A First Response to Mayor Fulop’s AEG Announcement

Mayor Steve Fulop of Jersey City announced today that he’s picked AEG-a huge commercial promoter-to run the Loew’s instead of Friends of the Loew’s.

As reported in the Wall Street Journal, Mayor Fulop’s plan envisions handing the Loew’s over to AEG in a 30 year lease.

Also as part of the deal, according to the Journal, taxpayers will foot most of the bill for $30 to $40 million of renovations to meet AEG’s needs.

In other words, the RFP process that the City Administration announced months ago as an innovative new approach for the Loew’s comes down to this: Jersey City will pour tens of millions of dollars into the Loew’s in order to let a major corporation try to make money for itself here.

This hardly seems like the approach a progressive administration would embrace.

It is, to say the least, ironic: For ten years, the City government has failed to keep its commitment to FOL to provide the few million dollars needed for the renovations to bring the Loew’s into compliance with the City’s own building and fire safety codes. Had the City provided this money, it was to be paid back through a special surcharge on tickets. This failure by the City to keep such a modest commitment has been the major roadblock in FOL’s efforts to greatly expand programming; it has certainly stopped us from working with major promoters.

Under the plan, the City’s modest show of support would have put FOL in the position to seek grants and major donations to help pay for additional upgrades to the Loew’s. Instead, the City’s failure to keep its commitment undercut our ability to seek such funds. Who would even consider giving money to a building owned by Jersey City but for which the City was refusing to pay for such basic repairs?

The Fulop Administration has ignored what the City has not done and tried to imply that FOL has somehow failed to do what we were supposed to. But now, the City is admitting it will take tens of millions of taxpayer dollars before anyone else can do anything here at the Loew’s.

If the City is finally willing to invest some money in the Loew’s, it would be far more prudent and progressive for it to work with the local community based organization that has so far managed to keep the Theatre open and operating without the City’s promised support .

This, of course, is the latest development in an ongoing struggle by FOL to prevent Jersey City government from turning its back on the ideal for which the Loew’s was saved: our iconic landmark theatre restored as a true arts center that’s rooted in our community.

Friends of the Loew’s has always said that big pop concerts need to be a part of programming at the Loew’s — but in a broader mix of local arts, film, community service events and more. No matter how much our local officials want to convince themselves otherwise, you can’t sustain local roots and broad programming by putting a commercial promoter in charge.

FOL remains confident of our legal position in a longstanding agreement with Jersey City to manage the Loew’s, and so though no one likes to go to Court, we are pursuing a defense that will include an appeal of a recent decision.

But while we leave legal issues to the lawyers, we also want to make sure people know what’s going on and what the issues are.  We’ve encouraged a lively discourse about the fate of the Loew’s on our Facebook page, in Twitter, and through a special website we set up to keep people informed:  friendsofloews.com.

As the City tries to push ahead with its effort to get rid of FOL, it’s more important than ever for people to understand what’s at stake.

We’ll be posting more in the coming days, and so we urge you not only to subscribe to our social media updates, but also to share our postings and messages with your friends and followers. It is important to spread the word.

An Update on the Situation Between Friends of the Loew’s and the City of Jersey City

Mayor Steven Fulop is continuing his attempt to force Friends of the Loew’s out of our role of managing the Loew’s.

According to the Mayor, the City knows what’s better for the Loew’s: he wants to give the Theatre to a for-profit promoter (picked by a committee the Mayor appoints) to run it mostly as a pop concert venue.

In recent statements, Mayor Fulop gives FOL a back-handed compliment for our early work to save the Loew’s. But he goes on to spin out a narrative that depicts FOL as inept and having failed to do what we are supposed to do in running the Loew’s. He even says FOL is being selfish and acting against the public good.

None of this is true.

Still, the Mayor’s complaints should be thoroughly rebutted, so FOL has created a new website just for this purpose with a lot of info, Q&A’s and even a forum: www.friendsofloews.org. We’re adding more to it regularly, so we hope you’ll keep checking it out.

But the most direct way to correct the Mayor’s misimpression that FOL is somehow acting against the public good and has not done what it is supposed to do is to invite everyone to read the Lease of the Loew’s from the City to FOL. We’ve put it online at the new website, right here.

