Personnel cuts could be an option as State Fair looks to financial stability after a disastrous year – Grand Island Independent

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DONIPHAN — Before a hearing by members of the Nebraska Legislature’s agriculture committee, lawmakers received a briefing from Nebraska State Fair board member Jeremy Jensen.

The Agriculture Committee is the Legislature’s oversight committee for the State Fair. The committee’s visit to Central Nebraska provided a “perfect opportunity to touch base with the fair board”, according to Sen. Steve Halloran of Hastings, who is chairman of the committee.

This year was the 150th anniversary of the Nebraska State Fair. Still, both attendance and revenue were down after it was hit by torrential rains. Jensen said the rain caused unbudgeted expenses as they had to shuttle fairgoers to Fonner Park. The heavy rain made parking impossible at the grass parking lots.

To get fairgoers to Fonner Park, the fair board had to add more buses to the shuttle route, which created a substantial unplanned expense. This year, 23 buses shuttled fairgoers. Between 80% to 90% of fairgoers arrived at the gate via shuttle buses from six Grand Island locations.

The loss of revenue because of the rain put the State Fair in a financial crunch. To address the need to pay their creditors, the board member approved a motion by Jensen to apply for a $1.5 million line of credit with Five Points Bank.

Also adding to the revenue loss was lower attendance. State Fair, attendance was 283,468, which was down 10% from 2018 (314,805). That caused a 12% decline in gate revenue from the previous year.

Jensen said Friday was a good overview for the senators in gaining additional insight on the impact the weather had on the Fair, along with the achievements it accomplished. He also said it was an opportunity to tell the lawmakers how the State Fair is planning for next year’s event despite its financial difficulties.

Jensen said he told the senators that cutting expenses will be on the table at the fair board’s meeting Friday.

“Looking at things from a budget standpoint, it was a bad year,” Jensen said. “When we looked at the amount of revenue that was projected with the 150th celebration, we felt that attendance would be high. On top of that, from a programming point, we made a lot of commitments. When all those things don’t align perfectly, from a financial standpoint, that put us in a bad position.”

Jensen said moving forward to next year’s State Fair, “It is going to be more about cost control and taking a look at ways that essentially plan for the worse but hope for the best because we want to make sure that we maintain ourselves in a solid financial footing as we move forward.”

One of those areas he said the fair board might consider is reducing the staff.

Jensen, who chairs the fair board finance committee, said, “I need to make sure that we do a great job and that we make sure that we are balancing our books.”

“So, when I looked at things and was really able to understand where a lot of that cost was coming from, personnel was a really high item, whether it is with government or any organization,” he said.

Jensen served as Grand Island Mayor for one term before deciding not to run for re-election last year. Earlier this year, he was appointed to the Nebraska State Fair board.

He said the State Fair is paying $133,000 per month in personnel costs for the calendar year. Jensen wanted to examine that more.

“When you have $1.6 million as soon as you roll out of bed on the first of January knowing what you are going to pay, that is a lot of tickets we are going to have to sell during those 11 days of the fair,” Jensen said.

While he has discussed personnel cost with State Fair Executive Manager Lori Cox, Jensen said nothing has yet to be formalized when it comes to board action next Friday, where the budget will be on the agenda.

“I think in the grand scheme of things, we will probably see about $700,000 of reduced expenses from a personnel standpoint so we can be closer where we need to be to make sure that we are financially in good shape each and every year,” Jensen said. “If we have really good years, then that is great, and we will be able to put money in the bank to move forward as we have to plan for the worse and hope for the best.”

While nothing has been decided about State Fair personnel, he said, “When you have 20 full-time people, I just don’t think that is sustainable. I am just one vote, but I think the executive leadership understands that they must be good stewards of the money also. If you are looking at it from a business standpoint and you look at the cost attributed to that, I just don’t think having a staff as large as we have. Some of those full-time positions may be eliminated.”

Jensen also said that it is an ongoing discussion among fair board members about Cox’s future as fair director. Her contract is up in January.

“We have had a lot of closed-door meetings to talk about personnel,” he said. “I don’t think it is a secret that not all the board is in agreement with what the ultimate decision needs to be there.”

As of now, Jensen said, Cox is the executive director of the State Fair and “She is making plans to move ahead on the 2020 fair.”

“At the end of the day, when I analyze the situation, I think to myself what could we have done better to plan,” he said. “Then, looking forward, ‘Is Lori the person that we want guiding the ship at least for the next year,’ and as of right now, that answer has been yes.”

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