Montgomery County MD Pommels Live Nation Report: Fair Game or PR Run Amok?

The staff of Montgomery County Maryland's County Executive apparently didn't care for the recent Associated Content (AC) article Music Promoter Live Nation's Maryland Concert Hall Plans: Done Deal or Not? Patrick Lacefield, Director of Montgomery County's Office of Public Information, composed a 5 page response to the Live Nation article and asked a member of the Citizen Advisory Board to post it on the author's neighborhood listserve where a link to the article previously had been distributed.

Then Montgomery County's Director of Public Information posted a comment about the article on the author's AC Content Producer (CP) page under his own name. Next, in a move of dubious legality and ethics, someone- apparently either Mr. Lacefield or his staff- signed up "Montgomery County" as an AC Content Producer, describing the functions of Mr. Lacefield's office in "Montgomery County's" biographical profile. New CP "Montgomery County" then posted a comment on the author's CP page alleging that the Live Nation article had errors and did not have accurate information about the project or the process leading to it. This comment requested that "in the interest of fairness" readers access a link to Montgomery County Director of Public Information Patrick Lacefield's 5 page response to the Live Nation article, which he has apparently posted on Montgomery County Maryland's official website as well. You can read it here.

"Montgomery County" designated the Live Nation article author its "favorite," enabling "Montgomery County" to receive notification of every article she publishes.

Is Big Brother watching?

Like any competent writer, the Live Nation article author strives to write accurate articles. So after reading what Mr. Lacefield wrote about the Live Nation article, the author examined the Live Nation article to assess the merit of Mr. Lacefield's contentions. The findings- analyzing Mr. Lacefield's four challenges to the article's accuracy- are reported below.

How will the $8 million in public funding be spent in the Montgomery County-Live Nation-Lee Development Group deal?

Upfront in the second paragraph, the Live Nation article succinctly describes the ownership arrangement anticipated in Montgomery County's deal with multinational music promoter Live Nation: "Montgomery County meanwhile will build and own the venue out of which Live Nation operates if the transaction goes through as planned.[emphasis added]"

Identifying the differences between the now-rejected Birchmere plan and its successor the Live Nation plan, the article reports:

When the Birchmere deal was under consideration, Montgomery County planned to sell the land for the music venue to the promoter. There was also $8 million in public funding contributing to the building of what was to be a privately-owned venue.

The $8 million in public funding- $4 million from the state and $4 million from the county- will no longer be turned over to a private company but will be used by the county itself to fund the building of a concert hall it will own [emphasis added]. Leggett has publicly acknowledged that these changes reflect the comments received by Montgomery County officials from concerned citizens when the Birchmere deal dissipated and when Live Nation submitted its letter of intent proposing a 20 year lease with an option to buy.

Later, the article, again comparing differences between the Birchmere and Live Nation deals, emphasized that the Live Nation deal calls for county ownership: "The County would maintain ownership of the property."

Mr. Lacefield says:

"Gilbert is entitled to her own opinion but, as they say, not her own set of facts. She talks of '$8 million in County and State funds to be turned over to a private entity.'

That's totally false. In fact, Live Nation does not receive a dime in this deal.

The $8 in public funds will construct a County-owned facility..."

Why Mr. Lacefield misstated what the Live Nation article says and attacked his straw man, one can only wonder. This executive level public official specializing in public communications went so far as to use quotation marks, indicating that the information he supplied- She talks of "$8 million in County and State funds to be turned over to a private entity"- appeared in the Live Nation article in those exact words. The article did not contain the quoted phrase. Not only did the article not claim public funds would be turned over to Live Nation, it stated otherwise- that the county would use the $8 million in public funds to construct a concert hall to be owned by the county.

While the land and building would be publicly owned, the primary facility use would be Live Nation's private business operations. Live Nation's operation of a music hall is not a government function but a private business activity.

Where was Mr. Lacefield's and Montgomery County's interest in fairness when Mr. Lacefield commanded the power of the county government to widely and publicly disseminate incorrect information assailing the integrity of a respected county citizen's work?

What land-use arrangement is needed to facilitate Montgomery County's agreement with multinational concert promoter Live Nation?

The land use ordinance changes required to effectuate the Montgomery County- Live Nation-Lee Development Group agreement are pivotal to the deal's survival. Montgomery County does not presently own the land on which the concert hall would be built. The owner, Lee Development Group, will donate the land to the county as part of a plan in which Lee will obtain the right to build a high density hotel and retail complex on the adjoining parcel.

