WEHOville

This Year’s LA Pride Was $395,000 in the Red

Wed, Aug 10, 2016   By Staff    23 Comments
LA Pride 2016. (Photo by Derek Wear of Unikorn Photography)

LA Pride 2016. (Photo by Derek Wear of Unikorn Photography)

Christopher Street West (CSW), the non-profit organization that puts on the annual L.A. Pride festival and parade, lost $395,000 on this year’s Pride event.

According to a copy of CSW’s 2016 profit and loss statement made available to WEHOville, CSW’s overall revenue was $2.1 million, 30% less than budgeted. Its overall expenses were $2.5 million, 13% less than budgeted. CSW had projected a $162,000 profit.

Major factors in the loss included a 30% shortfall in projected revenue from festival admission tickets. CSW had projected revenue of $1.3 million (44% of the total revenue from the event), but realized only $915,710. Another shortfall was in revenue anticipated from beverage sales, which at $250,000 was down 65% from the $718,000 that CSW had projected.

However CSW did do better in selling sponsorships, with revenue of $800,000 compared to the $700,000 it had budgeted. Sponsors included major brands such as Wells Fargo, Delta Airlines, Nissan and Budweiser. And it realized $93,615 in fees charged to those participating in the Pride parade, compared to the $80,000 it had budgeted.

CSW still has not released its 2015 financials, arguing that they still are under review by its accountant or auditor. And its board of directors did not discuss its financial situation in any detail last night at a meeting at which a reporter and two local residents were present. But at that meeting, board member and former CSW President Steve Ganzell referred to the 2015 Pride festival and parade as very profitable.

CSW President Chris Classen hinted at the possibility of a loss at a community meeting on July 20 to discuss the controversial Pride event but said he wasn’t sure of that.  However the financial document reviewed by WEHOville was dated June 28. Residents and LGBT community members at that community meeting criticized CSW’s efforts to convert the 46-year-old event into a music festival catering to Millennials, its decision to increase festival ticket prices by 40% (later somewhat reduced) and its reduction in events for the lesbian and transgender communities.

Chris Classen

Chris Classen

At its meeting last night, CSW board members addressed some of that criticism, with members generally agreeing to try to work more closely with LGBT community organizations going forward. Much of the conversation also focused on last weekend’s DTLA Proud, the first Pride event in downtown Los Angeles. Some CSW board members noted that DTLA Proud, also a non-profit, had brought together community organizations and bar owners and promoters to stage the event. With the CSW board agreeing to work more closely with non-profit community organizations, long-time board member Ganzell withdrew his proposal to force Classen to step down from his role as president.

Another subject of last night’s meeting was complaints by some board members of a lack of transparency. Andy Sacher, who is founder and CEO of the Lavender Effect, and Karina Samala, board president of the Imperial Court of Los Angeles and Hollywood and member of the L.A. Transgender Advisory Council, said major decisions were being made by only two board members — an apparent reference to Classen and Craig Bowers, who is Classen’s partner in an events business. Bowers responded that board members must be willing to spend more time on Pride planning if they want to know what is going on.

Samala also complained that she has yet to receive information she requested about how much CSW contractors are being paid. Michael Carriere, CSW’s treasurer, said that information is difficult to extract from the organization’s bookkeeping database but that he will make it available to Samala soon. That information, however, is in the profit and loss statement obtained by WEHOville.

It shows that the festival and parade producer was paid $80,000 this year. Jeff Consoletti is the producer of the event, a role he has held for several years. Other contractual labor expenses (the recipients are not identified) are $24,000 for the operations manager for the two and a half-day festival and $17,000 for the event production coordinator. CSW paid $12,500 to an “art and heritage” coordinator. The parade production manager was paid $14,000. CSW does not request proposals from competing outside contractors and generally works with the same ones year after year.

In addition to the $80,000 paid to Consoletti, CSW paid $20,000 to someone to book performers for the event and an additional $44,300 for other entertainment staff. Those contractors were not named in the financial statement.

Other consultants and their fees were Sam Borelli, who was paid $44,000. Borelli, who has served as a consultant to CSW in the past, helped secure sponsors for the event and is likely the recipient of some if not all of $18,000 in sponsor sales commissions listed in the profit and loss statement. Mike Stommel, who has handled publicity for the event in the past, was paid $37,000. And Karan Sharma, who was the sponsorship coordinator and production assistant, was paid $9,000.

