EDIT: Floated items do not take up any space. So even though you have a bunch of .gallery-item divs in there, they are not making the container have a height since they're floated. You need to clear the float. The easiest way is to add a div after the last .gallery-item. Give it the css of clear:both;
On line 555 of your stylesheet where you have .widget-area, add:
background-position: bottom center;