The on-again, off-again saga of Chestertown’s movie theater took a new twist at Monday’s town council meeting. The principals of Horizon Cinema, which originally planned to reopen the theater last November under the name Chesapeake Theaters, came before the council to propose a deal that could get the theater open by Memorial Day weekend.
Kay MacIntosh, the Chestertown economic development coordinator, introduced Mike Klein, Ira Miller, and Bob Weinholdt of Horizon Cinema, which operates four multi-screen theaters in and around Baltimore. She said Silicato Development, which owns the Washington Square mall where the Chester 5 Theater is located, had been willing to work with a theater operator to reopen the business since it closed nearly two years ago. However, initial talks between Horizon and Silicato broke down sometime before a projected November/December 2017 opening. The deal is now back on track, she said, but the parties are about $75,000 apart in their negotiations. Horizon is asking the town to advance that amount to Horizon to help close the deal and allow the theater to reopen. The town would be repaid by the revenue from the 4 percent amusement tax on theater receipts, a source of income it has not received since the closing of Chester 5. She said the reopening of the theater would benefit the local economy, with movie patrons coming from out of town and spending money in local stores and restaurants as well as going to the shows.
Klein took the floor and said he was happy to answer any questions from the council. “I wish we’d opened in November,” he said. “This project can be really successful, and we want to make it a real community theater. There’s been a lot of community interest.” Klein said he’s been speaking to various local groups, including MacIntosh and Jamie Williams, the Kent County economic development coordinator, and to Washington College about Horizon’s plans.
Councilman Marty Stetson asked whether the theater would show first-run movies, and how many screens it would offer. Klein said the group was aiming for first-run films and plans to operate all five of the screens currently in the building. The building will be completely renovated, including the restrooms and the concession stands. Plans are to build platform seating to give viewers in the back part of the auditorium a better view. New drapes and sound systems, as well as larger screens, are to be installed, and the food offerings will be expanded to include pizza and other finger foods such as fries.
Councilman Ellsworth Tolliver asked who would decide what films to program. Ira Miller said he would be in charge of the booking. “We’ll have all kinds — family films, sci-fi, art films. We want to bring everybody to the theater,” Miller said. He said the theater would do fundraising projects for local nonprofits, “to give back to the community.” He said they were also considering offering special prices for Washington College students. “You’ll have people coming from Millington to Chestertown for the movies,” he added. Responding to a question by Town Manager Bill Ingersoll, he said the theater would have between 12 and 15 employees.
Mayor Chris Cerino asked Ingersoll to give the background on the amusement tax, from which the Horizon group said the proposed $75,000 advance would be repaid.
Ingersoll said the tax dated to about 1991, and was designed for special events. It originally included arcade video games, but with the decline of that fad, it was recently almost entirely dependent on movie revenues. Since the closing of the movie theater, “It’s currently close to zero,” he said. He said the tax would possibly return up to $20,000 annually if the theater did well. Horizon’s request for the $75,000 advance was unusual, he said, but he didn’t see why the theater wouldn’t generate that amount over a reasonable time period. He said Horizon is ready to invest some $500,000 in renovating the theater. He said the deal should be structured so the advance would be paid back if the theater closes before the entire sum is raised. “We need to support the theater to make sure it’s a success,” he said.
Weinholdt, who supervises construction and renovation for Horizon, said the town was not to blame for the closing of the theater. He said the previous operators had not renovated or upgraded the facilities since the theater opened. “You can’t expect people to sit in a theater like that,” he said. He said the new projection and sound systems would cost some $270,000, which Silicato has agreed to finance. He said the theater would initially have “rocker back” seats, but plans were to replace them with recliner seats, which would take about 16 weeks to arrive once they were put on order. The theater as a whole will be unlike anything Chestertown has ever seen, he said. “We want to open for the summer — that’s our biggest season,” he added.
Cerino said it would be better for the town if Horizon made up the $75,000 difference with Silicato and the town refunded the amusement tax to them. “You’re asking for about 10 percent of our cash on hand,” he said.
Weinholdt said the principals had just spent $750,000 to open a new theater in Fallston. “We don’t have a lot of cash flow,” he said. Theaters have a small profit margin, especially in small markets like Chestertown, he added. Asked if Silicato could advance the amount, he said the developer has already promised $270,000 for the projection and sound systems. “We need the money up front to do the job,” he said, adding, “We’re willing to work with you.”
Cerino said the town has given tax incentives to other businesses, particularly in the new Enterprise Zone. “I can see us doing that” for the theater, he said. While he was “interested in helping,” he said he wanted to “eliminate the risk for the town.” He said he was also worried about setting a precedent other prospective businesses might use to ask the town for a payment to help them locate here.
