The 59-mile drive from Rocky Mount west to Raleigh takes about an hour along the mostly flat and nondescript highway U.S. 64.

It’s a trek that, for years, residents of the eastern North Carolina city of about 60,000 would regularly make for their entertainment, says Vanessa McCleary, Rocky Mount’s Downtown Development Manager. Eventually, Rocky Mountin 2009, named one of America’s 10 most impoverished cities by Forbesreconsidered that weekend migration. Four years ago, it launched Downtown Live, a free after-work series in a public space meant not only to show Rocky Mount residents a good time but, more important, get them and their dollars into downtown.

“To get them involved in the community, to get them downtown,” says McCleary, listing the reasons it makes sense for Rocky Mount and sponsors to invest nearly $50,000 each year in the series. “Downtown is the heart of any community, and we want to get them back to the heart.”

The series has worked: McCleary estimates that around 1,500 attend each concert, typically featuring a beach music band or an act that covers classic pop hits. This year’s schedule includes 10 dates every other Thursday, with a free movie night in the same space during alternating weeks.

“You get,” boasts McCleary, “a flavor for the community.”

The irony of Rocky Mount’s success, though, is that it was meant to prevent a migration to Raleigh for entertainment, the state capital with a population nearly seven times that of the financially benighted Rocky Mount. Raleigh’s downtown continues to grow; in fact, between 2008 and May of 2011, some 153 businesses57 restaurants and 31 clubs or bars among them, according to city recordsopened in the city’s resurgent downtown. But as of this year, unlike Rocky Mount, Raleigh has no sponsor-assisted, publicly funded live music series. After some of its organizers decided to shift their resources and focus, Raleigh’s own very successful Downtown Live ended in 2009. This year, both Raleigh Wide Open and Cherry Bouncetwo long-standing multi-day festivals that, among other events, included several stages of local and national talenthave fallen due to budget cuts and adjusted priorities. For some local entrepreneurs, these moves represent a troubling lack of municipal investment in the region’s continued growth and creative energy.

“There’s now enough momentum downtown that the city doesn’t need to be funding those loss-leader events,” says Bonner Gaylord, a member of Raleigh’s City Council since 2009. “There has been a need to establish these loss-leader events that get people to understand what downtown is about and to generate some momentum behind downtown. As with any investment, you go through your loss-leader period of losing money, and then that tide begins to turn. At a certain level, the government should get out of the way and support independent efforts rather than fund its own efforts.”

Doug Grissom, an assistant director of the Raleigh Convention Center, echoes Gaylord’s idea that city-sponsored events have already spurred sufficient interest in the city: “Downtown’s really progressed to where, even though there are weekends where there’s nothing downtown, it’s still full. The people are just going from restaurants to bars to shows. When we first started Downtown Live, we didn’t have that.”

But try telling that to a downtown business owner. Greg Hatemthe owner of Empire Properties and Empire Eats, and one of Raleigh’s most successful entrepreneurs and most consistent arts supporterssays his businesses depend on recruiting chefs and the like from larger cities, places like New York with its load of free entertainment. He’s baffled by the idea that the city has done enough to goad people downtown.

“I believe that that’s what they believe, and that’s disturbing. There’s the sense that we’ve made it, and as soon as you think you’ve made it, you’ve lost,” Hatem says. “There’s this air in Raleigh now that we’ve done all that we need to do, that this is where we need to be. As soon as you feel like you’re where you need to be, you’re moving backwards.”

Ashley Christensen owns Poole’s Diner, less than a block away from the city’s new amphitheater. Later this year, she’ll open three new restaurants near the former home of Downtown Live. She, too, balks at the idea that downtown is full, or that enough people are there: “The fire is just being lit. I think we’re starting to hit our stride, and the energy is becoming really satisfying.”

Acquiring that energy has been a slow process, which traces back in part to the summer of 2005 and the start of Bud Light Presents Downtown Live. A partnership between the management and events coordination company Deep South Entertainment and the Raleigh Convention Center, Downtown Live put a medium-size stage in the middle of Moore Square Park, an awkward venue where trees blocked sight lines, and beds and rows of plants and flowers separated portions of the audience.