About this plan, the Live Nation article reports:

The plan calls for Lee to donate the land for the Live Nation facility to Montgomery County. In return, Lee will obtain valuable vertical construction rights enabling it to develop a hotel and retail establishment on the remainder of the block that would otherwise violate height restrictions. These development rights are at the heart of the Live Nation deal.

and

Under applicable land use laws, a developer can obtain valuable vertical height development variances for donating land to the County for a public use. Traditionally, the public use is green space which offsets the overbuilding sought by the developer. The rationale behind the green space reservation is to even out the environmental effects of the property use by permanently pairing the overdeveloped parcel with an undeveloped one.

In a novel interpretation of this law, Montgomery County officials will attempt to have a music hall designated a public use. The success of the Live Nation deal depends on this artifice.

...Would interpreting the land use law to embrace this building as a public use vitiate the purpose of the law- letting publicly owned green space offset privately owned superdevelopment? Allowing the overdevelopment of the Lee property while concurrently permitting a high use development of the parcel being donated to the county would seem to not only undermine the regulation but to generate the exact opposite effect of what the regulation intends.

Mr. Lacefield devotes little space in his 5 page response to the Live Nation article to this determinative issue. Instead of addressing how the county is proposing to amend the rules to facilitate the Live Nation concert hall, he says only:

"Gilbert also makes lots of mistakes in describing the land arrangement... The Lee Development Group would donate the land to the County... That donation of land would count as the required "amenity" for a future development that the company would build adjoining the site... Amenities, by the way, are more often paved courtyards, atrium or frontage rather than wooded paths. At any rate, this arrangement would give the Lee Development Group no more density on their site than they would otherwise be entitled to get under what's called the Optional Method of Development."

Mr. Lacefield's claim that the arrangement under which Lee Development Group donates land as an amenity would give that group no more density on their site than they would otherwise be entitled to get under what's called the Optional Method of Development (OMD) is a non sequitur. For the Lee Development Group to use the OMD, it is required to provide a "public facility or amenity." With no provision of a public facility or amenity, Lee Development Group would not "otherwise" be entitled to use the OMD. It would be required to use the Standard Method for determining allowable project density.

A "public facility or amenity" is defined under current land use laws as:

...(a) green area or open space which exceeds the minimum required, with appropriate landscaping and pedestrian circulation;
(b) streetscaping such as plantings, special furniture, bus shelters, benches and lighting;
(c) provision of space for performances, events, vending, and recreation; and finally
(d) dedicated spaces open to the public such as museums, art galleries, cultural arts centers, community rooms, and recreation areas.

The Live Nation article emphasized green space and could have devoted more attention to accepted alternatives including streetscaping and the various public use spaces described in sections (c) and (d) of the definition of a public facility or amenity. Nonetheless, those options are immaterial to an analysis of the issue that may unravel the Montgomery County- Live Nation- Lee Development Group deal.

The Montgomery County-Live Nation-Lee Development Group deal anticipates that Lee will donate land to the county. In exchange, the county will pass a Zoning Text Amendment (ZTA) to enable classification of this land donation as the required "public facility or amenity" that will permit Lee's use of the OMD.

The crux of the issue facing Montgomery County, Live Nation and Lee is whether the donation of a parcel of land adjacent to the proposed Lee complex can satisfy land use regulations. As those regulations stand now, the answer is no- no because current law does not provide for land donations to the county to constitute public facilities or amenities and no because current law requires the donated public facility or amenity to be located on the developer's site.

That is why Montgomery County is proposing a Zoning Text Amendment (ZTA). ZTA No. 07-10 would amend the Central Business District Zone ordinance. But will the County Council approve the ZTA? If so, is the ZTA likely to suvive any legal challenge?

The ZTA contains the following proposed new provision to be added to §59-C-6.23, Development Standards:

"The optional method public use space requirement is satisfied if the applicant conveys to the county an appropriate amount of land or building space for use by an arts or entertainment entity that contributes to the revitalization of a Central Business District. The gross floor area provided for the arts or entertainment area may be excluded from the gross floor area of the optional method project for the purpose of calculating density."

Without this zoning amendment, Lee would not be entitled to subtract the gross floor area of the concert hall space in calculating the density of its adjacent hotel and retail complex, and its project density would not pass muster.

