9/23/2009 10:35:00 AM Fairgrounds gets new lease on life with USDA loan approval
Gary Spiker, general manager of the fairgrounds and Yavapai Downs since late May, 2009, said there is new hope and excitement at the organization.
File Photo/Sue Tone
A new fair association is close to closing on a $13 million loan package to keep Yavapai County Fairgrounds and the Yavapai Downs afloat in Prescott Valley.
The new Yavapai County Farm & Agriculture Association will purchase the fairgrounds and Yavapai Downs from the current Yavapai County Fair Association. Attorney Chris Kottke, who helped craft the new association, said a YCFAA board of five trustees will run the organization.
"What we wanted was a good business head, and all these guys have that," Kottke said. "The goal here is that the new organization acquires the fairgrounds and track and partners with the YCFA and all of its members, knowledge and history. They will have a joint board meeting to define their roles and how to go forward. But the YCFAA is duty bound to manage the funds."
The new YCFAA trustees include Kevin Keighron, Larry Ridennoure, Rod Cordes, Jeff Wasowicz, and Charles Krause.
"I'm excited about the five person board," said Gary Spiker, fairgrounds general manager. "We will be meeting a minimum of monthly, and we're in the process of talking about mission and vision. They will make the major decisions on money, and give me parameters. They are all excellent business people and I'm looking forward to that."
The loan package, from the United States Dept. of Agriculture, is at a 4.375 interest rate over 40 years, although that is subject to change if interest rates go down before the loan closes, said Gary Mack, business and cooperatives program director for USDA Rural Development in Arizona.
In 2001, when the fairgrounds moved to Prescott Valley, the fair association received a $10.45 million loan from the Dept. of Agriculture's Rural Development Administration Community Facilities program to help continue development. USDA guaranteed the loan, but it was from a private bank. In February 2009, interest rates went up to 6.75 percent on the $8 million that YCFA owed to the bank.
In a continuing recession, the Fair Association could not pay its obligations at the new interest rate, and foreclosure became a possibility, according to a Sept. 15 news release from Rep. Ann Kirkpatrick's office.
Kirkpatrick worked with the Fair Association and the USDA to develop the idea of forming a new organization to purchase the fairgrounds at a much lower interest rate.
Kottke said Kirkpatrick spearheaded all the groundwork with USDA.
"It would have been much more difficult for YCFA and this new organization to cut through the red tape and make this happen this fiscal year," he said.
USDA recently sent YCFAA a letter of conditions, to which the organization responded that it could meet, and Kottke and Mack said the loan could close in early October.
"It looks good now, but we have to go through the machinations of government," Mack said.
He is happy about helping to put the fairgrounds back on solid footing.
"No one wants to see a big white elephant sitting out there. (The fairgrounds) provides good jobs, and brings people to the community. That's something we try to do, create employment and make something people can be proud of in their community," he said.
Kottke said he is happy that people were able to work together to make the loan happen, and he foresees good days ahead for the fairgrounds.
"The old group had one arm tied behind their back for years and years. I have read the audits from a firm out of Phoenix, and the problem is they never had enough money in the bank to do the things that the people of the Quad Cities expected. Now, with the lower terms of the loan, they should be able to do all those things, because it will free up money for operating expenses. We have a lot to be excited for in the next year or two as we come out of (the economic downturn). The fairgrounds is a diamond in the rough, and we'll see it shined up and something to be proud of.
"The bottom line is it's about effort and all of us pulling on the rope in the same direction," he said.
Spiker said that since news of the loan's approval has come through, there is a new excitement at his organization as it prepares for the annual Yavapai County Fair.
"The loan has helped get us to this point, and I have to move forward from here. Right now there is new hope, and every event we've done has been positive," he said.
He added that people can expect a spruced up fairgrounds at this year's Oct. 1-4 event, with more vendors, a better surface for the carnival, and outstanding entertainment.