What Mayor Fulop never says is that the Lease is not just about control of a piece of real estate. It’s a plan that FOL and the City have jointly agreed to, almost a partnership, in which the City acknowledged the need for it to do certain things that would enable FOL to expand programming and grow the Loew’s into a fully operational arts center. And in turn, FOL committed to work toward a set of goals once the City had done what it was supposed to do. The goal is to create a multi-faceted arts center like the ones in New Brunswick, Atlanta, Columbus, Schenectady and many other cities.

Here’s a quick background about the Lease: Even though FOL’s program of volunteer repairs had made it possible to use the Loew’s on a limited basis by the end of 2001, there was more work to do before the Theatre could operate on a regular, sustaining schedule like other arts centers, and this work could not be accomplished by volunteers alone.

The most critical of this work was needed to comply with fire and safety codes — things like sprinkler and smoke-detection systems, emergency lighting and fire escapes. But the Loew’s also needed a whole new air conditioning system. And even though we had gotten most of the Theatre’s vintage 1929 stage lighting working, it was woefully inadequate for modern productions.

At first, the City didn’t understand any of this and pressed FOL to host more and more events regardless. To meet this demand, FOL expanded our program of volunteer labor into operations (since a paid staff was unaffordable with the very limited use that the Loew’s could support). We began our classic movie screenings and tried to work with anyone who was interested in putting on a show, but it soon became apparent that most commercial concerts weren’t possible in the Theatre’s condition.

By 2004, the City finally seemed to understand that more had to be done before the Loew’s would be ready for full operation. As a result, the City agreed to Lease the Loew’s to us. READ THE LEASE HERE

In the process of writing the Lease, both FOL and the City agreed that it was better for Jersey City and also the long-term well-being of our landmark Theatre to operate the Loew’s as a multi-faceted arts center rather than just as a concert venue, and the goal was to enable FOL to do that. It’s important to understand that the City did this in full compliance with State law that allows a city to lease property to a non-profit corporation to achieve a public purpose. Here’s an excerpt from the Ordinance passed by the City Council and signed by the Mayor that established the Lease ten years ago:

WHEREAS, Friends of the Loew’s Inc. is a non-profit organization of the State of New Jersey, whose corporate purpose is to provide the following services: Renovate the Property in accordance with the Construction Code, and operate and maintain the Property as a multi-cultural arts and entertainment center, and

WHEREAS, the Municipal Council finds that such services constitute a public purpose that “promotes the health, safety, morals and general welfare of the community;” and

WHEREAS, it is in the best interest of the City of Jersey City to enter into a lease with Friends of the Loew’s, Inc. . . .” 

With an official City ordinance saying all this, it’s hard to understand how Mayor Fulop can argue that FOL is being selfish and not acting in the public good?

But what about the Mayor’s suggestion that FOL has failed to do what we are supposed to? In the first pages of the Lease, the City expressly acknowledged : “the current arrangements limit FOL’s ability to build on past progress” . . . and that “expanded operations of the Loew’s will immediately require that the Theatre be brought into compliance with relevant building and fire codes.”

And a few pages later, the City agreed to support use of Urban Enterprise Zone money it had on account with the State to make those critical repairs, and to find alternate funding if UEZ moneys were not available. The City also promised UEZ funding to help FOL retain expert arts-management consulting to help us refine business plans for the expanded operation of the Loew’s.

In return, FOL agreed in the Lease to apply to Hudson County for a grant to pay for a new air-conditioning system. We also agreed to pursue a list of goals and benchmarks for the Loew’s once the City had provided the funding for the code-related repairs and the planning. And there was an underlying understanding to the Lease that City support for the Loew’s and FOL’s mission would create the strong base FOL needed to begin to seek private donations and grants for additional upgrades to the Theatre — starting with the need for new stage lighting and sound equipment.

All together, the Lease created a balanced, reasonable plan to build on what FOL had already accomplished and grow the Loew’s into a fully functioning, mutli-faceted arts center for Jersey City.

So what happened?

FOL did win a $600,000 grant from Hudson County for air conditioning. (And later, we won an additional $187,000.) We held a fundraising kick-off event. And we gave the City draft applications to the State for UEZ money for the code-related repairs and planning. But the City stalled on submitting those applications. And then … barely a year after signing the Lease, the City tried to claim it was not valid!

