[Stevie's concert was one of the ones where no amount was listed as being paid for use of the stadium]
Loophole lets celebrities dodge Pittsburgh entertainment tax, audit finds
December 16, 2015 12:00 AM By Mark Belko / Pittsburgh Post-Gazette
http://www.post-gazette.com/local/ci...s/201512160105
Kenny Chesney and Taylor Swift both played to big crowds at Heinz Field in 2013. But what they paid for use of the stadium ended up being as divergent as their audiences.
While Ms. Swift paid $70,411 based on the 3 percent facility usage fee levied by the city, Mr. Chesney forked over a mere $131, according to an audit released Tuesday by city Controller Michael Lamb.
The 3 percent fee is paid by non-resident entertainers, performers, athletes and other for-profit users of Heinz Field, PNC Park and Consol Energy based on the person’s salary for the time they are in the city.
Mr. Lamb’s performance audit regarding the direct revenue received by the city from the sports venues found big discrepancies in the amounts paid by the performers who played at those facilities, and at Mellon Arena before it closed, between 2009 and 2013, the period measured.
The controller suspects that some performers have “found a way to say I didn’t make any money that night.” In some cases what entertainers reported as income in a performance ended up being “significantly less than what we see from the gate,” he said.
While the audit concluded that the properties owned by the Pittsburgh Sports & Exhibition Authority and the city Stadium Authority have generated $107.2 million in taxes and fees for the city over the five-year period, the disparities related to the facility usage fee stood out.
For instance, during Consol Energy’s first year in 2010, Paul McCartney paid $75,000 and $57,329 in usage fees in his two performances opening the arena, while Lady Gaga ponied up $22,571 for her show, the Eagles $11,273, and Justin Bieber $16,333. The Trans Siberian Orchestra paid $704 and the Harlem Globetrotters $102.
At Heinz Field in 2011, Ms. Swift paid $63,486, while Mr. Chesney forked over $135. U2 paid $26,855.
In other cases, no payment was listed by a performer’s name. Such cases included a Bob Seger and the Silver Bullet Band 2011 Consol show, a Rod Stewart and Stevie Nicks 2012 show, and a Barry Manilow 2013 performance.
Mr. Lamb’s office called on the Peduto administration and city council, which had requested the audit, to make closing the loophole “a top priority,” saying it is costing the city thousands of dollars. But how performers take advantage of the loophole was unclear.
“It’s just a loophole we’ve got to find a way to close,” Mr. Lamb said. “What we know is that we’re getting less from one-time performances than we expected and we think it’s because they’re taking advantage of the loophole.”
One recommendation is for entertainers to obtain local tax ID numbers so the city can work more directly with them to collect taxes rather than their management companies. It also recommended that performers pay a penalty if payments are not made within six months of a performance. In some cases, the city would receive tax payments several years after the entertainer performed, the city’s finance department told auditors.
Overall, the audit found that the sports facilities had generated $107.2 million in amusement, parking, payroll, earned income and real estate taxes and usage fees over the five-year period. Federal, state and local funding for the venues and the David L. Lawrence Convention Center totaled more than $800 million.
Mr. Lamb said the city had benefited from the construction of the facilities given the amount of revenue they generated and that city contributions to the projects were minimal.
“Some may argue whether it’s a good deal for county taxpayers or state taxpayers, but for the city itself it’s been a very good deal,” he said.