Program: Fairs and Expositions
All from Special Revenue Funds:
The Michigan state budget contains 20 separate line items
under Section 110 ("Fairs and Expositions") in the MDA budget, denoting exactly
where this $20 million is spent. Expenditures in this area include money to
state fair operations, prize money for fair contests, and "purses" for horse
The Fairs and Expositions section of the state budget
should be eliminated. Savings: $17,295,900. Governor Granholm’s 2005
proposal decreases the gross appropriation to $16,801,300.
The following is a list and description of each line item.
Michigan State Fair: The official fair of the
state of Michigan was the first of its kind in the nation. It was originally
held in a different city each year, but since 1905, has been located at the
corner of Eight Mile and Woodward in Detroit. Its 2003 appropriation is
 Most of the revenue for the state fair is generated by ticket
sales, but that has not always been the case. From 1970 to 1995, for example,
the fair lost an average of $2 million annually,
 which the Legislature
ultimately subsidized with additional appropriations. From 1995 to 2002, fair
attendance and revenue improved, but not by much. In 2002, the fair eked out a
 This is not a cause for celebration, however. Due to the
collapse of a lease arrangement between the state, fair officials, and a private
developer, the cost of maintaining the fairgrounds will increase by about
$900,000 in 2003, excluding necessary capital improvement costs. The state
should remove itself from fair operations entirely and sell the 200 acres of
state land on which it operates. Author’s note: In 2003, the State
Fair generated less revenue than it spent as part of its operations. Its losses
were made up with $747,000 in subsidies from the Michigan Department of
Agriculture ($255,200) and Department of Management and Budget ($491,800).
What revenue might the
sale of state fairgrounds generate? It is impossible to tell precisely without
actually selling the land. Still, a general idea of possible sales prices can be
formed by extrapolating data from the offers made on properties adjacent to the
fairgrounds. In April 2000, developer Joseph Nederlander agreed to purchase 36
acres of government-owned land adjacent to the state fairgrounds in Detroit for
$6.1 million. Before the deal was legally finalized, Nederlander sold it to
another developer, Bernie Schrott, for $10.5 million. While both of these deals
ultimately fell through, they still give an indication of what the 36 acres
might sell for. What if the parcel for sale was 5.5 times larger, as is the
fairgrounds? The potential for $57 million in one-time revenue makes the
sale of the fair land and its buildings worth exploring. Savings:
Upper Peninsula State Fair: The Upper Peninsula (U.P.)
State Fair, located in Escanaba, was not created by the Legislature until 1927.
Its 2003 appropriation is $1,214,400.
 It required a General Fund/General
Purpose subsidy of $177,900 in fiscal year 2001 to pay its bills.
The state of Michigan should remove itself from U.P. state
fair activities entirely, and the 100 acres of state-owned land on which this
fair operates should be sold. That’s because, as with other forms of private
entertainment, state fairs should sink or swim on their own merit. If there is
demand for these summer festivals, the people who value them the most will be
willing to fund and operate them without state influence. Even if the state
were to remove itself from fair involvement, it would hardly result in a dearth
of fair fun. Seven Michigan counties and another 80 communities and
associations run their own fairs, too.
 Ottawa County alone has three
different community fairs. Barry County’s Bill Ackerman has run a private,
for-profit fair for 24 years. The "Prairieville Old Fashioned Farm Days Show
Grounds" plays host to fair events every August. Animals are on display for
show and racing; there are craft shows, dancing, live country music, cow-chip
golf ball driving contests, and a "National Truck Pull" competition. It is
situated on 140 acres of land owned by Ackerman. His fair is so popular it
often fills the 3,000-space camping area set aside by Ackerman for overnight
The sale of the U.P. land would generate dramatically less
revenue than the state fairgrounds in Detroit, given the abundant supply of
undeveloped land in and around Escanaba. According to Kevin Dubord, assistant
assessor for the city of Escanaba, land adjacent to the fair sold two years ago
to Gordon Foods Inc. for $2,000 per lineal foot of street frontage. That is, it
cost $2,000 for every one of the 250 feet of land available along North Lincoln
Road, on which the Gordon Foods property, and the fair, are located. At $2,000
per lineal foot, the UP fairgrounds might fetch $2.6 million.