In retrospect, though, the series was more successful than anyone might have predicted. For five summers, on every other Saturday, sometimes more than 10,000 people would file into the park to catch free shows by a motley mix of bandsyoung locals, area veterans, old touring acts like Candlebox and Everclear that were, to be generous, barely too edgy for the N.C. State Fair several months later. Still, it attracted a different crowd into a downtown that was rebuilding, bolstering those efforts by filling bars and restaurants and showing that Raleigh could actually be fun and vibrant at the city’s center. It was a clear sign that this could work.

“When Downtown Live was starting, the new Convention Center was just being built. A lot of people referred to downtown as a construction war zone at the time. There were a lot of reasons not to come downtown,” says Deep South and Downtown Live co-founder Dave Rose. “Downtown Live was one of many elements to drive people downtown who might not have been down here. And it had to be free. Or cheap.”

As Gaylord suggests with his “loss-leader” terminology, though, such events cost the city money. Based on costs of previous events, officials projected that Raleigh Wide Open 2011, for instance, would cost more than $260,000 and generate less than $70,000. In a tough fiscal year, where the budget has yet to be passed and cuts in arts funding are already on the line, the city considered it best to save that money this time around. Although sponsorship dollars generally covered the talent for each installment of Downtown Live, the Raleigh Convention Center estimated last year that each event cost the city about $20,000.

The Raleigh Amphitheater had been in talks for years before it was finally opened last summer; after witnessing the success of Downtown Live, it was the city’s next step. Why give the music away for free if people will pay for it? An investment, the amphitheater would eliminate the costly process of consistently building up and tearing down stages for events throughout downtown while selling tickets, too. An early budget model showed that it would pay for its nearly $3 million price tag in less than five years. Instead of seeing Candlebox or Everclear for free in Moore Square, officials hoped downtown Raleigh’s new residents and visitors might pay $30 to see a young indie band like Fleet Foxes or veteran stars like Donald Fagen and Boz Scaggs.

At this point, however, the amphitheater has failed to generate the revenues expected when its budget was presented to the Raleigh City Council in November 2009. In that proposal, the City of Raleigh’s take from 17 shows presented in the space each year by entertainment giant Live Nation were set at more than $632,000 for each of the venue’s first five years. But in its first year, the venue fell short of that goal by more than $40,000, based on figures not just for the projected 17 Live Nation events but for those hosted by other promoters, too. The actual gap might be bigger.

What’s more, that same budget noted that a title sponsor would pay $300,000 each year for five years for naming rights to the venue. That sponsor, Bud Light, was waiting in the wings. The corporate money that had been used for Downtown Live would be used to name this new public space. But last year, the North Carolina Alcoholic Beverage Control Commission rejected the sponsorship. The lack of those funds each year means not only that the city and Deep South aren’t using that Bud Light money to produce Downtown Live, but also that, without that cash boosting the amphitheater’s revenues, the city’s bad budget just gets worse.

Gaylord says he was assured the sponsorship was secure and that, if it fell through, alternatives awaited in the wings. More than a year after opening, Raleigh Amphitheater still doesn’t have a paying namesake.

“I don’t know that there’s a direct relationship between the lack of events and the lack of funding for the sponsorship sale,” says Gaylord, who actually favors more corporate sponsorships for more buildings and projects throughout the city to increase revenue. “But ultimately, it’s an income, and it’s a cut expense. Would we be looking at that differently if we had the income to support it? Maybe so.”

But there is hope: Greg Behr and Billy Warden, who launched Cherry Bounce as part of Raleigh Wide Open in 2008, say they expect both it and Raleigh Wide Open to return next year bigger than ever, with City of Raleigh support. After this year’s cancelation was announced, officials indicated that the NHL All-Star celebration in downtown had been a stand-in for the return of Raleigh Wide Open in 2012. And Grissom says that the Convention Center is now considering a plan to begin hosting free or cheap concerts at Raleigh Amphitheater late this summer, too. Like Downtown Live, they would use a corporate sponsorship to pay big-name talent. If it works, he says, it could lead to similar boosts in such programming throughout Raleigh. These are not commitments, though; they’re possibilities based on hopeful scenarios.

“Times are tough. I don’t want to be in the city’s position. I don’t even want to be in my position some days,” says Hatem. “But we all have things we have to juggle sometimes.”