1. 1 State Fair Park Legislative Audit Bureau November 2004

2. 2 Overview u Governed by the 13-member State Fair Park Board u Funded primarily by program revenue from the annual State Fair u An unqualified audit opinion was provided for the FY 2001-02 and FY 2002-03 financial statements

3. 3 State Fair Park Finances u State Fair Parks total annual expenses have exceeded revenues since FY 1999-2000 u Total expenses exceeded revenues by $4.5 million in FY 2002-03

4. 4 State Fair Park Building Program u Recent construction includes: –a new grandstand for the Milwaukee Mile racetrack –the Wisconsin Exposition Center –new and remodeled livestock and agricultural buildings u Building costs from FY 2000-01 through FY 2002-03 totaled $76.7 million

5. 5 Milwaukee Mile u State Fair Park began managing the Milwaukee Mile internally in 2003 u State Fair Park projected a 77.7 percent increase in racing revenues and a profit of $70,700 for 2004

6. 6 Milwaukee Mile u The Milwaukee Mile added two major events in 2004, but racing revenues did not increase u Racing expenses have exceeded revenues: –$ 341,700 in 2002 –$ 693,600 in 2003 –$2,500,000 in 2004

7. 7 Wisconsin Exposition Center u Funded with $44.9 million in industrial revenue bonds issued by the City of West Allis u The Exposition Center reported a net loss of $1.5 million in 2003 u State Fair Park has received no rent from the Exposition Center

8. 8 Wisconsin Exposition Center u The Exposition Center Board hired a president in 2003 u The Exposition Center projected a net loss of $206,500 for 2004 u If revenues do not increase, the Exposition Center will be unable to pay all expenses in 2005

9. 9 Pettit National Ice Center u The Pettit Center reported a net loss of $477,800 in 2003 u The Pettit Center projects an $800 profit in 2004 u In FY 2003-04, State Fair Park expenses for the Pettit Center exceeded revenues by $380,000

10. 10 Debt Service Costs u Annual debt service payments for fairground facilities through FY 2012-13 will be: –$3.4 million for State Fair Parks program revenue-supported construction –$2.5 million for the Exposition Center –$2.0 million for State Fair Parks GPR-supported construction

11. 11 State Fair Park 2004 Condition u Complete business plans for 2005 have not been provided u State Fair Parks FY 2003-04 expenses are estimated to have exceeded revenues by $1.7 million

12. 12 Future Considerations u 2005-07 biennial budget request is pending u Assess the Parks ability to fund future capital projects with program revenue u Determine level of state support u Determine the fairgrounds management structure

13. 13 State Fair Park Legislative Audit Bureau November 2004