Where Does Your Ticket Money Go?

The Reno-Gazette Journal pretends to answer this question, by point to a “new announcement today” from BMOrg analyzing this very topic. How was this announced, and to whom? It seems it only made it to their Facebook page. I can’t see it in the last “Jackrabbit Speaks”, it is not mentioned on the official Burning Man blog, and there is no link to it from the “What is Burning Man” section it is filed in. There is nothing on the burningman.com web site, and it doesn’t come up in a search there for “where does ticket money go”. The page seems to be an orphan on their site, and for some reason is immune to any form of public comment on it.

From the Reno Gazette Journal:

Burning Man announced today where ticket sales money goes to shed light on why tickets cost what they do.

…According to the announcement, the majority the cost of ticket sales goes to fees, equipment rental (including portable toilets), medical services and building the large wooden man structure.

The full report can be found here.

The following are some of the costs Burning Man said it incurred in 2013:

• Bureau of Land Management (BLM) manages the land the event is held on: 2013 fees totaled $4,522,952;

If you want the full report, you should actually read our coverage: Profit Grows, Donations Shrink: 2013 Afterburn Analysis; and Art World Rocked which shows the distributions of grants based on IRS filings. You can also check out this Google Docs spreadsheet that Burner Kevin put together from the Afterburn numbers (which don’t even add correctly in their 2011 and 2012 reports).

What is interesting here is the subtle use of language to mask truth. The carefully chosen words “BLM and Other Usage Fees” are repeated and slightly distorted, through a technique sometimes called “Chinese whispers”, to become “BLM manages the event…2013 fees”.

The misinformation has already been picked up by Ron’s Log and echoed as if it were fact “$4.5 million…that’s what Burning Man paid the Bureau of Land Management in fees”.

Following the links to the “full report” actually takes you to the new discussion using numbers taken from the Afterburn report. This says:

The Black Rock Desert is public land, but we don’t get to use it for free. It also takes a lot of equipment and hours of labor to put things together out there. The following are just a few highlights of costs we incurred in 2013:

• The space we use is managed by the Bureau of Land Management (BLM) and our 2013 fees to them totaled $4,522,952.
• Our 2013 cost for Rental Equipment (heavy machinery, portable buildings, staff radio gear, cars and trucks) came to $1,166,307.
• Port-o-potties are crucial for our fair city and those related costs alone racked up to $970,836.
• To offset the impact that our temporary population has on emergency services in the local area, we pay $301,660 to local agencies such as county law enforcement, Paiute Nation, and Nevada Highway Patrol.
• We still take care of our own though, and our on-playa medical services costs came to $455,024.
• Getting tickets printed and shipped is also a nice chunk of change, coming in at $479,741 last year.
• Building our iconic center piece, The Man, isn’t cheap either. Last year we spent $407,055 to bring it to life and share the ritual of burning it down.
• The other “Man” — the government — likes his cut as well and we paid $1,021,851 last year in taxes and other licensing fees.

Seems innocuous enough, right? Well the reason that the word “other” is significant in the original report is that in 2013, this category jumped from $1.8m to $4.5m – with no explanation given for the gigantic leap ($2,654,919 gain). “Taxes and Licenses” jumped from $154,994 to $1,021,851, also without explanation ($866,857 gain). At the same time, “Decommodification LLC owns the rights to everything” (or words to that effect) is now on all the tickets. Coincidence? Well the fact that BMOrg is trying to gloss over it by using increasingly vague language makes that seem even less likely.