The financial statement shows a payment of $5,000 for “government consulting,” which was budgeted at $12,000. That likely is the fee paid to Scott Schmidt, former campaign manager for and deputy to Mayor Lauren Meister, who has met with Meister and Councilmember John D’Amico about the community assessment of Pride that they organized. Schmidt recently ended his contract CSW, citing his concern about the perception of a conflict of interest given his relationship with Meister.

Fees for entertainers totaled $469,753, or 19% of overall expenses, with $4,550 spent on the transgender celebration, $45,925 on hip hop artists and hosts, $52,353 on Latin artists and hosts and $344,950 spent on more general entertainers and hosts.

The financial statement also shows that CSW, which has no full time staff, has spent $6,000 of a budgeted $13,500 to lease its small office at the Pacific Design Center and $30,731 to renovate the space. It spent an additional $4,230 for parking and office utilities and internet and telephone service.

The City of West Hollywood, which subsidizes the Pride event with roughly $500,000 in waived fees, foregone parking meter revenue and some cash, is holding another community meeting to discuss the direction LA Pride should take going forward. That meeting is on Aug. 17 at 6:30 p.m. at the auditorium in West Hollywood Park adjacent to the library.

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23 Comments

  1. James FFri, Oct 14, 2016 at 12:32 am

    I was on the board of CSW for 16 years. I left the board about 2011 as I sensed that there were too many things happening that I felt weren’t right. Many having nothing to do with the finances. Just in the way I was treated by some of the executive board member, one in particular. Bottom line is that I felt it was enough of a struggle to handle the duties of the committee I chaired. I wasn’t getting the support I needed from some members of the executive board and i some cases I felt the one of them was actually conspiring against me as he would lie out of he side of his mouth about many things. I had enough and decided it was time to go. I’m glad I did. Know that many organizations aren’t always up-trending. CSW was in a definite down cycle when I started and reached some amazing heights. My hope at this time is that it is not in a a death spiral but it’s not looking good.

  2. MikeSat, Aug 13, 2016 at 6:42 pm

    I passed on the pride/parade this year due to the shootings in Florida and the news about the guy being arrested in SM with all kinds of guns in the trunk of his car. Moreover, I have grown bored with the whole Pride thing due to its commercialization. West Hollywood is not the Gay mecca that existed when I moved out here in 1978. There is a such thing as too much success. Personally, I have never worried about being “accepted” I just want to be left alone and not hassled for who I am.

  3. SESat, Aug 13, 2016 at 9:37 am

    The main criteria for a Pride festival/celebration should be inclusion and equality. When tickets prices are too expensive for one segment of the population and other segments are marginalized or excluded in order to increase profitability then we have lost our way. That is the true bottom line. There is only shame – not pride – in making members of the LGBT community once again feel they aren’t “enough” and CSW needs to make this the main consideration in every decision they make in the future.

  4. MannyFri, Aug 12, 2016 at 8:01 am

    The article that “Mimi” posted, aside from being too long and boring, has no reference or insight into the problems surrounding CSW and LA Pride in West Hollywood.

    The article does makes arguments for and against the commercialization and corruption of the Gay Liberation Movement, but it offers no further discussion about the other plethora of issues that are specific to CSW……Which is what we should be discussing here.

  5. J SimmonsFri, Aug 12, 2016 at 4:54 am

    I agree with the other rational minded. The Orlando Tragedy must have had a major impact, and going around pointing fingers THIS YEAR DUE TO A TRAGEDY, is disrespectful and shamefull.

    Pride has and will go on FOR YEARS.

    Point Fingers; Blame Whomever …. NEXT YEAR!

    Arguing money and profits when so many innocent lives were so horrificly is just not right, not proper, not civilized, and just olain NOT HUMAN.

  6. Josh KurpiesThu, Aug 11, 2016 at 11:12 pm

    Mimi – Great “The Price of Gay Pride” article! Thank you for sharing!

  7. Proud Supporter of LA PRIDEThu, Aug 11, 2016 at 6:12 pm

    Thank you @Mimi for posting the link to that article before I had a chance to. PRIDE has changed not just in LA but around the world. This should be something that everyone in the community is so excited about.

    “These events really switched from an overtly political stand to one that is more inclusive of lots of people, more embracing of a broader ‘Pride’ agenda — meaning, to feel good about being gay, rather than demanding change.” What was once a “march”, he adds, is now, tellingly, more widely referred to as a “parade”.

