Revellers at the St Kilda Festival. The celebration could become a thing of the past.

Revellers at the St Kilda Festival. The celebration could become a thing of the past. Photo: Melanie Faith Dove

THE future of the St Kilda Festival is in doubt, with the City of Port Phillip divided over the wisdom of spending more than $1 million a year of ratepayers' money on an event that is largely attended by people from outside the municipality.

The council has allocated $730,688 towards the costs of staging the 2013 festival. Sponsorship is expected to contribute about $145,000, and the state government an additional $109,000. The council has estimated the cost of next year’s festival at between $1.03 and $1.2 million. That would mean a shortfall of $200,000 or more.

However, Port Phillip deputy mayor Frank O'Connor believes the true cost of mounting the festival is closer to $1.7 million, leaving council facing a much larger shortfall.

At a meeting on September 11, Cr O'Connor called for an urgent review of the council's funding of next year's event, due to be staged over eight days from February 3, 2013.

His motion, which was passed unanimously, reaffirmed the council's support of live music while calling on it to consider "the option not to proceed with the 2013 Festival Sunday".

Festival Sunday is the main drawcard of the event, attracting between 300,000 and 400,000 people a year to St Kilda. In 2011 a record crowd of 420,000 attended on the Sunday.

A 2010 review of the festival conducted by consultants Cultural Value found that 85 per cent of those who attended the Sunday event lived outside the municipality.

"Eighty per cent of the cost of the festival is tied up in the Sunday," Cr O'Connor told The Age. "It's an untenable burden for ratepayers."

Cr Serge Thomann, who describes himself as being in favour of fiscal responsibility but against any rash decision to cut the festival, said the vast majority of the council's contribution is spent on infrastructure.

"When you have 300,000 or more people coming to your streets you have to provide toilets, security, police," he said. "Since 2001 people have become much more conscious of security and things have become much more expensive as a result."

The main problem with the festival's funding arrangements is, all parties appear to agree, the lack of a major sponsor.

From 2007 to 2010, Foxtel spent $1 million sponsoring the festival. But since that contract came to an end, no other party has stepped in to the breach. According to a recent blog post by Cr Janet Bolitho, "this year, considerable effort went into trying to secure a major sponsor. The arrangement yielded a mere $4000".

Council rules prevent it from taking sponsorship money from alcohol, gambling or tobacco-related enterprises. Cr O'Connor said other potential sponsors were put off by the perception that the festival is "just a big party, and they're not happy being associated with that".

The council is believed to be split on the issue of cancelling Festival Sunday in 2013, with three in favour of the move and three against. Outgoing councillors O'Connor and Bolitho favour cancelling next year's Sunday event. The view of Mayor Rachel Powning, who is also not standing for re-election, is not known, though she has previously put on the record her support for live music in St Kilda, and the value of the festival in particular.

Serge Thomann believes that value can't be determined purely in financial terms. "For me, the festival is three things," he said. "It's a free community event, a celebration of live music, and a celebration of St Kilda and Port Phillip as a place to live."

The 2010 report did attempt to value Festival Sunday in economic terms, determining its economic contribution to the suburb at $14.6 million in 2009, based on a crowd estimate of 250,000 people.

Council will decide next Monday — its final meeting before going into caretaker mode ahead of elections on October 27 — if that is enough to justify carrying a very expensive can.