Wheaton considers financial support for theater
Before agreeing to become a financial backstop for a proposal to reopen the historic Wheaton Grand Theater, the city might want a revenue guarantee of its own.
Among other options, the city could impose a tax on ticket sales in the event the theater reopens, according to a report issued Friday.
Wheaton Park District has asked the city to support its plan to take ownership of the downtown theater and borrow $19.3 million to renovate and expand it. That request for assistance would include helping the park district repay the 20-year loan if the theater doesn't meet revenue projections.
Specifically, the park district wants both the city and Downtown Wheaton Association to provide financial backstop payments of up to $250,000 a year in case the theater fails to raise enough cash for the loan payments.
But Mayor Michael Gresk said he has "a real concern" about spending general revenue tax dollars on something that isn't a core service.
"If they are looking for backups from the city, I really question whether that's part of our function," he said.
In the report issued Friday, city staff said Wheaton's general fund is under "significant financial stress," adding that the city is expected to remain "financially challenged" for several years.
One way the city could avoid dipping into its general fund for the payments is by taxing ticket sales at the Wheaton Grand.
The specific fee would have to be determined. But if a $1-per-ticket fee were imposed, officials say, it would generate $300,000 a year based on the theater's projected annual ticket sales.
On Monday night, city council members are expected to decide what actions, if any, the city will take regarding the 84-year-old theater along Hale Street.
The council also must decide whether it will consider extending the life of a special service area that's the main source of revenue for the Downtown Wheaton Association. The association can't provide financial support for the theater unless the special service area is extended for an extra 20 years.
The group also wants the district's boundaries - roughly bordered by Illinois, West and Wesley streets and Naperville Road - expanded to include the former Hubble Middle School property and Central Park site.
While association officials say they believe property owners within the district would be willing to continue paying the annual fee if it results in reopening the theater, a public hearing would be required to collect feedback.
If all the pieces fall into place and the theater renovation becomes a reality, park district officials say the Wheaton Grand, which is being used part-time by a church, could open for live performances by the end of 2011. Supporters say the theater could become "an engine for economic growth" downtown.