Red Clay Agreement Decision Delayed

The Duluth City Council will consider adopting a two-year management agreement with legendary music promoter Eddie Owen, founder and former manager of Eddie’s Attic in Decatur, that would allow him to use the Red Clay Theatre in Duluth as a live music venue on Thursday.

The council voted during a called meeting Monday (Oct. 24) to place the item on the agenda for an already scheduled special meeting at 4:45 p.m. Thursday, Oct. 27. This will give the council and the city attorney as well as Owen’s attorney time to review the freshly drafted document.

The agreement between Owen and the city would allow him to manage the Red Clay Theatre in downtown Duluth and book musical acts on its stage. Owen has proposed to present live musicians in nighttime concerts at the Red Clay Theatre and offer workshops and classes for singers, songwriters and musicians during the daytime. Owen indicated he might later want to purchase property to build a facility for the school that would operate separately from the theatre.

Under the proposed agreement presented to the council Monday by Duluth Economic Development Manager Chris McGahee, the city and Owen would split the net profits of “Eddie Owen Presents” at the Red Clay Theatre 60/40 with EOP receiving the larger percentage. The city would also receive 40 percent of profits from subleases for music and vocal lessons offered by the school. EOP would keep 100 percent of the net profit from concession sales. Owen said he planned to apply for a beer and wine license as soon as possible.

If the council approves the agreement this week, Owen said he has a show lined up. “I would love to launch 'Eddie Owen Presents' Thanksgiving weekend.” It takes three to four weeks to sell tickets and promote a concert, he said. Owen told the council his goal is to book shows seven nights a week at Red Clay with three concerts scheduled some nights at 5 p.m., 7:30 p.m. and 10 p.m.

Owen recently severed ties with Eddie’s Attic. Owen and Eddie’s Attic are credited with launching the careers of Sugarland, John Mayer, the Zac Brown Band and others.

Other components of the agreement include EOP taking over paying for electrical, gas and water utilities starting April 1, 2012, and immediately begin paying for telecommunications (except fire), cleaning labor and supplies, and paper products, McGahee explained. The city would continue to be responsible for major maintenance and repairs, he said.

Also, the city, which owns the theatre, agreed to pay county, city and school property taxes that would be assessed since the theatre would no longer be considered non-profit and would become a for-profit operation. The utilities are costing the city $45,000 a year, McGahee said. Property taxes amounted to about $16,000 to $20,000 in the past, he said. The city would keep a enough revenue from its share of profits from the theatre operation in escrow to cover the taxes.

Councilman Billy Jones made the motion to put the agreement on the Oct. 27 called meeting agenda. The motion was seconded by Councilman Jim Dugan, and the vote was unanimous. “I think we know it will be a for-profit operation or Mr. Owen won’t stay in business,” Jones said. Owen said his books would be open to the city for review.

The proposed agreement also includes an “out clause” that would allow Owen to give the city 30 days notice if he wanted to leave the theatre and the city to give Owen six months notice to vacate.

The meeting on Oct. 27 has been called for the purpose of considering a hiring committee’s recommendation that the city hire Tim Shearer as city manager and authorize the mayor to execute an employment contract with Shearer, the former city administrator for Angels Camp, CA. The Red Clay agreement would be an addition to the agenda.