Taxpayers on the hook for canceled Chicago stadium show

The Illinois Sports Facility Authority paid $1.6 million for a September concert at Guaranteed Rate Field, featuring Diddy and Fat Joe, even though it had to cancel the event.

Taxpayers are on the hook for more than $1 million for a September concert in Chicago that never happened.

The Chicago Sun-Times first reported the Illinois Sports Facilities Authority, or ISFA, spent about $1.6 million “toward retaining talent” for a concert expected to draw 30,000 people at Chicago’s Guaranteed Rate Field – which the ISFA owns and operates – Sept. 16. The concert was canceled after the ISFA could only get back $350,000 on what it spent to put on the show.

The Sun-Times reported expenses included contracting Mike Daddy Unlimited “to act as its exclusive consultant with respect to the procurement and booking of all talent and live entertainment.” Mike Daddy Unlimited was contractually obligated to book artists Diddy and Fat Joe and failed to follow through on meeting its obligations, according to an IFSA lawyer.

The situation is a raw deal for taxpayers, who have to foot the bill for an event that never took place. But it is also a predictable outcome of a misguided state priority: getting involved in the construction and maintenance of stadiums and entertainment.

Taxpayers have been paying for Guaranteed Rate Field, formerly U.S. Cellular Field and Comiskey Park, since its opening and still are to this day. The General Assembly and then-Gov. Jim Thompson struck a deal in 1987 to build and fund a new stadium for the White Sox, after White Sox owner Jerry Reinsdorf had threatened to move the team to Florida if he did not get a new stadium. The agreement also created the ISFA – a politically stacked board filled by appointments from the governor – to operate the stadium. The ISFA also went on to oversee the renovations to Soldier Field, home of the Chicago Bears, in the early 2000s, and taxpayers are still picking up the tab for that project to this day.

The ISFA has been a boon for the politically connected. Former ISFA Chairwoman Perri Imer, who served from 2004-2011, claimed in 2013 the ISFA is nothing more than a “cash cow puppet for Jerry Reinsdorf.” And the Soldier Field renovations acted as a “huge public-works project with plenty of hefty contracts for political allies of City Hall and Springfield,” the Chicago Tribune reported in 2002.

Even without its political ends, the ISFA’s results are dismal for taxpayers. And given the ISFA’s track record of burning through taxpayer money with questionable return, it would be wise for Illinois and Chicago to steer clear of the publicly funded stadium racket. But they haven’t.

Wintrust Arena opens in November for DePaul men’s and women’s basketball and for the WNBA’s Chicago Sky in 2018. Taxpayers have put forward $82.5 million for the arena, primarily used by DePaul, a private university with an endowment approaching half a billion dollars. The construction of the stadium also came with an accompanying taxpayer-funded hotel, both located near Chicago’s McCormick Place. The funding plan assumes DePaul will practically sell out all of its home games at its new 10,000-seat arena – a lofty goal given DePaul men’s basketball averaged just 4,900 fans per home game during the 2016-2017 seasons, an uptick from two seasons prior in which it averaged just 2,200.

If the Guaranteed Rate Field and Soldier Field deals are any example, taxpayers are likely to come out on the losing end of the Wintrust Arena boondoggle as well. And there could be more, similar deals to come. Construction of yet another stadium in Chicago has been proposed as part of a deal to lure Amazon to Illinois. While funding details are not yet known, any such proposal should give taxpayers pause, as they will be paying for multiple projects for the foreseeable future.

Taxpayers should be wary when city or state government puts forward public money for entertainment purposes. Considering the financial state of the city of Chicago and the state of Illinois, this is certainly a cost both can’t manage.