Following yesterday’s news that the future of St Kilda Festival is uncertain following budget blow outs from local council, the City Of Port Phillip, as they enter pre-election mode; news has come to light that the council actually knocked back half-a-million dollars in sponsorship that would have ensured the music event’s 2013 iteration.

The Age reports that the City of Port Phillip rejected a $500,000 sponsorship deal for the St Kilda Festival because it was perceived that the proposed sponsor Jeep – a division of the Chrysler motor company, was seen at odds with organisers’ stern sustainable transport policy.

The council allegedly employed New South Wales-based Sound Campaign, an external contractor, to seek out a major sponsor to help with the production costs and budgeting of next year’s festival. In July, they found a sponsor in Jeep, who would have naming rights to the St Kilda Festival – the deal was turned down outright.

Councillor Janet Bolitho told The Age that: “It would be fair to say that the sponsorship arrangement that was put to us was not consistent with our values. We are entirely, utterly and wholly committed to a sustainable transport agenda and Jeep does not fit in there.”

However admirable, turning down the sponsor has led to a black hole in the budget that has led to Deputy Mayor Frank O’Connor calling for an urgent review of the music festival after hearing that the bill for the 2013 iteration of the festival would be budgeted at $1.2 million.

While the City of Port Phillip is allocating $730,688 towards the February festival’s budget, with current sponsors contributing a mere $144,000 to the cost of staging the event; it leaves a gulf of around $350,000.

Cr O’Connor believes that the projections for running St Kilda Festival for 2013 would be closer to $1.7 million, leaving an even bigger financial gap than first anticipated.

The Deputy Mayor first raised the issue at a meeting last week calling for an urgent review, and while all seven councillors agreed that they would continue to support live music in their district, O’Connor also emphasised that there needed to be a discussion about other means to “achieve the council’s objectives regarding live music and cultural development”. One consideration would be the cancellation of the music event on Sunday and instead keep budget costs lower on Saturday’s activities.

The Sunday festival is the main drawcard of the event, with a 2010 review of the festival conducted by consultants Cultural Value found that 85% of attendees lived outside of the municipality. Meanwhile O’Connor told the paper that “80% of the cost of the festival is tied up in the Sunday… It’s an untenable burden for ratepayers.”

Fitzroy St Business Association President Roger Wyndham has already criticised the council for rejecting major sponsors, and their crucial financial contributions, saying that if Port Phillip council had been more open-minded about potential sponsors for the event, it wouldn’t have led to the blow-out in the budget; saying: ”Don’t get me started on wasted time and money.”

The unfortunate financial situation has stemmed from the fact that while the event has become increasingly popular, drawing a record attendance of 420,000 in 2011 as punters flocked to the St Kilda Foreshore to see Tim Finn, Kimbra, Gareth Liddiard and Jebediah, the event has not found suitable sponsors for the event since Foxtel parted ways in 2010; after contributing nearly a $1 million since 2007.

Worst of all, councillors will vote on St Kilda Festival’s fate just one day before the council enters election caretaker mode, next week on September 25.

Any concerns about the budget going into the red for an incoming council has potentially made St Kilda Festival’s financial concerns an electoral hot potato – attempting to deal with its costs before a new council is elected.

If St Kilda Festival were to be cancelled due to budgetary constraints, it would be an enormous step back for Port Phillip City Council after a few, small encouraging steps forward in regards to their dealings with live music.

Pulling the plug on their biggest and most successful live music event may leave some money in the budget, but it would leave an even bigger black hole in the city’s music calendar and cultural currency.

It’s not the first time that Port Philip council has butted heads with live music however. It certainly seemed that local council had experienced a change of heart following the encouraging news that the City of Port Philip’s Mayor ordered for greater communication between live music venues and the community to help develop local music culture.

Additionally, it helped balance out the issues over St Kilda venue-come-record store Pure Pop Records, who previously seemed to the target of a witch hunt by residents and local council, with Fun Police tacts designed to close the venue over noise complaints. As well as the upward turn for the Prince’s new bandroom, the Public Bar re-opening.

In related news, the DIY bomber that tragically marred last year’s St Kilda Festival, was recently jailed for at least 15 months with no parole.

23-year-old apprentice baker, Sam Aniello Castellano pleaded guilty to eight charges of eighteen last April – and was recently sentenced after he set off two DIY devices, injuring five people – two seriously – at St. Kilda Festival in February, 2011.