From Burners.Me:

The most significant thing in the 2013 financials is the spectacular leap in usage fees – up about 250%, from $1,868,033 to $4,522,952. We know that the BLM did not increase their permit fees – in fact, some of their costs are now shared with Pershing County. We also know that the BMOrg founders created a secretive, privately held company called Decommodification LLC, which receives royalties from the Burning Man event for trademarks and images (it owns the commercial rights to every photo and movie shot by anyone at Burning Man). It’s not clear which expense category these payments fall under in the unaudited Afterburn “accounts”, but it seems like “BLM and other usage fees” would cover it. The difference between this expense item for 2013 and 2012 is $2.6 million, so I think a fair estimate for the size of this royalty payment is $2.5 million

Now, perhaps the BLM did almost triple their rates, and Decommodification gets next to nothing. Strangely, it’s not mentioned in this year’s permit – which says BLM gets 3% of gross revenue, same as every other year. This would be $900,000 according to Marian’s $30 million figure from her recent speech in Tokyo. Page 8 of the Permit Stipulations says they have to pay a “cost recovery fee” to reimburse the BLM’s costs, which have been offset by integrating their activities with Pershing County cops. This probably doesn’t change much from 2012 (56,141 tickets) to 2014 (61,000 tickets), so if we assume it is the same we can ignore it. That leaves $3.5 million of “other” fee hikes to account for: let’s call those “mystery royalties”.

Does some of your ticket money go to Decommodification, LLC? Yes – look at your ticket terms. Is this payment covered by “Mystery Royalties”? Well, we can’t find it anywhere else in their books, so probably. Does most of the Mystery Royalties go to the BLM? I doubt that, but I’m open to the possibility. I invite BMOrg to open their books and share with the community the details of the “BLM and Other Usage Fees” payments, to clear the air and ensure that everyone is speaking from a position of truth and openness. If all of that money goes to the BLM, why would BMOrg even write the words “and Other Usage Fees” on their Afterburn Report? Why not just say “BLM”?

This is what you’ve agreed to in the Ticket Terms and Conditions:

I acknowledge that the name “Burning Man” is a trademark owned by Decommodification LLC and licensed to BRC, and that BRC LLC has been given the sole right to license and enforce that trademark, and that all of Burning Man’s logos, trademarks or other intellectual property are owned by Decommodification LLC and licensed to BRC, and I understand that these two organizations control all rights regarding the licensing and reproduction of any imagery recorded at the Event. I agree that I will not use the mark “Burning Man,” the logos of Decommodification LLC or BRC LLC, or the likeness, drawings or representations of the Man or of the Black Rock City map, or any other trademark of Decommodification LLR or BRC, on any website (except for Personal Use, as described in Paragraph 5) or in any other manner, commercial or otherwise, except for nominative or classic fair use

The Reno-Gazette Journal might be fooled by your magic words, BMOrg, but not Burners.Me! We ask: “where’s the proof?”

Burning Man’s announcement compares their price to commercial festivals:

 The group said Burning Man ticket prices are comparable to other events, including the four-day Bonnaroo ($260, plus fees) and Coachella ($349, plus $85 car camping) festivals and the five-day Glastonbury event ($333.19, plus $40 car parking).

Good – they might keep the ticket prices where they are for next year, then. Those festivals generally pay for the entertainment they provide to their customers, who can buy food and drinks; and they have to pay for security and site use, just like Burning Man does.

Where does your ticket money go? $13.60 of it went to art in 2013. Compared to $52 to profit and $103 to taxes, fees, medical, cops, and royalties (lumped together). The mystery royalties component works out to more than half the latter: $57 a ticket.

We help artists, too. In 2013, we distributed $800,000 in grants to artists. For 2014, we increased that figure to $1 million in art grants and support

Art Grants in 2013 were $12,500 per project, down from $14,894 per project in 2012. $825,000 was the officially announced amount of grants in 2013, which was upped to $830,000 in the Afterburn report. Their claim of $1 million on Art Grants this year now includes “support” as well as cash, which as we’ve already pointed out has a large component of BMOrg personnel costs.  This year there are 60 winners who will share $16,666.66 each (including support) from BMOrg. If this was measured in cash, it would be a meteoric surge towards the artists, an increase of 33.3% on average each. Still a very small share of the cost to get big art projects on the Playa, and off without a trace.

When someone tells you “BLM charges $4.5 million a year for the permit”, ask them to prove it. Don’t believe something just because it’s in the newspapers. And always ask what “other” means.