What if Level III hosted Widespread Panic shows once every couple months, and crowds spilled into the street? You can guarantee that Starkville Police would have already busted everyone downtown that smelled like patchouli. For some reason (fear of being labeled racist?), they refuse to enforce laws whenever Level III is open.
There are two real options: either shut down Level III, which is closed 95% of the time and contributes nothing to downtown or find a new police chief.