The Orange County Fair Board on Thursday denied a $ 5 million loan request from the Del Mar fairgrounds, noting that the state’s fairgrounds are in financial difficulty with little chance of rebounding soon. as the number of coronavirus cases continues to rise.
“The uncertainty about the economics of this (…) makes it very difficult for us to spend this amount of money without knowing for sure that it would come back,” said Nick Kovacevich, one of the two members of the Orange County Board of Directors on an ad hoc committee that investigated the request.
For memory :
6:00 p.m. July 24, 2020This story was clarified to say that the 22nd District Agricultural Association will not receive any state funding until July 31, and the money will only be used for salary expenses related to employee layoffs.
A delegation from the 22nd District Agricultural Association, which operates the Del Mar Fairgrounds, visited its neighbor in Orange County, the 32nd District Agricultural Association, in May to ask for financial assistance. Unable to host the annual San Diego County Fair and other big events, the 22nd DAA expects a 90% drop in revenue this year. The district plans to lay off 60% of its staff on October 15.
The Del Mar Fair board also appealed to Governor Gavin Newsom in April for emergency aid worth $ 20 million. Since then, Newsom has included $ 40 million in the state budget to be shared by the state’s 54 district agricultural associations, all financially suffering from the pandemic. The 22nd DAA expects to receive approximately $ 1 million in money as of July 31, and it will be distributed monthly as a reimbursement for payroll and payroll-related expenses (such as unemployment, paid vacation, social benefits and retirement) for fairground employees affected by layoffs.
“It is certainly not the 20 million dollars that we asked for, but it is a contribution to our overheads,” said chairman of the board, Richard Valdez, on Thursday.
Another possibility arose on Thursday, when a congressman from Central Valley introduced a bill that would create a $ 5 billion grant program to offset losses from coronavirus at nationwide fairs. If approved, states could apply to the US Department of Agriculture and then distribute the grants to fairs in their state.
Meanwhile, cases of the new coronavirus continue to climb in the United States.
California reported a record 12,807 new cases in 24 hours on Wednesday, Newsom said. The Golden State overtook New York this week and now has at least 413,000 confirmed coronavirus infections, more than any other state.
San Diego County had 25,608 confirmed cases of COVID-19 and 512 deaths as of Thursday, according to county health officials. Hospitalizations were down sharply in Thursday’s county COVID report, but officials said a technical issue unintentionally ruled out hospitalizations at some facilities across the state. The problem should have been fixed by the time Friday’s report goes out.
Fairgrounds across the United States are suffering financially from COVID-19 bans on large gatherings, but the Orange County district is in better shape than many. It has consistent sources of income, no significant debt, and reserves of nearly $ 50 million.
Still, Orange County is running out of reserves and now is not the time to lend money, Kovacevich said.
“Lending the $ 5 million would have a negative effect on our own morale, given that we have pay cuts, and it’s a tough time for everyone,” he said.
A speaker at Thursday’s virtual meeting, Orange County resident Mike Robbins told the board that since the fairgrounds in both districts are state-owned, the 32nd DAA is expected to lend support. ‘money to the District of San Diego.
“It’s not your money, it’s the people’s money,” Robbins said. “It’s about stepping up, doing the right thing.”
But no one on the Orange County Board of Directors backed the idea.
“We understand the dilemma of the 22nd DAA, but unless things change dramatically we’ll have $ 32 million in cash,” said Director Doug La Belle, who served on the ad hoc committee with Kovacevich.
Instead of loaning the money, La Belle said the Orange County District should work with the 22nd DAA and “the whole fair network” to help them get through the economic crisis.
The 22nd DAA has virtually no reserves and about $ 74 million in debt. Some of that money was for the grandstands that were rebuilt in the early 1990s, and some for the ongoing remodel to add a concert and performance hall to the Surfside Race Place off-road betting complex.
Now the district is looking for multiple ways to make up for its ongoing losses. It rented a parking space this spring from car rental companies to store thousands of vehicles in their idle inventory, and since June regular food vendors have been selling turkey thighs, kettle corn, cinnamon buns and other favorites for drive-thru customers.
Also on the table is a proposal to lease a fairground property to a company that would operate temporary housing for homeless veterans and their families. Gov. Gavin Newsom suggested in his state of state address in February that state-owned properties, including fairgrounds, could provide solutions to the homeless and called on local agencies to ‘investigate.
The housing concept has drawn widespread opposition from residents of Del Mar and Solana Beach, who say the idea is inappropriate and poorly planned. More details and perhaps a decision are expected at the board meeting in August.
Valdez had read the Orange County committee’s recommendation that the board not lend the money, so Thursday’s decision came as no surprise.
“We understand that they are worried about what is going on with COVID,” he said. “We appreciate their willingness to consider (the request) … and appreciated the conversations we had.”
The 22nd DAA and other California District Farm Associations do not receive tax money and depend almost entirely on income from major events such as county fairs, exhibitions, and other shows to stay open.
Some fairs could be forced to shut down permanently or even sell their fairgrounds if they do not receive financial assistance, said U.S. Representative Josh Harder, a Democrat from Modesto, who presented the Protecting Fairs grant program on Thursday. Coronavirus Act.
“We don’t want to lose a single acre of fairground or see a single fair closed for good because of this pandemic,” Harder said in a press release. “I went to the Stanislaus County Fair as a kid and even won blue ribbons along the way – but these fairs are more than family fun – they are an economic engine and creators of the world. jobs for rural communities. We must do all we can to protect them. “
In a typical year, California fairs generate $ 3.5 billion in revenue and contribute $ 200 million in tax revenue to state and local governments, according to the California Fairs Alliance.