Bloomington looks to clarify amusement tax after Tailgate and Tallboys confusion

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Bloomington leaders are looking to clarify when the city should impose its 4% amusement tax, amid confusion as to whether that should include the Tailgate and Tallboys country music festival.

The Bloomington City Council voted Monday for an ordinance change that clarifies the city’s amusement tax only applies to events happening solely within city limits. For events that occur in both Bloomington and Normal, the amusement tax would not apply.

Tailgate and Tallboys proves it’s an important distinction.

The inaugural Tailgate and Tallboys festival brought 37,000 people to the Interstate Center in 2022. That location (also known as the McLean County Fairgrounds) is unique because it straddles the invisible line that separates Bloomington and Normal. The main stage was located on the south end of the property in Bloomington, and other parts of the festival were on the Normal side.

That changed when Tailgate and Tallboys returned for Year 2, from June 14-17, 2023.

The main stage was moved about 120 feet to the north, just across city limits into Normal. The festival’s organizers, West Peoria-based USA Concerts and Events, told WGLT and city and town leaders that that was done because they needed more production and logistics space for big headliners such as Nickelback. Municipal tax code suggests a potential financial motive too: Bloomington has the 4% amusement tax, and Normal does not.

Wayne Klein, president of USA Concerts, denied that was why they moved the bulk of the festival’s footprint into Normal.

“That had nothing to do with it,” Klein told WGLT. “(The) only reason was room for the back stage. Had nothing to do with the City of Bloomington or Town of Normal.”

Change of plans

The move northward was apparently a late change.

Bloomington learned in early May that USA Concerts wanted to move more of the festival northward in Normal. USA Concerts said that was “due to their having been informed that the two headlining bands on Saturday of the festival would be bringing in a total of 23 semitrailer trucks. They said this was the reason they were moving north,” city spokesperson Katherine Murphy said.

Klein confirmed that. He said headliners like Nickelback – which he said travels with eight tour buses – need a lot of production space.

“For me, to move the footprint was a total pain in the butt. I didn’t want to do that,” Klein said.

The city’s 4% amusement tax applies to various forms of entertainment, like live performances, sporting events, or video streaming, with some exceptions for charitable groups and other special situations. It requires “4% of the gross revenues resulting from each amusement” to be paid to the city.

The city council made two changes to the amusement tax code in 2022, primarily to clarify how it applies to streaming and digital content, Murphy said. The city sent a reminder to all liquor-license holders in December 2022 that the amusement tax might apply to them. (For this year’s festival USA Concerts secured a liquor license from both Bloomington and Normal by partnering with the Nashville-based nonprofit Creativets.)

In January and again in March, city staff sent emails to Klein notifying him of the amusement tax, according to emails obtained by WGLT through a records request.

“The city’s 4% Amusement Tax will need to be collected/paid by your Company for events held within the City’s jurisdiction,” a city tax specialist wrote to USA Concerts on March 29. Klein replied to the city staffer April 2 and asked for a meeting to “explain our unique situation.”

Klein told WGLT they did discuss the amusement tax, and he said he was confused as to how he could apply it to his festival, given that its 2022 footprint was technically in both communities, with concertgoers spending money in both communities.

“That’s very strange. It’s very hard for me to know how much I’m supposed to pay,” Klein said.

In early May, Bloomington officials learned the festival’s main stage would move to Normal, the city spokesperson said. Klein said that’s when the artists’ production and space needs became clear.

Klein acknowledged that he did the math and determined that moving the stage slightly to the north could save the festival and attendees over $100,000 in amusement taxes. But he reiterated that wasn’t why they moved the main stage. That was “1,000%” because of production needs, he said.

Festival to return in 2024

USA Concerts didn’t have to pay the amusement tax in 2022 either. It’s unclear why. In response to WGLT’s questions about the festival’s tax situation, a city spokesperson said:

“Due to the event being in multiple jurisdictions, it is difficult to determine the precise amount of amusement tax owed and to verify its applicability. No amusement tax was collected from the event last year and the ordinance being brought forward at (Monday’s) City Council meeting, if approved, will clarify no amusement tax is owed,” the city spokesperson said.

Council members did approve that change Monday. The agenda item did not mention Tailgate and Tallboys by name. Information provided to council members ahead of the meeting said only that “the application and enforcement of the amusement tax becomes difficult to administer when a musical performance takes place in multiple jurisdictions as is often the case at the McLean County Fairgrounds.”

“There should be no material financial impact associated with the proposed change to the City Code. There are only limited circumstances where a performance would physically extend beyond the city limits. Historically, this has occurred at only the McLean County Fairgrounds and due to the complexity in administering the tax in such a situation, no amusement tax has been collected,” city staff wrote in their memo to council members.

To be sure, any amusement tax revenue gained or lost is likely dwarfed by the broader economic impact of the festival on Bloomington-Normal. The 2022 festival brought an estimated economic impact of around $2.1 million, according to the Bloomington-Normal Area Convention and Visitors Bureau. A 2023 estimate was not available.

Klein said 2023’s event was well-attended too, with 10,000 to 12,000 people on Thursday, 12,000 to 14,000 on Friday, and 14,000 to 16,000 on Saturday. And the 2024 dates have already been announced: June 12-15.

“We’re here to stay,” Klein said. “The community’s been totally supportive.”

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