State Fairpark’s finances looking up even as auditor dings management for lax oversight of employee expenses

(Rick Egan | Tribune file photo) The Star Tower an the Ferris Wheel light up the night, at the Utah State Fair, on a busy Monday, Sept. 10, 2018. A new financial statement said last year's State Fair was a "fantastic" success, with attendance up and admissions receipts nearly double the year before.

The 2018 Utah State Fair was a big hit — increasing attendance 10 percent last year. But the Fairpark’s real success was in holding events outside the fair, allowing it to nearly double overall admission receipts.

The State Fair Corporation’s annual financial statement released Tuesday by the State Auditor’s Office uses words like “stellar," “fantastic,” and “one of our most successful years in history.”

Long troubled by shaky finances, the publicly owned Fairpark, now the beneficiary of a new 10,000-seat arena, appears more stable than in many years, with operating revenues — from fair admissions, concessions, building rentals, parking and other streams — topping operating expenses. Admissions brought in $2.2 million, compared to $1.4 the previous year.

Add in more than $2 million in state appropriations last year, and the Fairpark’s financial outlook is downright rosy, $3.4 million in the black.

Nevertheless, the State Auditor’s Office dinged the management for lax oversight in reimbursing employees’ expenses. In the sample of transactions reviewed nearly half did not have required documentation and just over 40% were made outside established purchasing procedures, such as with a personal credit card.

“A weak internal control environment could subject public funds to fraud, abuse and waste,” the audit warns.

The Fairpark Corporation acknowledged the mistakes and said it would update its expense review practices “immediately.”

Executive Director Larry Mullenax said last year was a tipping point in running operations in the black. Much of the improvement has been a result of events outside the State Fair, including concerts, Latino rodeos, and more.

“We’re very customer focused and responsive,” he said of the corporation, which is registered as a 501(c)(3), but still is an agency of the state.

Meantime, the corporation believes it can achieve even better results in the future.

“The Fair Corporation is optimistic that the increase in population, a strong economy, and gentrification of the Fairpark area will support growth in non-fair events," the financial statement said. "New strategic relationships combined with a targeted marketing approach will increase fair attendance and revenue.”

Mullenax said the corporation’s goal is getting to a point where it requires no state subsidies. That still remains a few years off, in large part because of the pressing need to catch up on deferred maintenance of the aging buildings at the park.

The 10,000-seat arena completed in 2017 was financed by $10 million from the state, $3 million from the city and county and $3 million from The Church of Jesus Christ of Latter-day Saints. The Fair Corporation doubled its spending on professional entertainment last year, up from $627,000 to nearly $1.2 million.

Mullenax said the new arena and the high-profile events held there have played a big role in improving the Fairpark’s image in the public eye, its ability to draw events and its bottom line.

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