Montgomery County is seeking to amend another section of the ordinance to permit donation of off site facilities and amenities or public use space, since the Lee land will be a distinct parcel from the music hall site if the plan succeeds.

But does the new language, proposed to facilitate the Montgomery County-Live Nation-Lee Development Group deal, fit logically within the contours of the existing Central Business District Zone ordinance?

The public facilities and amenities requirement is intended to satisfy public needs that result from the development project. Whatever public need may be said to underlie Montgomery County's desire to build a music hall in downtown Silver Spring, it requires extraordinary inventiveness to attribute that need to Lee Development Group's proposed hotel and retail project.

The highest hurdle for the Live Nation music hall project, however, is its function. The reason for requiring the provision of public facilities and amenities as a trade off for allowing a developer greater project density is to "make possible the creation of an environment capable of supporting the greater densities and intensities of development permitted." The argument that a 2,000 seat music hall somehow supports the greater densities and intensities of Lee Development Group's proposed hotel and retail complex may be a hard sell for the deal participants when their plan is subjected to County Council approval. The extra demand created by a sizable concert hall designed to accommodate crowds of 2,000 can reasonably be expected to exacerbate any problems created by Lee's superdevelopment, not ameliorate them.

In sum, Mr. Lacefield incorrectly represents that the Live Nation deal gives Lee Development Group no more density on its site than it could otherwise get. The Live Nation article correctly indicated that Lee Development Company would donate land to Montgomery County in return for increased density for its hotel and retail complex.

Before negotiating with Live Nation, Montgomery County had been working on a deal with the Birchmere music hall. How did these negotiations end?

The Live Nation article states:

When the negotiations reached the penultimate stage and the community anticipated announcement of the signed agreement, a sudden reversal occurred.

Initially, there was talk of the deal being scratched over the prospective siting of two dumpsters in an alley behind the music hall. In the face of a community of raised eyebrows, the County quickly changed gears, attributing the breakdown to the alleged failure of the Birchmere to have signed a nonbinding letter of intent at the start of the negotiations. Whatever the real cause, the deal was off. County Executive Ike Leggett announced the impasse in the newspaper. The Birchmere owners said that was the first they heard of the deal's demise. They tried to revive the negotiations but Leggett stood firm and opened negotiations with the multinational company Live Nation, instead.

Mr. Lacefield disputes this description, stating that "at the end of July [emphasis added], the County suspended negotiations with the Birchmere. After five years we still didn't even have a 'letter of intent'... They responded to our suspension of talks with a letter saying negotiations were over. They said that, not the County."

But the local newspaper the Gazette and the Washington Post have both reported otherwise.

On July 26, 2007, the Washington Post reported, "Montgomery County has ended negotiations with the owners of the Alexandria-based Birchmere to open a second music hall in Silver Spring and is considering another operator for the site."

-Harrington, Richard and Spivack, Miranda S., "Birchmere Out in Talks about Silver Spring Music Venue," the Washington Post, July 26, 2007.

The local Gazette reported that on August 27, 2006, 11 months before the negotiations ended, the Birchmere's chief negotiator had provided a letter that appeared to be a letter of intent. That letter opened with "The Birchmere Music Hall is very pleased to advise you of its intention to open a second location on the Lee Development Group site."

-Janel Davis, "The Tale of a Doomed Public-Private Deal," the Gazette, Sept. 14, 2007.

And on July 25, 2007, when the Gazette reported the demise of the Birchmere deal, it quoted Birchmere owner Gary Oelze as saying "As far as I know, we have a deal with the county that we've been working on for five years. As far as the Birchmere's concerned, there are no negotiations that have broken down."

Mr. Lacefield said at that time that Pradeep Ganguly, Montgomery County's Director of Economic Development, had sent a letter to the Birchmere on July 19 [emphasis added] notifying it of the county's intentions to stop negotiations.

-Jasinski, Agnes, "Birchmere Talks End," the Gazette, July 25, 2007.

Mr. Lacefield acknowledged in an interview with the Washington Post on July 26, that the county was seeking a deal with a larger economic impact in ending the negotiations with the Birchmere. Lacefield is quoted as having said, "We are looking for a larger economic impact and we weren't exactly where we wanted to be in negotiations with Birchmere."

-Harrington, Richard and Spivack, Miranda S., "Birchmere Out in Talks about Silver Spring Music Venue," the Washington Post, July 26, 2007.