Rebecca Murphy, a real estate development specialist who has worked with Miller’s theaters in Baltimore, and who is a part-time Chestertown resident, said the amusement tax would provide a “finite and guaranteed” source of income to repay the advance. “If you all agree this is something the town wants, the question is, do you want to put a deal together to allow [Horizon) to get from today to an opening?” She said the old theater was paying $12,000 annually in a bad year. “If that’s the floor, you’re out in seven years. It’s money you won’t get any other way.”
Councilman David Foster questioned whether the tax revenue is “guaranteed.” “I can assure you we’re interested,” he said, but “we need to know what happens if you don’t succeed.”
MacIntosh said the town needs the theater to remain attractive to residents and potential residents. She said the town would miss an opportunity if it doesn’t make the deal work. The property could end up as another big box store if it can’t reopen as a theater.
Tolliver moved to authorize Ingersoll to negotiate with Horizon on behalf of the council; the motion passed without opposition. “I think we can get a win-win,” said Ingersoll.
Cerino told the Horizon group, “We appreciate your coming in. I’ve got your back, but I’ve got to do due diligence for the town.”
Miller said, “When we open, it’ll be a great day for Chestertown.”
garret falcone says
Congrats to Kay.. Jamie…the Mayor and Council and others involved!!!
Thank you for your efforts to work with ( I’m sure) a wonderful company to bring this much needed town amenity back to life!!!
Thank you!!
Gretchen Stroh says
Please please please, let’s get this done! I’ve only been to one movie in Middletown since the theater closed. I miss going to matinees…and our kids need a local theater in their lives.
Richard Bolton says
This is great news. So many businesses have left us never to return. We only have a few resturants left.
It seems to me that no one is really concerned that we are beginning to look like a ghost town. Not everyone can or wants to be a member of the flourishing Chester River Country Club.
I almost feel guilty going to Middletown. We have such a beautiful town why do I feel like there is an effort to stifle progress?
Walter Geddes says
This is great news. When I moved here, I always said that would never live in a town without a movie theater. Then it happened. Thanks to Jamie and Kay for doing such great work to help further new businesses in Chestertown.
Charlotte Patchett says
It will help the town and everyone involved in the community it will give the kids also a place to go and watch movies and not have to drive so far Sun can even just walk to the movies and if it’s nice as the Middletown one oh yes cuz I’ve been in Middletown three or four times I just love it let’s keep it on the roll on the ball and let’s get this movie theater opened up
Sheila Barry says
Let’s make it happen! Chestertown needs this for all its residents! This would be a real plus to the economy.
Eliott Fuhrman says
Well Kay and Tracy stand with it and theater will pay minimum of taxes . The problem is shopping center owner should put in fit up of $50 sq ft 25 as part lease 25 to be paid backat7% interest over 5 years and should give 3months free rent .Remember theater will increase total value center 3 times what developers of their skin . where can get the. Funds 1) Delmarva major winner have them give energy discounrpt of 19% for 5 years. 2) what percentage of parking lot, and can county give a tax credit to center under enterprise zon 3)are they hooking up to new fiber since county owns fiber ,give fee 5 years 4)where get seats, how about lease from China because China gets lease payments in dollars,they love dollars.Think Big
Steve Payne says
Shopping center owners often do contribute towards tenant work but they usually do want the tenant to have skin in the game too. It sounds like they’re just a little short right now. The build out of the theatre is going to be substantially more than they are asking from the town.
Alexander says
From your lips to God’s ears.
Rich Bolton says
This could be great for Ctown if Tinsel Town makes a movie worth seeing.
Would it work if 1 or 2 of the theaters were convertible to a live stage for little theater or musical performaces? I just can’t imagine 5 movies at one time being of interest to our small community.
Very encouraging news…. hope there is more to come in the culinary area…..
Frances says
Count me in as a big supporter of this plan. It would be a real boost for Chestertown’s slightly shaky image as a thriving community, and a boon for all of us retirees who grew up with movies rather than television. We still love going to the movies, as do young families, and Kent has plenty of both. Hope the Council can make it happen.
J.M. Kramer says
I would like to know what Silicato’s rent for the property will be. And how many months would the theater have to stand vacant to cover the $75K difference. The theater benefits far more than the taxpayers of C’town, why can’t the Silicato and/or the county participate in closing the deal? A decent theater in the county is a boon at so many levels, can our leaders and business make it happen?
Katherine Dalton says
Thank You Thank You Thank You!
Thank you all for your efforts and hard work.
And thank you all for your imaginations foreseeing a brighter Chestertown cinematic future!
Keith Thompson says
I can understand why the mayor and council would be reluctant to set a precedent for loaning money to a private business, but a movie theater would be one of the more preferred types of businesses based on the impact of not having one has on the community.
What baffles me is tying a proposed loan into the town’s amusement tax. I find it odd that the town is levying a tax that it currently isn’t collecting and for a long time was relying on just one business to fund. Has there been any thought to simply eliminating the tax, especially if the tax may be a deterrent to any other amusement based small business that would like to operate in town?