Debate at the La Grange theater: “socialism” or good business?

LA GRANGE, IL – La Grange Theater received support this week in its appeal for the village’s help in its plan to hand over the operations of the theater to a chain.

The theater owners are asking La Grange to forgo $ 1 million in village loans in its plan to let the classic cinemas in Downers Grove run the theater.

At Monday’s village board meeting, administrators said the owners had softened the proposed deal by offering to share a portion of the theater’s profits, which an official said could amount to a half a million over a decade.

During a public intervention, the wife of one of the directors denounced a loan cancellation agreement as “corporate socialism“. But her husband and some of her colleagues were open to a new arrangement.

A dozen years ago, the village struck a deal with theater owners John Rot and Dan Chopp to use the District’s Tax Rise Funding money, or TIF, to help with theater renovations. . Under the agreement, the company does not have to repay the money as long as it remains a theater.

The theater has been a second-run venue, meaning it is unable to show films that have just been released. It is hurting the business, the owners said.

The owners said Classic Cinemas’ relationship with movie studios will bring films into first-run, thereby increasing revenue. The theater has been closed throughout the pandemic.

“The sub-leadership model is dead, and this theater and our business plan has always been a sub-theater,” Rot told the village board. “It’s really a community asset. We really want it to be a win-win.”

Classic Cinemas, which operates 15 theaters in Illinois and Wisconsin, plans to invest at least $ 1 million in theaters. The chain wants to install heated and reclining seats and increase the number of auditoriums to five, from four currently.

The changes will significantly reduce the number of seats. But Chris Johnson, CEO of Classic Cinemas, said he expected ticket sales to increase despite fewer seats. At the chain theater in North Riverside, it cut seats by two-thirds, but saw its income triple, he said.

During a public intervention, Kristen Gale, wife of administrator Lou Gale, said she enjoyed the cinema. But she opposed the cancellation of any loan.

“I am here to tell the board of directors that I am against any agreement for the cinema which does not recover the taxes which were paid to it in exchange for an agreement according to which it would continue as a cinema,” he said. she declared. “I’m here because I’m against corporate socialism. By that I mean a tax cut to keep a business going, privatize profits while imposing losses on the government, that is, to me the taxpayer. “

She said the board should not be supporting any deal that ends up being a donation to a company.

“If that means no theater, so be it,” she said. “It’s capitalism.”

She was the only person during the public comments to take that position.

Administrator Beth Augustine said the proposal was not “corporate welfare”. Over the years, she said, the village has effectively used its TIF to improve the town center, which she said looked “run down” years ago.

“Real estate agents were around downtown for many years. They didn’t want their potential buyers to see what our downtown looked like,” Augustine said. “Those of you who have moved here in the past 15 years cannot imagine this.”

She called the theater “a one-of-a-kind business.”

“The theater is special. He’s a driver. He supports all businesses. People will eat, drink and shop before or after a theatrical experience,” Augustine said. “The goal was never to get the money if it was kept as a theater.”

Administrator Shawana McGee agreed. A longtime resident, she said she and her family had been going to the theater for years.

“No matter what, we’re going to have someone disappointed,” McGee said. “I would hate if we took this kind of opportunity for granted. Our theater plays a very important role in our community.”

Administrator Gale said he didn’t want to privatize profits while the public paid the costs. He said he agreed with the idea of ​​removing the privileges on the property and sharing the profits with the theater. But he said he feared that if the village removed the privileges, the theater would close five years later.

“The theater is this quasi-public good. It is a private entity managed by a private company, but it is also an economic engine for the village, so it is in this strange environment. How do we value that?” he said.

Village president Mark Kuchler said the village wanted to keep the theater.

“There is no other use for this building than a theater,” he said. “The money that will be generated if we reach a compromise will go to economic development. This will support keeping the downtown core in the great destination that it is. We want classic cinemas to be phenomenal success.

The council took no action on the theater. Kuchler said the council would continue to look into the matter. He did not set any deadline for a vote by the board of directors.

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