    Corporate sponsorship of the world’s bigger Prides is not new. At the archive of the Lesbian, Gay, Bisexual & Transgender Community Center in the West Village, there are old programmes from past New York events: up until the early 1990s, they were populated almost entirely with adverts for adult video stores and Aids medications. But in 1996 Miller Lite beer came on board as a major sponsor. Over the past decade, there has been a significant upswing in businesses targeting these events — and the gay community in general.

    Lets feel good that we are able to rally together and be who we are. Lets stop the arguing and bickering within our community. If we can’t get along within our own community how we do expect the other communities to respect ours??

    “When you’re finished changing, you’re finished.”

    “The art of life is a constant readjustment to our surroundings.” -Kakuzo Okakaura

    “The price of doing the same old thing is far higher than the price of change.” -Bill Clinton

    “Each of us has the opportunity to change and grow until our very last breath. Happy creating.” -M.F. Ryan

  8. MimiThu, Aug 11, 2016 at 1:18 pm

    I think the most important thing to point out is that PRIDE as an institution, as a rallying call for our community, is always EVOLVING. If you look at Pride events from New York City to Rwanda, they are meaningful but different than what many of us remember from the parades and events of the 1970’s. This great article talks at length about how Pride has evolved. I highly reccomend that you read it: http://www.ft.com/cms/s/2/228207c6-5f46-11e6-ae3f-77baadeb1c93.html?siteedition=intl

  9. Jim NasiumThu, Aug 11, 2016 at 6:24 am

    @Let’s Be Honest Here–yeah but weren’t the LED lights cool?

  10. TorresThu, Aug 11, 2016 at 4:44 am

    1.
    DTLA Proud Festival was so much fun!
    2.
    I think LA Pride should move to a bigger venue like downtown and WeHo should create a new city run cozier production.

  11. Let's Be Honest HereWed, Aug 10, 2016 at 10:04 pm

    I’m going to have to rip the accountability and transparency issue reported by the key leaders of CSW to shreds here. It just doesn’t add up and those who run nonprofits correctly smell “bullcrap” all over this. There are too many Red Flags all over this reporting that should give pause to anyone who runs an organization. Let’s start with the public records available on Guidestar on CSW’s profit/losses and expenses for the last six years:

    2011 – $11,071 profit $ 1,596,888 Income $1,575,817 Expenses
    2012 – $70,526 loss $ 1,692,548 Income $1,763,074 Expenses
    2013 – $76.566 loss $ 1,839,918 Income $1,916,484 Expenses
    2014 – $51,612 loss $ 2,348,987 Income $2,400,599 Expenses
    2015 – Tax Form 990 not filed with IRS to date (unavailable to public)
    2016 – $395,000 loss* $2,100,000 Income* $2,500,000 Expenses* (unaudited, rounded figures)

    Red Flag #1: Every nonprofit director/president, mid-size to large knows, who to calculate budget projections based on historical data. When Chris stated at a Council meeting that CSW incurred losses for the last several years. How does the historical data support revenue projections of 2016?

    Red Flag #2: Audited 2015 Statements still being reviewed. The usual practice is that an auditor engagement letter to begin audited occurs shortly after fiscal year end. Most auditing occurs within 6 months after year end with the auditor producing the report within 30 days. CSW has historically filed their IRS 990 forms on the very last possible day for a nonprofit based on their fiscal year, which for CSW is November 15th.

    Red Flag #3: Chris stated he intends to work closer with nonprofits, hence opposition to his being President was withdrawn. How about installing two nonprofit leaders with knowledge in nonprofit governance, transparency and accountability and IRS rules on the board in the October elections? Talk is cheap…show community you mean to listen to the nonprofit community. But one other point, why does a President who created a historical loss more than 4 times the previous years get to be President again? Are we rewarding someone who didn’t prove good leadership skills?

    Red Flag #4: There is too much Conflict of Interest all over the place with CSW!!! Chris and Craig work for the same company and for an event production company? Has any board member signed the IRS required “Conflict of Interest” form? I understand this form has never been presented to any board members which is attested to as being compliant on the IRS Form 990. Wouldn’t IRS find that curious that this was attested to under penalty of perjury?
    Craig and Chris shouldn’t be on the board at the same time considering an appearance of collusion without other board members present in an official recorded meeting while some decisions that were made were in direct violation of the California Corporations Code.

