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Baltimore city committee votes to lift cap on sports, concert ticket surcharge

Baltimore’s 50-cent cap on ticket surcharges for events like concerts and sports games could be gone — for a while, at least.

The Baltimore City Council’s Taxation, Finance and Economic Development committee on Thursday voted to repeal, until Nov. 1, a 1949 article that prohibits ticket service fees from exceeding 50 cents.

The bill also amended the Baltimore City Code to exempt licensed ticket sellers from its ban on scalping tickets, meaning they could set prices as they see fit.

Council members argued over the meaning and efficacy of the scalping exemption, but ultimately passed the bill.

“We suddenly find ourselves like Alice in Wonderland and we don’t know whether to drink “Grow Big” or “Grow Small,” said Council Member Mary Pat Clarke, who is not a voting member of the committee, but who attended the meeting.

The bill is scheduled to go before the full council for a hearing on Monday. The committee passed the bill 3-1 with one abstention after more than two hours of debate. Voting for the repeal were sponsor Carl Stokes, William H. Cole IV and Edward Reisinger. Bill Henry was opposed, while Warren Branch abstained without comment.

By the time of the sunset provision, the council and mayor plan to draft permanent legislation.

“I see this as a temporary solution,” Cole said. “As in, let’s pass this legislation and get it done today and get back to work.”

The bill was prompted by a January decision from the Court of Appeals, which found the 50-cent cap applied to Ticketmaster’s service charges.

The case, brought by a city resident who had purchased a concert ticket, was filed against Live Nation Entertainment Inc. (which merged with Ticketmaster Entertainment LLC in 2010); its local ticketing agency, Landover-based Monumental Ticketing L.P.; and Lyric Productions LLC, which owns the Lyric Opera House in Baltimore.

The 1949 article under debate was created in response to scalpers selling tickets to U.S. Naval Academy football games.

“The ordinance may be functionally obsolete in that regard,” retired Judge Alan M. Wilner wrote for the unanimous Court of Appeals, “but it is not legally so.”

Stokes proposed the legislation out of concern that Live Nation would stop selling in Baltimore, which could potentially decrease business for local venues and ticketing agencies.

“We need to have a comprehensive conversation,” Stokes said. “We need to allow for reasonable time to craft a strong bill.”

Henry favored an amendment temporarily increasing the cap to $5 per ticket or 10 percent of the ticket price, a value he said he considered to be a “reasonable level.”

“The fact of the matter is we have 65 years of precedent on limiting service charges,” Henry said. “If you try to have a threshold to what 50 cents was then, $5 would be that now.”

Stokes, however, said setting a new cap amount would be like “speaking into a vacuum.”

Henry also favored pushing up the timeline as well, insisting the council could draft legislation before budget season starts in a month and a half.

“There is a desire to see this law go away,” Henry said. “My fear is by suspending this for six months, we are not changing the dynamic of the conversation. It’s too easy to believe six months from now for ourselves to be here saying we need more time.”

Council Member James B. Kraft, who is not a voting member of the committee, also questioned the repeal of the cap.

“Every email I’ve received from constituents or citizens of the city are saying, ‘Are you crazy for helping Ticketmaster?’” Kraft said. “I have no sympathy for Ticketmaster or Live Nation, who I believe are just shy of a monopoly.”

Cole said the 50-cent surcharge cap would affect several local ticketing agencies and venues in his district and not just large, national companies like Live Nation.

“It’s about venues and other ticketing services as much as it is about the Big Bad Wolf,” Cole said.

When the bill is considered by the council, Clarke said, the scalping provision will have to be clarified.

“We need to state outright what this bill says, so we know what we are voting for or against,” Clarke said. “At this point, I don’t know after sitting through a two-and-a-half hour meeting.”

Baltimore resident Andre Bourgeois filed the lawsuit in July 2011 after buying a $52 ticket to a Jackson Browne concert at the Lyric through Ticketmaster and paying $12 in additional service fees.

In 2009, Live Nation earned an average of $7.82 per ticket, according to the complaint, which also said a facility agreement between Ticketmaster and the Lyric has granted Ticketmaster exclusive rights to sell Lyric tickets.

Bourgeois’ complaint also alleged that there is a kickback scheme going on between the Lyric and Live Nation, with the ticketing agency giving the venue a portion of the money it receives in service charges.

Judge Ellen L. Hollander was handling the case in U.S. District Court and sent certified questions to the Court of Appeals last June. The case is back in Hollander’s court following the Court of Appeals’ decision.