of 1996, Silva and the city signed a five-month deal of their own that allowed Silva to continue staging pop shows on Hospitality Point. Again, other local promoters cried foul, this time because no one else had been invited to bid. "It was so close to summer that there was no time to put it out for bid," explains Terri Williams, deputy director of the city park and recreation department's coastal parks division. "He had already worked on it [the season] and had even booked some acts."
Under his solo deal with the city, Silva produced 14 shows by acts ranging from the Moody Blues to Linda Ronstadt. The concerts drew a total of 59,595 people and generated $1,460,344 in revenue. The city received 5 percent of gross ticket sales, 3 percent of food sales, and 5 percent of beverage sales, for a total of $62,288. The new contract Silva and the city just signed is for the MayPOctober 1997 concert season, with two one-year options "at the sole and absolute discretion of the city manager." Due to complaints from Avalon Attractions that the first contract had not been sent out to bid, Williams says, the city last December ran two weeks of ads in the San Diego Daily Transcript seeking proposals. City officials also approached Avalon, Bartell, and a third promoter who has worked in the San Diego area, the Nederlander Group of Los Angeles, and invited them to submit proposals.
But Silva "was the only valid response" the city received, Williams maintains, so he got the contract. The terms of the agreement are the same as last year's, except that the city stands to reap 5 percent of food sales instead of 3 percent. Silva also must guarantee a minimum of $50,000, with all proceeds going for upkeep of Mission Bay Park.
Silva insists "it's not a sweetheart deal. Each year we have to pay $300,000 to $350,000 to build and install the site - in staging, fencing, electrical, dressing rooms, equipment acquisitions, labor costs, ad infinitum. And then on top of that, because of the size of the venue and the fact that it's in a public park that needs to be cleaned every night after each show, we spend another $300,000 to make it presentable to the public. So we're spending between $600,000 and $650,000 a year in operations. Nothing's permanent, and there's no assurance that we will have it next year. The reason there were no other proposals is that everybody I talked to thought it was a crazy and insane deal and doesn't make sense financially. If it did, other people would have submitted bids."
Both Avalon's Swift and Humphrey's Bartell, however, say the reason they did not submit bids is that they were busy producing summer concert series of their own elsewhere. Another promoter said he did not submit a bid because he felt he could not have gotten the same terms Silva, "with his city hall connections," was able to negotiate.
Critics also fault the selection process, wondering why ads for a proposal were run in a tiny downtown business paper with a circulation of less than 10,000, instead of a nationally circulated entertainment trade like Billboard, Variety or the Hollywood Reporter.
And while Silva points out that he pays the same percentage of ticket, food, and drink sales to the city as Humphrey's pays to the port, critics note that Humphrey's holds its concerts in its own facility, on its own leased grounds - for which it already pays the port more than $600,000 a year in rent.
"If I were Bill Silva I would be very happy with the deal," concludes Avalon's Swift. "But if the city were in it just for the money, they could have done a better job."