    Red Flag #5: Treasurer, Carrie said that P&L details were not easy to pull from the financials. What a bunch of absolute hogwash! Every bookkeeper program used by an organization is capable of easily pulling this information. I doubt they are using the personal home program Quicken because that would produce records an auditor can use nor produce information to file the IRS Form 990. So the answer given was absolute bullcrap! Period!

    Red Flag #6: I am not even going to comment of the number and amount paid to consultants and the appearance of a conflict of interest issues. However, nonprofits much do their due diligence and ALWAYS place vendors into an annual bidding process. It’s okay to select the same vendor if they meet your standards and needs. But not to bid out vendor items is an absolute failure to remain transparent, remain fiscally responsible and ensure that collusion or inurements don’t occur.

    None of these Red Flags are a judgement about the facility and improvements, the way the event was produced or whether the music festival idea was a good or bad idea. This only speaks to the legal, ethical, transparency, accountability and requirements that all nonprofits are held to. The leadership failed at every level to govern a public trust and in turn the lack of values crept into the production of the event, the inclusion of community in the planning and the distrust earned from forgetting that boards are seated at the center of a organization, not at the top.

    Honest governance of an organization doesn’t need a cover-up. Transparency is your friend.

  12. WayneWed, Aug 10, 2016 at 6:10 pm

    i have attended and enjoyed the CSW Parade and Festival since the early 1980’s. My earliest vivid memories are from 1986. Then, the festival was held in the PDC parking lot when only the blue building existed. it was small, cozy and the attendance was much less than it is now. I remember a disco tent under a small white canopy. I remember porn stars in dunk tanks and other simple pleasures. I remember the parade being as spectacular as it is now.

    Over the years with under the leadership of a wide range of individuals and with the addition of event producer Jeff Consoletti a few years ago, I have seen a noticeable positive change in the overall vibe of the festival. The festival has become exciting, beautifully lit, creative and more. I enjoy the LED uplighting throughout the park. I love the accent of the carnival attraction in the middle of San Vicente, and previous years’ Thunder Ground Roller Skating rink near main stage. I also liked the presence of Abbey at the 2015 festival when they brought a mini-experience of their club to the festival grounds. And let’s not forget the debut of Erotic City Underground (in the parking structure).

    The Main Stage used to be a small venue and now it’s larger with great lighting,visuals and crystal clear sound, not overly loud, but just right. And by looking at the crowd in this venue, the artists that were booked were well appreciated. I will admit, I wasn’t familiar with many of the performers that represented this year’s entertainment lineup, but I still enjoyed myself. .

    The coordination of beverage sales and the elimination of beverage ticket sales lines was a feature in 2015 and at this year’s event. Being able to walk up to a counter and purchase your favorite brew or well drink and ring it up with cash or credit cards is pretty cool…and no tickets. Also, there were plenty of beverage stations throughout the festival site which kept lines to a minimum.

    Also kudos to the nicely produced Latin Carnivale by Club Papi and the R&B dance area. Great sound, visuals, decorations and the like make these areas a lot of fun as well.

    As for the food offerings, I thought the food truck pricing was over the top. I would like to see more of the mom&pop vendors and other offerings that are prevalent at most festivals, including more variety including dessert and coffee options.

    In summary, I support CSW and its production team and hope that they’ll listen to all of the posted comments and news articles and use this information to enact positive changes for the future. As 56 year old man, after participating in the parade starting at 7am, the festival held my interest until midnight. I can’t imagine LA Pride moving elsewhere, but I’m okay with LA Pride being in DTLA while CSW takes on a new name such as West Hollywood Pride.

    There is room for additional pride celebrations, but there is no replacing West Hollywood and the pride celebration that goes with it.

  13. JJWed, Aug 10, 2016 at 1:42 pm

    I agree with 90069

  14. SaveWehoWed, Aug 10, 2016 at 1:03 pm

    I think its interesting to note that alcohol consumption was down, ticket sales were down…while corporate sponsorships were up. Doesn’t that tell you that the lgbt community is just becoming another advertising mechanism with disregard to the real lgbt social issues? This is why Weho becomes less gay with every passing day. Gay bars that were safe havens are now owned by corporations or non-gay folks…all to make a buck. I think its natural the gay community is turning away from the corporate sponsorship of Weho.

