The Los Angeles Recreation and Parks (RAP) Commission approved on Wednesday preliminary plans for the city to operate the Greek Theatre.

The Greek Theatre may operate as an open venue under a decision made by the RAP Commission on Wednesday. (photo by Edwin Folven)

RAP staff recommended the motion after plans to choose a private operator fell through during a drawn out process that began May 2014.

The historic music venue, located at 2700 Vermont Ave. in Griffith Park, was officially dedicated in 1929. In 2014, the Greek Theatre generated $27.270 million in gross receipts and $1.977 million in revenue-sharing payments to the city.

“This report is presented in direct response to city council and community concerns regarding maximizing the Greek Theatre’s annual revenue,” the department’s staff report read. “The department of recreation and parks recommends operating the Greek Theatre as an open venue for a minimum of two years to evaluate and analyze projected increased annual revenues while providing sufficient time to receive ample and meaningful community input should a decision be made to issue a new request for proposals (RFP).”

Nederlander Concerts currently operates the Greek Theatre, and has done so for decades. Its contract with the city expires on Oct. 31.

Two bids emerged from an initial RFP process: one from Live Nation and one from a partnership between Nederlander and AEG. The two bids were weighed by a third party consultant, which ranked the Live Nation bid the highest. The bids were for a 10-year contact, with the possibility of two five-year extensions.

In October 2014, the RAP Commission chose the Live Nation bid. In January, the Los Angeles City Council’s Arts, Parks, Health, Aging and River Committee rejected the recommendation of Live Nation due to community outcry. In February, the full city council concurred with the committee’s decision.

With the Nederlander contract finishing Oct. 31, the RAP staff began to push for an open venue model, similar to how Red Rocks Amphitheatre is run in Denver, Colo.

Promoters would work to secure event dates through the RAP department, and a user agreement would denote the responsibilities of both parties. The promoter would generally be responsible for paying talent, advertising, promoting the concert, hiring stagehands, equipment loading, paying for security and hiring ushers.

“In the open venue model, the department will not take the risk of the success of a concert or event, but will be paid a fee for the rights to use the venue,” the staff report read.

By cutting out the professional venue operator, RAP staff estimated the profit to the city in 2016 could total approximately $3 million for 50 events or $4.8 million for 70 events. Some of the profit would be put into a capital improvements fund for maintenance and needed renovations.

The department would examine creating staff positions including Greek Theatre manager, operations manager and booking manager, and it would evaluate companies to provide “as needed” labor services.

“RAP is committed to ensuring that a strong relationship exists with the community and will dedicate a staff member to the management team as the Greek Theatre Community Liaison,” the staff report read. “This department will always be the caretaker for the Greek Theatre, and RAP takes this responsibility seriously.”

Community members and current operator Nederlander expressed their concern about the direction the department has taken on the issue.

“Nederlander is disappointed that the board of recreation and parks has accepted the recommendation to self-operate the Greek Theatre,” Nederlander CEO Alex Hodges said in a statement. “Nederlander has successfully operated the iconic Greek Theatre for four decades, with a proven track record of ensuring the safety and wellbeing of our fans, community and the city. If this plan is to be implemented, it would require several more steps by the department. We urge the department to reconsider today’s action and instead amend and extend Nederlander’s existing Greek Theatre operating agreement with an increased annual minimum rent guarantee to the city of $3.5 million for 2016, with zero expense or risk to the city. This is the most fiscally responsible and seamless option for the city, backed by an operator with expertise in concert booking, management, promotion and community relations. Nederlander is committed to the legacy we have built with the department as a loyal tenant that works in partnership with its community and delivers guaranteed returns to the city.”

Residents of the Los Feliz Improvement Association also rejected the notion of the parks department running the Greek Theatre.

“We’re opposing it officially,” said Chris Laib, president of the Los Feliz Improvement Association. “It’s really too bad that this Greek issue has pitted us against one of our long time partners in the parks department.”

Laib said residents were angry that the parks department might hire new people to help operate the open venue, when neighbors have been asking for funding for more park rangers for years.

While the city council previously had the opportunity to reject Live Nation’s bid to become the Greek Theatre’s operator, it may not be able to intervene this time.

“I care a great deal for Griffith Park and all park facilities from the Los Angeles Zoo, the Griffith Observatory, to the Greek Theatre,” said Councilman Tom LaBonge, 4th District, in a statement. “The department of recreation and parks maintains and operates more than 400 sites for recreational use which include swimming pools, recreation centers, public golf courses and programs for youth and senior citizens. I want to be certain that the department will be able to serve these existing facilities, as well as run a theatre. Therefore, I will be asking the city administrative officer (CAO) to provide recommendations to fully assess this decision.”

“Today’s action, which is a proposal to self-operate the Greek Theatre under an open venue model is not a contract, so it would not require council approval like the potential 20-year RFP that was recently issued,” said Frank Mateljan, spokesman for the Los Angeles City Attorney’s Office.