7

P.O.Box 41264
Nashville,TN 37204
April 12,2009

HonorableMayor Dean
MetropolitanGovernment
100MetroCourtHouse-First Floor
Nashville,TN 37201

RE: FAIRGROUND BUDGET HEARING ON APRIL 7,2009

DearHonorableDean:

Agachedis an analysesthatwasdoneon four (4) fiscalyearson the Tennessee StateFairground.

This analyseswasdoneafterhearingthe budgethearingto promotean understanding of what
is happeningon the sitein the directionof operation.Many of us believemany itemswereleft
out andnot discussed andthereforewish to submitthe attachedanalysesfor your reviewand
understanding.

Also, an in-depthreviewof the Metro Budgetwasreviewedfrom the Metro WebSite. In the

previousyear,therewascapitalimprovements submitted,but sawnoneon this budgetof 2009. In
orderto enhancethe siteandbuildingsfor rentalusage,improvements needto be done. The reviewof
the pastbudgetshoweda capitalcontributionto O.W.SmithMusic of $500,000from the hotel/motel
ratesfor their usage,andthe communitywould like a reviewfor this FiscalYearof 2009to usethis
sourcefor $200.000to $350.000for enhancementsto the Faireround rentalbuildingsin orderto
recruitthe neededeventsto encourage successof the facility. This hotel/motelratehasbeenrestricted
for public entertainmentfacilitiesandtourism,which would fit perfectlyin regardsto the missionand
objectiveofthe Tennessee StateFairground.

Any inquiriesof the attacheddatacanbe sourcedbackto the the FairgroundAdministrationfor which

the datawasobtained.The fact thatthe Tennessee StateFairgroundis generatingapproximately
$4 million dollarsper yearis showinga definitivefuturefor its own growthandcurrentmainstay.

Many thanksfor your time in reviewingthis informationandhopefully,a betterclarificationof

whatthe Fairgroundsiteis doing canbe understoodandsupportin promotingwhatthe communitysees
asa rich sourcefor all toolsof eventsfrom agriculture,greenpower,activities,races--bicycle,
vehicles,horseshows,etc.,andeventsthat wouldbe Metro/County-wide in usageandparticipationfor
its purposeasalreadydefinedin StateStatueandrestricteddeeds..

Yot6struly, r-'1

,W
FairgroundSupporter
andMemberof FairgroundHeritagePreservationGroup
DC/Copies:Mr. R. Reibling--MetroFinanceDirector
of TN StateFair
Mr. BuckDozier---Director
Directorof TN StateFairground
Mr. Ken Sanders---Assistant
BudeetandFinanceCommittee
Committee
*I Fuir CommitteeandTourismandPublicEntertainment
andFair Board
Attachment:OnePageof four (4) yearsanalyses
This letteris a follow-up from the budgethearingthat took placeon Tuesday, April 7, 2009
regardingthe FairgroundBudgetHearing. Basedon the hearingandpresentationthat took
place,we, ascitizens,of DavidsonCountyandFairgroundSupporters, wish to presentfacts
so thattherewill be no misunderstanding or misgivingof what is actuallyoccurringin the
processof theTN State Fairgrounds---thathasNashvilleHistoryof over onehundred(100)
yearsthat probablyno other City/Countycould marketfrom. With this said,the following
figuresarebeingsubmittedfor comprehension of the decisionmakersto review andsee
whatthe Fairgroundsis doingfor the Community,the people,andcitizensof DavidsonCounty.
-.-.TEI[II-ESSEESTATE FAIRGROT]hIDANALYSES-. FOUR FISCAL YEARS
--RevenuesReceived Variances
FiscalYear2008* Fiscal Year 2007 Between2007& 2008
$ 3,586,605.32 -Total Revenues -Total Revenues
$ 3,879,929.48--- (7.7s%)
- - -F
1,303,602.92 leaMarket .14-------FleaMarket
1,409,247 (8.10%)
I 86,835.83----Concessions 216,510.56 Concessions (r3.7r%)
727,707 .18---Rentals 759,513.01 Rentals (4.1e%)
1,337,324.05----Fair 1,450,928.49----------
Fair (8.4e%)
31,135.34----Misc. 43.730.28- Misc. (28.80%)
$4r053,595.35-OperatingExpenses $3,784,586.15----------Operating
Expenses
Variances
2005& 2006
Between
Fiscal Year2006 Fiscal Year 2005**
S 3r7271539. I 4--------TotalRevenues $ 3,619143.72---------Total Revenues +2.99yo
1,441,257 .25----FleaMarket 1,464,266.17- -------- FleaMarket (r.60%)
194,9ll .61-----Concessions | 831646.82---------Concessions +5.$Vo
750,3I I .67----Rentals 739,560.10------Rentals + 1.5% o
1.302.337 .32----Fair 1,199,092.23------ Fair +9.20%
38.721.29------Misc. 32.578.40------- Misc. +t9.00%
$ 3,689,686.46------OperatingExpenses$ 32921522.23------- OperatingExpenses
NOTE: Not Included----*2008--ResenveFund not an'(operatingreyenue"-----**2005---Loss on
F'ixedAssetnot an "operatingreyenuet'.
Assumptions: (l) Betweenthe Yearsof 2007and2008,economicfactorssuchashigh guscosts,
weakconsumerspending,andbank failureshavehad impacton the marketsand suchfactorscauseda
reductionin variancedifferences.Plus(+) is a *Gain" andBracket( ) is a "Reduction". TheAnalyses
is a wrap-upof all the abovefiscalyearsto June30, XXXX.
This Reportanalysiswasdividedinto five (5) categories--Flea Market.Concession. Rentals-which
makesup races,equipment,/supplies, andBuildings---FairandMiscellaneous.Basedon the above
analysisof generatedrevenues,the Flpa Market andthe Fair aremaintainingtheir own sustainability,
while the rentalshavean adverseaffecton the overalloperationof theFairgroundEvents/Bookings.
The newsmediaof the Tennessean indicatedthatthe Fair lost revenuesis not a true fact in that all
the figuresand amountswere not in for recordingandpostingaccordingto GAAP & Metro Accounting
ProcessandProcedures.Therefore,the amountsat the time were not a completeand accuratepicture.
Onecouldconcludefrom the abovethatthe Operating Expenses(PersonnelCosts.Printing.
Advertising & Promotion [Variable Costsl areoverridingthe generated revenues,which shouldbe
recordedin the Enterprise Entity Fund---not general fund,by apnroximately13 7o andan in-depth
analysesneedto be doneto focuson a reduction in costto maintainmoreof the generated revenueto
for
operateon a moreeffrcientandeffectivebases "Success".
Recommendation--(A) ReduceCostsby ten (l0%)Percentand (B) AnalyzeRentalRatesfor an
approximateten (10%) to fifteen (lS%)percent increasealong with community sponsorships.
Source: FinancialStatements of Tennessee StateFair---Metropolitan AdministrativeOffices-
DC [ProfessionalFinancial Analystl/4-Il -2009