La Grange Theatre Debate: 'Socialism' Or Good Deal?

LA GRANGE, IL — La Grange Theatre this week received support in its plea for the village's help in its plan to turn over the theater's operations to a chain.

The theater owners are asking for La Grange to forgive $1 million in village loans in its plan to let Downers Grove-based Classic Cinemas run the theater.

At Monday's Village Board meeting, trustees said the owners sweetened the proposed deal by offering to share some of the theater's profits, which one official estimated could amount to a half million over a decade.

During public input, the wife of one of the trustees denounced a deal to forgive loans as "corporate socialism." But her husband and some of his colleagues indicated an openness to a new arrangement.

A dozen years ago, the village entered a deal with theater owners John Rot and Dan Chopp to use money from the tax increment financing district, or TIF, to help with the theater's renovation. Under the agreement, the business does not have to repay the money as long as it remains a theater.

The theater has been a second-run venue, meaning it is unable to show just-released films. This hurts the business, the owners said.

The owners said Classic Cinemas' relationship with movie studios would bring first-run movies, thus increasing income. The theater has been closed throughout the pandemic.

"The sub-run model is dead, and this theater and our business plan has always been a sub-run theater," Rot told the Village Board. "This is really about a community asset. We really want this to be a win-win-win."

Classic Cinemas, which operates 15 theaters in Illinois and Wisconsin, plans to invest at least $1 million into the theater. The chain wants to install heated, reclining seats and increase the number of auditoriums to five, from four currently.

The changes will reduce the number of seats by a lot. But Chris Johnson, CEO of Classic Cinemas, said he expected ticket sales to increase, despite fewer seats. At the chain's theater in North Riverside, it cut the number of seats by two-thirds, but saw its income triple, he said.

During public input, Kristen Gale, wife of Trustee Lou Gale, said she has enjoyed the movie theater. But she opposed forgiving any loans.

"I'm here to tell the board that I'm against any deal for the theater that does not recoup the taxes that were given to it in exchange for an agreement that it would continue as a movie theater," she said. "I'm here because I'm against corporate socialism. By that, I mean a reduction in taxes to keep a business in business, privatizing profits while forcing losses on the government — i.e., me the taxpayer."

She said the board should not support any deal that ends up being a donation to a business.

"If that means no theater, so be it," she said. "That's capitalism."

She was the only person during public comments who took that position.

Trustee Beth Augustine said the proposal was not "corporate welfare." Over the years, she said, the village effectively used its TIF to improve downtown, which she said looked "shabby" years ago.

"Realtors would drive around downtown for many years. They didn't want their prospective homebuyers to see what our downtown looked like," Augustine said. "Those of you who have moved here the last 15 years can't imagine that."

She called the theater a "one-of-a-kind business."

"The theater is special. It is a driver. It supports all businesses. People go to eat, drink and shop before or after a theater experience," Augustine said. "The goal was never to get the money if it was kept as a theater."

Trustee Shawana McGee agreed. A lifelong resident, she said she and her family have gone to the theater for years.

"Whatever happens, we're going to have someone disappointed," McGee said. "I would hate for us to take this kind of opportunity for granted. Our theater plays a very important part of our community."

Trustee Gale said he did not want to privatize profits while the public paid the costs. He said he agreed with the idea of removing the liens on the property and sharing the profits with the theater. But he said he feared that if the village removed the liens, the theater would close five years down the road.

"The theater is this quasi public good. It's a private entity run by a private business, but it is also an economic engine for the village, so it's in this strange middle place. How do we value that?" he said.

Village President Mark Kuchler said the village wants to keep the theater.

"There is no other use for that building other than a theater," he said. "The money that is generated if we can come to a compromise will go to economic development. It will support keeping downtown the great destination that it is. We want Classic Cinemas to be phenomenally successful."

The board took no action on the theater. Kuchler said the board would continue to review the issue. He set no timeline for a board vote.