  15. Ben McCormickWed, Aug 10, 2016 at 12:38 pm

    The City of West Hollywood does itself a dis-service in its blind acceptance of these flimsy excuses and lies that are clearly not even backed up by the timeline and facts! It is time for our City to be bold, be strong, step up and demand, DEMAND, clearly detailed, truthful answers to our questions. If CSW is unable to provide them fully on a timely basis, then the City needs to find some other group to produce our Pride event, or take that role on themselves. I used to work at CSW, I know the information we want is all accessible. Surely one of the many people CSW paid large amounts of monies to for various tasks could be tasked with assembling the facts into a clearly understandable document that could be issued to answer our questions. We invested roughly $500K in Pride this year; we deserve answers. If the Council and City are unable to get a return on our investment, perhaps it’s time we look at new blood there, too.

  16. Anthony DamiaoWed, Aug 10, 2016 at 11:18 am

    there is now a Petition to remove cover Charge, This year pride Attendant no one went… 2017 will be better… The North east Region is coming together to have the Fees Removed

  17. 90069Wed, Aug 10, 2016 at 10:57 am

    Much like the disastrous Sunset Strip Music Festival – it is time for the City to cut the cord and more on for a community based celebration and not this monster that LA Pride has become.

  18. RandyWed, Aug 10, 2016 at 10:02 am

    Regarding attendance, I would think the Orlando shooting the night before the parade must have factored into Sunday’s festival attendance. I’m sure a lot more people stayed home than usual.

    I’m not sure how ticket prices affected attendance. It was the reason I didn’t go on Sunday.

    Do they not track festival attendance numbers? How did they compare to last year? My friend bought me a ticket on Saturday evening, and it felt fairly crowded to me.

  19. KrisWed, Aug 10, 2016 at 9:52 am

    What bothers me the most is CSW is tossing out numbers , but suggests that they don’t know how they got to those numbers and/or does not know how to run AP and AR reports with vendor filters to substantiate the numbers. Even if CSW isn’t using accounting software and running an excel spreadsheet , they still get the information . If CSW can not provide necessary AP/AR reports , they should be terminated !! It appears that WeHo has outgrown CSW.

  20. Zam LoomsteinWed, Aug 10, 2016 at 8:19 am

    I’m curious to see whether the reduction in attendance is a trend in large city pride events or pride events in general. I can imagine this possibility given the continued success of the LGBT community politically and socially. This publication has also shown that CSW spends more than other pride events, but I’d like to see how spending breaks down relative to the regional population and attendance. I also think the negative press played a major role in the poor attendance. Focusing less on the LBT and more on the G was clearly a mistake. Clearly their focus on gay millennials backfired. Fortunately, it seems as though they have learned their lesson, but it may be too late. No matter what, CSW clearly needs to reevaluate it’s budget and target audience if it wants to survive.

  21. ReasonWed, Aug 10, 2016 at 7:46 am

    Why do I have such a hard time believing these figures. That 344,950.00 figure for what amounts to ‘miscellaneous entertainers’ – that is an awfully big miscellaneous figure to me. If these are ‘real’ figures, I have to say as a former consultant and consulting manager, I am bidding on next years consulting contracts – I’ll do it for half as much. LOL I would love to see the balance sheet on the Pershing Square Event.

  22. Todd BiancoWed, Aug 10, 2016 at 7:43 am

    Gee… I can’t imagine why there was a shortfall of festival ticket sales. Couldn’t have been that large increase in prices, could it? The weekend festivities have lost money for years now – both under the old and new guard. The City of West Hollywood continues to provide significant levels of free or subsidized services in support of the event. What would happen if they had to pay fair market rates for these things? All over the country, in larger and smaller markets, organizers manage to either break even or have small profits or losses. And all this is done with a free or lower cost festivals and a free parades.

    I think it’s time for CSW to settle its debts, close its doors and call it a day. There must be other organizations or promoters who can do it and still not lose money. The City needs to be a leader here and open the doors to other possibilities and other operators/organizers. Maybe it’s time to break up into regional celebrations. Let the Valley, Downtown, Silver Lake and West Hollywood hold their own, much smaller events over the month of June. Anything but another painful year with CSW at the helm.

  23. MannyWed, Aug 10, 2016 at 7:30 am

    Staring at computer……

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