Rialto Theatre Owes Over $100K in Unpaid Payroll Taxes

Originally published March 15, 2016

The Rialto Square Theatre board voted against an early renewal of Rialto General Manager Randy Green’s contract as the city investigates nearly four months of unpaid payroll taxes in the amount of $120,000.

Green could soon be out as the theater’s general manager, but the board was unable to reach a separation agreement because of an “impasse," Joliet Mayor Robert O’Dekirk said at Monday night’s Pre-Council Meeting.

O’Dekirk said he and City Manager James Hock were notified about a week and a half ago about a financial issue at the Rialto.

After meeting with Rialto Board Chairman Dan Vera and Rialto attorney David Silverman, the board was told the Rialto had not paid its state or federal payroll taxes for the months of November and December. One payment was made in January, but no payments have been made since then, according to O’Dekirk.

“The Rialto owed the government, the state and the federal government, collectively about $120,000,” O'Dekirk said.

The council received a request to forward $120,000 for the taxes by Wednesday of this week.

“Since that time, it was agreed that they owed the State of Illinois $10,000 and the federal government $110,000. They are accruing significant penalties by the day because of past due amounts," O'Dekirk said.

City Manager Jim Hock approved a $10,000 payment for the state payroll taxes.

In addition, there is $395,000 owed to vendors, Hock said, but those numbers could be incorrect as the Rialto will front money to performers with the expectation that money will be made back in ticket sales and other purchases.

Of the $395,000 that is owed, Hock said the theater has about $72,000 in its bank account.

Councilwoman Bettye Gavin called the situation “egregious” and wants to see something done about it.

Before the council pays any more money to the Rialto, O’Dekirk said he wants to know exactly what’s going on there, including the “real status of the Rialto's finances” and who knew it was happening.

Councilman Larry Hug, who got into a contentious debate with Green over the Rialto in December, said he agrees with O’Dekirk.

“We do need these questions answered,” Hug said. “This $120,000 will not shut down the Rialto, it will protect the general manager from repercussions from the federal and state government and I have no intention of getting in the way of the federal and state government.”

Councilwoman at Large Jan Hallums Quillman said she would not be in favor of a bailout.

“As much as I am an advocate of the Rialto Square Theatre, I would have to say in this instance I cannot support a bailout at this time,” Quillman said.

Including the $600,000 given annually by the city, the Rialto’s budget is around $3.5 million. The Joliet City Council will discuss further action once the status of Green's employment is made final.

"Before we commit anymore money, we need to know what we're looking at," O'Dekirk said.