New London - The local economy's latest victim is local music.

The sixth edition of I AM Festival, the free all-ages rock concert scheduled to take place Sept. 10 on Custom House Pier, has been postponed due to a lack of funds.

In what was a wrenching decision, co-organizers Rich Martin and Sean Murray said Thursday they decided not to stage the annual underground music and arts festival because they did not receive enough funding from grants, sponsorships and donations to put on a show that would exceed the previous editions of I AM.

"We could not find a suitable headliner to keep it at the level it has been," Martin said.

Murray said that it is important for I AM to remain vital and not to stagnate.

"The whole point of this festival is for it to grow," Murray said. "There is no point in having it backpedal and it being half as good."

In 2010, the festival had a budget of about $17,000, while this year's budget would have been significantly less. Murray said in a 2010 interview that festivals of I AM's size and scope have budgets close to $50,000.

Martin and Murray, along with Sailfest promoter Barbara Neff, staged the first edition of I AM in 2006 to draw students from Connecticut College, Mitchell College and the Coast Guard Academy, as well as young people from around the region, to downtown New London.

Due to financial constraints, Martin and Murray's booking strategy has been to find headline acts that were already touring in the Northeast and sell them on the idea of an independently run show in a waterfront setting for a reasonable price.

In previous years, I AM drew crowds to Waterfront Park to watch bands such as Girl Talk, Matt & Kim, the Drums and Free Energy that have gone on to flirt with mainstream pop success.

Other I AM alumni include the late garage rocker Jay Reatard, folk chanteuse Martha Wainwright and several notable indie-rock bands such as Deerhoof, Rainer Maria, We Are Scientists and Darlings.

The festival has also been an important proving ground for New London bands such as the Weird Beards and Quiet Life, and always included an impressive roster of New Haven acts such as M.T. Bearington.

Martin said the festival could return in 2012.

"Our goal is to start now, build interest, keep it going and get people to see this is a good idea," Martin said. "It's a strong vehicle and my hope is to do it next year."

s.chupaska@theday.com