Four years of legal wrangling followed, wasting FOL’s time and money on lawyers’ bills. Meanwhile, the City made no effort to secure the money it had pledged for the code-related repairs or planning. Finally in 2009, the City acknowledged that the Lease was valid after all, and recommitted to finding the funding for the code repairs and planning. In fact, the City actually agreed to provide additional funding.  READ THE MEMORANDUM OF UNDERSTANDING.

Throughout 2010, the City met with FOL repeatedly, but still did not apply to the State to allocate most of the UEZ money for repairs and planning. The City implied it didn’t have enough UEZ money on account. But in late 2010, the State essentially confiscated all unallocated UEZ moneys; Jersey City lost $12 million — more than enough to have taken care of the Loew’s.

After that, even though the City is supposed to look for alternate sources of funding, it has done nothing. At the City’s urging, we got Hudson County to agree to allow its grant money for air conditioning to instead be used to make some of the code-related repairs the City was supposed to fund. Now, unbelievably, Mayor Fulop is refusing to let us proceed with making these safety-related repairs!

If the City had just done what it is supposed to under the lease, by 2008 at the latest FOL would have been in a position to work with promoters like Live Nation, AEG and Bowery Presents to bring in a much more regular schedule of major concerts, and this in turn would have helped support more of everything else at the Theatre.

How has the City’s failure to uphold its end of the Lease hampered FOL’s operation of the Loew’s in practical terms? Most obviously, we haven’t been able to make the code-related repairs that would have allowed the Loew’s to function more fully like other arts centers. We can’t use the 1,000+ seats in the balcony, which is a deal-breaker for booking with many pop concerts and the revenue they would generate. Whenever the Theatre is open to the public, FOL has to pay to have Jersey City Fire Marshalls present — last year alone, FOL paid Jersey City $15,000 for this. That’s a big financial hurdle for many smaller shows. And the need to have Fire Marshalls here also creates a practical limit on the number and variety of activities at the Loew’s. It’s impossible to have Fire Marshalls here every day for hours on end, so FOL can’t create daily recurring programs such as an after-school theater camp that are mainstays at other theatres. And without air conditioning, the Loew’s can’t operate for three months out of the year.

But the City’s failure to follow the plan has created an even more daunting hurdle by making it virtually impossible for FOL to seek major private donations and grants in a fiercely competitive fundraising environment. Who would even consider giving money to our cause when the City won’t even find the money to bring its own building up to its own codes?

In plain terms, the City has left FOL holding the bag having to try to operate a building the City admits can’t be properly operated in its current condition.

But FOL has met this challenge. We created an operating model tailored to the Loew’s current condition. Since we can’t bring in many revenue-generating concerts, we earn badly-needed income by making the Loew’s available for weddings and other events — which is actually something many other theatres do.

We are able to pay two employees and occasional per diem contractors, but have otherwise built a staff of volunteers, the key positions of which are filled by professionals in their fields, including sound engineers, production manager, facility maintenance, stagehands, accountants, and more.

We’ve built a reputation through the region for classic film. We’ve created and co-sponsored signature events such as StageFest, our Volunteer Expo, the Golden Door International Film Festival, Visit Santa, Holiday Concert, Diabetes Wellness Day, and more. We work with local organizations from the Board of Education to NJCU to Art House to bring in programs.

And for the last two and a half years, FOL has been using our own funding to tackle the other big problem that makes it hard to utilize the Loew’s. To date, we’ve acquired over $200,000 worth of modern stage lighting and sound equipment. This has already made it easier for FOL to work with local arts organizations.

In the last sixteen months alone, FOL has hosted some 90 events, from a big pop concert to a stage production by young people.

Bottom Line: Despite the City’s failure to do what it’s supposed to do, FOL did not walk away from the Loew’s. Instead, we are running the Loew’s to the fullest extent it can support as an arts center. And that’s what we are supposed to be doing under our Lease.

So Mayor Fulop is not correct when he claims FOL has failed to do what we are supposed to do. He should be asking how much more FOL could do with cooperation from the City. Instead, he’s trying to use the limitations that the City’s own failure has imposed to try to justify abandoning the goal of creating a fully functional multi-faceted arts center. That is ironic and wrong.

Stay tuned. We’ll follow up with more about this situation in the next few days.