By late July, the prospect of Live Nation coming to Silver Spring was already being discussed and reported on in both the Washington Post and the Gazette.

The Post noted on July 26 that the site owner and developer Bruce Lee had already commissioned an architect do a test fit for a music hall with capacity to hold 2,000 ( the size proposed by Live Nation.) Lee proclaimed that the expanded capacity would be a boon to Silver Spring.

-Harrington, Richard and Spivack, Miranda S., "Birchmere Out in Talks about Silver Spring Music Venue," the Washington Post, July 26, 2007.

Architectural drawings meeting this description and dated July 16, 2007, indicating that they were being prepared while the Birchmere negotiations were live, were submitted to the county with Live Nation's letter of intent. The county acknowledged in a press release announcing that Live Nation had signed a letter of intent that Mr. Lee had contracted for the architectural drawings to be used for the concert hall site. Yet, Mr. Lacefield indignantly claims in his 5 page response to the Live Nation article, in addressing Montgomery County's reasons for rebuffing the 9:30 club, that the county would never open discussions with a second party when it was already in the midst of negotiations.

Whatever the County chooses to call its mid-July end to the talks with the Birchmere, it was readily apparent when it called off those talks that the County was no longer willing to meet with the Birchmere at the negotiating table. It appears to have been already courting the multinational Live Nation in the hopes of landing a deal with a larger economic impact.

Were Montgomery County Chief Executive Ike Leggett's negotiations with multinational Live Nation secretive?

Reporting on the nature of Montgomery County's negotiations with the multinational corporation Live Nation, the Live Nation article said, "Montgomery County's negotiations with Live Nation were shrouded in secrecy. Leggett conducted the negotiations personally, shutting out input from the members of the county council."

Mr. Lacefield disputes that the negotiations were shrouded in secrecy. He said that "Far from being 'shrouded in secrecy,' the County Executive briefed all Councilmembers individually prior to the county signing a 'letter of intent' with Live Nation, solicited their concerns and met broadly with community people and civic groups to get their feedback- something that was not done in the earlier Birchmere stage. This was one of the most open and transparent economic development projects in the county in recent memory."

Do the Council members share Mr. Lacefield's opinion? Apparently not. Council member Nancy Floreen, who publicly supports the Live Nation deal, wrote this telling email to a constituent on December 4:

"I have received many e-mails expressing opposition to Live Nation, so I know there is a great deal of concern out in your community. I am following the issue closely, but much of what I know I have learned from the newspaper. As you may know, the negotiations are being handled totally by the County Executive, with very little information filtering to the Council, If there are budget implications or zoning changes, the Council will become involved later. Only then can we really have input. But we are not a party to any of the discussions at present."

This explanation illuminated an earlier email exchange between the constituent and Council member Floreen in which Ms. Floreen candidly stated, "No one on the Council is in the loop. This has been a County Executive initiative, and he considers this an Executive function. I and my colleagues are monitoring this as well as we can. There is concern in the community and at the Council, and we are expressing this to the Executive."

The Gazette reported that the Council members were concerned about being kept in the dark and about Leggett's failure to use a competitive bidding process. In a January 30, 2008 article aptly headlined "Live Nation Deal Draws Fire from County Council," the Gazette reported that Council members were accusing the County Executive of negotiating a "back-room deal." Council member Marc Elrich said he felt boxed in and didn't like the feeling. Council member Roger Berliner is quoted in that article as saying, "I do perceive the process used here taints the entire project and makes it difficult for us."

- C. Benjamin Ford, "Live Nation Deal Draws Fire from County Council," the Gazette, January 30, 2008.

In an earlier Gazette article, Elrich had called the process used by Montgomery Chief Exective Ike Leggett to negotiate the Live Nation deal "flawed" and called for open solicitation of bids.

- Ford, C. Benjamin and Hyslop, Marjie, "Some Wonder Whether Live Nation Was Best Deal Possible," the Gazette, January 25, 2008.

While some Council members and citizens embrace the Live Nation deal and others do not, satisfaction with the outcome of the negotiations is a different issue than satisfaction with the process used to negotiate the deal.

This analysis of Montgomery County Director of Public Information Patrick Lacefield's response to the Associated Content article concerning the county's deal with multinational music promoter Live Nation shows his commentary for what it is- intolerance of disagreement and willingness to cast aspersion on anyone perceived to be standing in the County's path to completion of the Live Nation deal- even a member of the public the County is nominally representing in negotiating that deal.