Second Clause in Contract Causing Consternation – Elections May Force City to Go Ahead with Promoter

Another clause in a music festival contract is proving problematic for city officials. It’s now common knowledge the contract for the promoter hired to put on the event says he is under no obligation to actually make the event happen. Now another clause in the contract is proving equally problematic as those same city officials worried about reviving the twice canceled music festival and setting a new date.

According to the non-competition clause, if the city terminates the contract with the promoter, Tony Clarke and Tresed Ventures, the city agreed not to enter into another agreement with any other entertainment production company for one year after Clarke’s contract is terminated.

Clarke’s contract expires June 2011. Unless Clarke agrees to change the non-competition clause, the soonest another music festival promoter could start work on a rescheduled event would be June 2012. A new promoter will then need time to prepare for the event, with estimates ranging from six months to a year.

Problems with the music festival first surfaced when Clarke was not able to put on the event as promised and the event originally announced for October 9-10, 2010 was canceled causing a slew of alarming stories in The Desert Sun daily paper and television news broadcasts.

After the event was canceled by city manager Rick Daniels the public learned Clarke has no prior experience putting on a music festival, his company Tresed Ventures was formed just three months before entering into the agreement with the city and a suite Clarke listed as his business address in prestigious Marina Del Rey, CA turned out to be a post office box at a UPS store in that city. It was only then City officials looked at Clarke differently.

“Mr. Clarke, I’ve lost total confidence in you. I believe the city should, post-haste, dissolve any relationship we have with you,” said Desert Hot Springs City Council Member Karl Baker at a council meeting in January where Clarke was present and Baker likened Clarke to an emperor with no clothes and called for canceling Clarke’s contract.

For three weeks the city council has been meeting in closed session discussing litigation against Clarke for recovering $250,000 the city paid Clarke. It is not known how much if any money is left. They met again this week for the third time.

City Manager Rick Daniels and City Attorney Ruben Duran have come under increasing pressure over the music festival problem. Daniels and Duran prepared Clarke’s contract presented to the city council. Baker called for a review of Duran’s contract, saying Duran failed to advise the city council that Clarke’s contract did not require him to actually put on the event.

The city council is also under pressure because elections will be taking place in November 2011, just eight months away. An inability to hold the event in October 2011 due to Clarke’s non-competition agreement may force some members of the council to push for continuing with Clarke as the promoter in order to put on some kind of show even if it is poorly promoted and poorly attended.

Signs of that thinking have surfaced in the last two months. One suggestion for making it viable was announced by City Manager Rick Daniels in early January that he was hiring retiring Desert Hot Springs police Commander Ed Smith to manage the event as a consultant. Smith was to be paid just short of $5,000 per month over six month. Pressure for the city to not throw away more money forced Daniels into dropping that suggestion.

Since then, Smith announced at a February council meeting that he was hired by Clarke. Smith said most of his experience is in law enforcement but that he does have some kind of experience with a music festival in Monterrey, California. Smith has not yet provided details of that experience.

“Between wanting to do something and actually making the move to do it involves go-and-no-go steps. That did not happen. I am being asked again what should happen with the festival and one consideration must be if the music festival, as proposed, is viable,” said Councilman Russell Betts.

When asked if he thought Smith could salvage the music festival, Betts said he has asked to see details of Smith’s music promotion background and can’t form that opinion until he does. “Due diligence is required of anyone involved. The same questions apply now that should have been asked at the outset.”

Even before the recent problems over Clarke and his contract, the music festival was a contentious item. It was only approved on a 3 to 2 vote. Betts and Baker voted against the music festival. Mayor Yvonne Parks and council members Scott Matas and Jan Pye all voted yes.

In the upcoming November 2011 election, Parks, Baker and Betts face re-election.