The Arrogance of Summerfest

It was back on March 17 that Milwaukee Journal Sentinel columnist Dan Bice reported that the compensation of Summerfest executive director Don Smiley had ballooned from $280,000 in 2005 to $772, 575 in 2011. That is completely out of line with salaries paid in the past to Summerfest directors, I noted in a column.

More striking than that was the attitude of Summerfest officials, who basically suggested this was none of the public’s business. Smiley himself was even more outrageous, sending a pugnacious email to WTMJ radio host Gene Mueller saying “We receive -0- tax dollars and I’m not an elected politician. So……who cares what the Board decides to pay me or anyone else?”

As I noted in my column, Summerfest is a tax-exempt non-profit that is required by federal law to disclose its financial details, including Smiley’s salary.  Summerfest has also benefited from various subsidies from the city, including $25 million in revenue bonds, a lower-than-market price for the 78 acres in city land it uses, and untold millions spent over the years to build the facilities and improve the grounds of Summerfest. In the 1980s alone, the city created a TIF plan that spent $42 million on Summerfest.

Last week Mayor Tom Barrett and his chief of staff Patrick Curley met with three board members of Summerfest: board chair Ted Kellner and board members H. Carl Mueller and Dan Minahan, who is immediate past chairman.

“It was a pretty good meeting,” Curley says. “The mayor was frank about his concerns that his appointment to the board didn’t know about the compensation for Smiley.” (Smiley’s raises, as Bice reported, were passed by a small committee of the 26-member board.)

Barrett made it clear that such information must be shared with the public appointees to the Board. The mayor, Common Council president and Milwaukee County Executive all have appointees to Summerfest’s board of directors.

“They agreed with this,” Curley says. “They also agreed that (City Comptroller) Marty Matson could come in and look at the books.”

That seems like a no-brainer. This isn’t the Kremlin, but a tax-exempt, publicly subsidized non-profit that also gets many millions in charitable donations.

As the comptroller is independently elected, it’s up to Matson if he wants to do a fiscal analysis, but it’s clear the mayor’s office will urge him to do so. The Common Council may also have an opinion as to whether this is needed. “Given the public interest in this issue,” Curley notes, the comptroller should consider taking action.

Curley also says that in the fall, after the festival season is over, board members agreed to a discussion to “revisit the lease” Summerfest has with the city. Sources tell me the mayor is likely to ask for a higher contribution to the city for Summerfest’s use of city land and city subsidized facilities.

Absent the massive raise for Smiley, I suspect city officials might never have asked to revisit the lease.