Other Line Items under Fairs and Expositions: In
early 2002, Gov. Engler used his veto pen to remove most of the following
expenditures from the state budget because of a disagreement over the sizes and
source of the appropriations. On Sept. 17, 2002, he asked the Legislature to
reinstate the funding at the levels he originally requested. After some
haggling, the funding was reinstated.
Fairs and Racing: This line item funds five
full-time state employees to "oversee" other fairs, particularly with respect to
how state "premiums" are used (see "Premiums — County and State Fairs," below).
It also provides assistance to county and community fairs. According to MDA
Horse Racing Analyst Bob Woodman, state employees advise fairs on how to
maintain records and help them "keep business."
 They also administer
"Michigan Bred" programs that are funded for pari-mutuel breeding programs (see
"Standardbred Sire Stakes" and "Standardbred Breeders’ Awards," below, for more
The Michigan Bred program is sold as a way to improve
Michigan horse racing by helping to subsidize Michigan "winners." Savings:
Building and Track Improvement — County and State Fairs: This is a line item to help improve
the racing tracks or buildings and grounds at Michigan fairgrounds. Savings:
Premiums — County and
State Fairs: "Premiums" are
generally used as award monies to children who win prizes for such things as
raising the best livestock, having the best crafts, or winning the "antique
tractor pull" contest, to name just a few examples. Savings: $1,614,000.
Purses and Supplements — Fairs and Licensed Tracks: According to Michigan Deputy Racing
Commissioner James Bowes, this line item enlarges the potential winnings for
horse owners who enter their animals in races around Michigan. This is designed
to improve the number and quality of races by providing a greater incentive for
horse owners to run their animals at Michigan racetracks. Savings:
Standardbred Fedele Fauri Futurity: This line item
reflects money that is appropriated to subsidize a particular race, known as the
"Fedele Fauri Futurity," at just one fair, the Kinross Fair, just outside of
Sault Ste. Marie. Savings: $70,800.
Standardbred Michigan Futurity: This line item is
also appropriated to subsidize a specific "harness" race, which was held at
Mecosta County Fair in Big Rapids in 2002. Harness racing involves jockeys
being pulled by horses on two-wheel carts. Savings: $70,800.
Quarterhorse Programs: A "Quarterhorse" is a
specific breed that is raced in Michigan in "flat back" style (that is, without
a harness and carriage to pull). The appropriation is used to subsidize the
award for winners. Savings: $34,800.
Licensed Tracks —
Light Horse Racing: This program supplements winning purses for the owners
of horses that are four years old. It is essentially an age-specific
category. Savings: $67,300.
Standardbred Breeders’ Awards: Breeders’ awards are
granted to Michigan owners of horses whose offspring go on to win a race in
Michigan. Savings: $1,082,300.
Standardbred Purses and Supplements — Licensed Tracks: The state adds
to winning purses to increase the incentive for Michigan standardbred owners to
enter their horses and compete. This line item is similar to the purses and
supplements for fairs and licensed tracks, listed above. Savings: $242,400.
Standardbred Sire Stakes: This appropriation
subsidizes the purse of a race run annually and by a specific breed of horse
that is also sired in Michigan. The finals have been held at Hazel Park Raceway
the last two years. Savings: $906,800.
Thoroughbred Sire Stakes: This is a specific race
at Great Lakes Downs in Muskegon run by a specific breed of horse that is also
sired in Michigan. Savings: $906,800.
Standardbred Training and Stabling: This line
subsidizes fairgrounds that provide stables and training tracks for standardbred
horses. Savings: $38,300.
Thoroughbred Program: This is a fairly sweeping
program that encompasses various purses and awards for owners of Michigan bred
horses. Savings: $1,586,900.
Thoroughbred owners’ awards: This program
supplements winning purses for horse owners whose thoroughbreds are Michigan
bred and obtain a certain amount of points based on their year-long racing
performance. Savings: $136,500.
Distribution of Outstanding Winning Tickets: Every
year a percentage of winning tickets from horse bets goes uncollected. Money
that would have been collected is now divided between the owners of racing
tracks and the owners of the horses involved in each race. Rather than
appearing under "Fairs and Expositions" in the MDA budget, this appropriation
could accrue to, and be distributed by, the Michigan Gaming Office.