Outside Illinois, fair business varies
Amid an epic state budget impasse that has curtailed social services and upped the state’s backlog of unpaid bills past $8 billion, the Illinois State Fair thrives.
Claiming poverty, Gov. Bruce Rauner shut down the state museum and cut funding to preserve the papers of Abraham Lincoln, but when it comes to corndogs and butter cows, the band plays on, despite deep deficits in state fair bank accounts. In recent years, the fair has lost millions of dollars – the state auditor general says that the deficit between 2001 and 2013 surpassed $45.8 million, with annual losses routinely topping $3 million on spending that reached nearly $10 million in 2013, the most recent year that audited records are available from the auditor general.
Politicians haven’t panicked. “There’s no spending authority for the state fair, but I’m going to be there anyhow because I enjoy going to the state fair,” House Speaker Michael Madigan, D-Chicago, quipped last year, when the state’s failure to pass a budget had some pundits asking how the fair could go on. Although vendors were paid late, the fair survived, and this year’s fete is being funded as part of a stopgap six-month state budget.
Supporters say that the fair is vital. While fairs in several states are run by private organizations, the Illinois State Fair should be run by the Department of Agriculture, fair lovers say.
“It (the fair) creates a sense of pride in the state that I think is something we’re sorely in need of right now,” says state Rep. Tim Butler, R-Springfield. “Could it be run in a different way and managed differently? I don’t see the need.”
The fair continues because a statute says that the state must hold annual fairs in Springfield and Du Quoin, the latter festival aquired by taxpayers in 1986, when losses threatened a shutdown of the downstate fair that had been privately managed since its inception in 1923 by a horse breeder who wanted a venue for horse racing.
The recent past hasn’t been kind to fairs elsewhere, as policymakers in other states question whether government should be in the fair business. Faced with annual losses of less than $400,000, a fraction of what the Illinois State Fair loses each year, the state of Michigan in 2009 ended the 160-year-old Michigan State Fair, which had been the nation’s oldest state fair. The Michigan fair was resurrected under private ownership in 2012, with attendance less than half of the numbers recorded at the last state-sponsored fair, which drew nearly 220,000 people in 2009. Similarly, the privately run Nevada State Fair, established in 1874, folded in 2011 amid financial problems but was reestablished this year by a new private group. In New York, the state is considering privatizing its state fair even as the state is spending $50 million to renovate fairgrounds in Syracuse.
“There are private sector companies that run fairs, that run concerts,” New York Gov. Andrew Cuomo told the media last spring in announcing that the state would seek proposals from private entities interested in taking over the fair. “There’s a private sector expertise that we frankly don’t have.”
Mark Lovell, owner of Universal Fairs in Tennessee, says he’d love to take over fairs in New York and Illinois. He vows both states would be better off financially.
“I would buy the New York State Fair if it was for sale,” says Lovell, who’s been in the fair business since 2007, when he established the Delta Fair and Music Festival near Memphis. “I’d buy the Illinois State Fair and keep them from wasting money. … I could probably put on the best damn fair they’ve ever seen. If they’re tired of losing money, just hand me the reins. I won’t make them a lot of money but I’ll stop the bleeding.”
Universal Fairs runs a half-dozen fairs across the nation and is known for rescuing, or buying out, struggling fairs. In 2012, Lovell bought the financially troubled Virginia State Fair from a private nonprofit group for $5.7 million, took on the Virginia Farm Bureau Federation as a partner, then sold out to the farm bureau after a year. It was, he says, a profitable venture.
Greg Hicks, spokesman for the Virginia State Farm Bureau Federation, said he believes that Virginia is the only state in the nation with a state fair owned and run by a farm bureau. The fair has turned a profit every year except last year, when a hurricane threat forced the fair to close three days early, he said.
“People come year after year,” Hicks said. “It all boils down to good weather. If you don’t have good weather, people aren’t going to come.”
Unlike the Illinois State Fair, the Virginia State Fair is close to a major freeway and within driving distance of Washington, D.C., and Richmond, Virginia, both large population centers. That helps, Hicks allows.
“It’s easy to get to,” Hicks says. “Everyone knows where we are.”
When it comes to making money at fairs, Lovell is a fan of demolition derbies but not grandstand concerts with separate admission fees. Kiss is a great band, he allows, but Steppenwolf is a better choice for fairs because you can fold the price of a performance into the price of a $10 fair admission ticket.
“All of our shows are free,” Lovell says. “If you want to be in the concert business, be in the concert business; if you want to be in the fair business, stay in the fair business.”
In Illinois, Gov. Bruce Rauner this week announced the establishment of a private nonprofit foundation that will raise money to fix roofs and otherwise address $180 million in deferred maintenance at state fairgrounds, mostly in Springfield. The announcement came after the Democratically controlled General Assembly declined to establish a foundation. Unions have raised concerns that a foundation might bypass state procurement procedures that could boost costs by requiring that workers be paid prevailing wages under federal labor law. Rauner didn’t directly answer when asked at a press conference whether the foundation will follow state labor rules “That’s a question for everybody to sort out under existing law,” Rauner. “Every organization will follow existing law.”
The private foundation will decide how money will be spent, Rauner said, although he also told reporters that the Department of Agriculture will be consulted.
“It’s their money,” Rauner said. “They’ll decide how much to raise and where it should be allocated.”
Department of Agriculture spokesperson Rebecca Clark noted that fair admission prices were increased this year, from $7 to $10 for an adult, in an effort to improve the fair’s bottom line. The increase brings Illinois in line with ticket prices at other Midwestern fairs, she wrote. In addition, the fair this year charged admission for the night of the opening parade, which has traditionally been free. And the state has already recouped its costs for this year’s grandstand shows, she said.
“We are working to make the Illinois State Fair more sustainable for generations to come,” Clark wrote. “At the end of the day, the Illinois State Fair is still one of the least expensive fairs in the Midwest.”
Contact Bruce Rushton at brushton@illinoistimes.com.
