NM State Fair Insolvent

The New Mexico State Fair has been losing money for years as revenue and attendance dropped and doesn’t have enough money to pay for day-to-day operations, according to a legislative audit released Oct. 20.

Auditors for the Legislative Finance Committee said the fair, located in Albuquerque and known as Expo New Mexico, has continued to operate because it’s not paying some debts. This year’s fair ended last month.

Among the unpaid debts is $1.9 million to the General Services Department’s Risk Management Division for insurance coverage going back to 2009.

“This de facto loan from another state agency has allowed the New Mexico State Fair to have enough cash to maintain solvency,” the audit report said.

The fair, which is supposed to be self-supporting, has averaged $3.4 million in annual losses since 2006, and lost $5 million in 2010.

A proposal to save the fair includes cutting its length from 17 days to 10 days. Fair officials said they’re trying to boost revenues but agreed the fair is financially insolvent. Seventeen workers were laid off in September, leaving a staff of 36 full-time employees.

The fair has been without a chief financial officer since last year, but fair officials said a contract accountant was hired in August and improved accounting controls have been implemented.

But auditors say the fair’s lease with the Downs at Albuquerque, a horse racing track and casino, is “fraught with problems” and the fair didn’t appear to be getting a full payment. The Downs leases more than one-third of the fairground’s 236 acres, and the fair is considering a 25-year extension of the lease.

Sen. Tim Keller called the possible extension “irresponsible” and called for the governor and state legislature to revamp fair operations. “It’s structurally a failure,” he said.