AKRON – Summit County Executive James McCarthy asserts he has the right to send sheriff’s officers with chains and padlocks out to the Summit County fairgrounds Feb. 1 to evict the Summit County Agricultural Society.
And he is perfectly willing to do that.
The attorney for the agricultural society, on the other hand, cites state law, asserting the absolute right of the society to occupy and control the fairgrounds as long as it is in compliance with the Ohio Revised Code Section 1711.31.
As long as the society holds a fair every year, he said, it cannot be evicted from the fairgrounds.
McCarthy says the agricultural society is in default of an agreement it signed when the county issued bonds to build a fairgrounds arena in 1992.
The fair board has not made the required payments, he said, and the county has the right to evict the society from the fairgrounds and take control of the land and the arena.
Owes taxpayers. McCarthy said the ag society has repaid only about $110,000 of the $849,341 due, even as the county has paid interest and principal on the $1.5 million bond issue that financed the arena construction.
Records from his office indicate the society made no payment in five of the 10 years since the bonds were issued. And in no year has it made the entire payment due.
McCarthy wrote to the board about settling the debt last March. They have not answered his letters, he said.
The letter of eviction was mailed in December, giving the board notice they must vacate the grounds by Jan. 31.
“There is no chance in hell they are going to leave,” said Pat D’Andrea, the attorney retained by the agricultural society. “Not without a court order.”
D’Andrea will not discuss legal strategy and has not filed anything with the court as of Jan. 24, but going to court seems to be the course of action everyone expects the agricultural society board to take.
Worked with county. Elizabeth Hale, secretary-treasurer of the society’s board of directors and manager of the fairgrounds complex, said before McCarthy took office as county executive in 2001, she and the board had constant contact with the county.
She said she met with former county budget director Ron Brooks quarterly to review the books. He would go over the income and expenses, Hale said, and then tell the board that he would try to rework the debt.
“We never wanted to get out of the debt,” Hale said. “We just wanted to try to rework it in some way so we could afford it.”
That might have been under the old administration, McCarthy said, but “no one has met with my budget director.”
“If they had an agreement not to make the payments, it should have been taken before the council and approved. They don’t have any of that in writing.”
Bonds issued. The bonds, which totaled $900,000 when issued in 1992, were retired and reissued in 1994 when cost overruns drove construction costs to $1.5 million. Each side blames the other for increased costs and the fact the project was delayed for a year when the contractor walked off the job.
The bonds were refinanced in 1998 for a lower interest rate and, according to McCarthy’s office, payments due after that were in excess of $50,000 in 1999, in excess of $60,000 in 2000, and in excess of $70,000 in 2001.
The board made a $20,000 payment in both 1999 and 2000, but no payment in 2001.
According to McCarthy’s office, rental income from the arena was $136,000 in 1999 and $132,000 in 2000. Total rent from all fairground facilities was approximately $200,000.
Not enough. Ohio Department of Agriculture internal auditor Jeff Kalbus, who received the society’s annual financial statements and who has audited the board’s records, said these are gross income figures that do not take the fixed costs and overhead of operating the arena into account.
Maintenance and operating costs took most of that income, he said, and he doesn’t believe the arena was generating sufficient income for the board to meet the payments.
“The ag society has been very open about this,” he said. “They have made full disclosure. I don’t think they are hiding anything.”
During 2001, Hale and board vice president Rick James negotiated with county director of administration and operations Bob Holland over whether or not the fair board would receive $200,000 the county council had approved in 2000 to equip the arena for use as a sports arena.
The idea had been raised by the county as a way to increase arena revenues.
In October, the ag society discovered the county was negotiating with the city of Tallmadge to do the remodeling and then to manage the arena.
Tallmadge Mayor Chris Grimm announced early in January that the contract would be signed this month, but later withdrew the city from negotiations until the county has taken control of the facility.
Not appropriation. McCarthy said the money to turn the fairgrounds facility into a sports arena was not an appropriation to the agricultural society, but part of the county’s capital improvement plan.
“Why would I give them another $200,000 of the taxpayers’ money to spend?” he said. “They are not good managers. They have mismanaged the arena from the beginning.”
“They have taken in at least $1 million,” he said, “but when it comes to paying their bills, we are the last on their list. They entered a agreement, and they haven’t made much of an attempt to honor it.”
State requirements. The law establishing agricultural societies as the entities recognized by the Ohio Department of Agriculture was passed in 1953. Every county except one has a single county or independent agricultural society that organizes and runs a county fair and is recognized under state code.
Societies that meet requirements of the law are certified annually by the department of agriculture.
The societies are required to hold a fair each year, and to award premiums for agricultural products and articles of domestic industry, and to submit an annual financial statement to the state.
The law also established the relationship between societies and county governments. When the society receives certification from the department of agriculture, the county is required to provide certain sums of money in support of the fair. The county is also required to carry the insurance on the fairgrounds.
In authorizing the society to either own land for the fairgrounds, or to lease the fairgrounds from the county, the law states in part that:
When the title to grounds and improvements occupied by an agricultural society is in the board of county commissioners, the control and management of such lands and improvements shall be vested in the board of directors of such society so long as they are occupied by it and used by it for holding agricultural fairs.
Since 1957. In 1957, Summit County purchased a 65-acre site for the county fair and then signed a lease with the agricultural society, giving it control of the site for 30 years in return for “$1 and due considerations,” said Hale.
“We developed it all ourselves,” Hale said. “The board members cleared the site and pulled up the brambles with their own hands. We gradually improved it, paying for the buildings, raising money with the help of our supporters, organizing and running the fair.”
“We’re the ones who put our blood, sweat, and hard work into building the fair. This is so wrong.”
Charlie Call, one of the founders of the Summit County Agricultural Society, estimates the fairgrounds now has a value between $5 million and $10 million, and many of the improvements were put on the grounds by supporting groups who wanted to improve facilities, including the Farm Bureau, a dog breeders organization, and local saddle clubs.
Build an arena. In the early 1990s, the board decided it needed to build an arena.
“We intended to do it with private funding,” Call said, “and I got out and started talking to people, trying to raise the funds. But somewhere around $400,000 in pledged donations, we seemed to stall, and those pledges were mostly in goods and services.”
The board decided to go to the county.
Section 1711 authorizes the county to issue bonds for improvements on the fairground, but the law also states that before any such bonds are issued, they should be submitted to county taxpayers for approval and, if approved, a special levy be established to pay off the bonds.
There have been several cases where counties did approve a special levy for the fairgrounds, said Don Klingler, executive secretary of the Ohio Fair Managers Association. Marion County financed the building of a new coliseum on the Marion County Fairgrounds that way several years ago.
Pledged revenues. But in the case of the Summit County Fairgrounds arena, the agricultural society board pledged the repayment of the bonds out of the revenues of the arena.
Hale said the arena has been busy. Until recently, it was booked at 95 percent for weekends. It has been used for dog shows, horse shows, auto shows, gun shows, computer shows, antique shows, home shows, old toy shows, gymnastic exhibitions, truckload sales, craft sales, and even an Irish dance competition.
The most controversial event to be staged in the arena, she said, was an amateur kick boxing tournament that ended up being raided by the police.
“We learned from our mistake that time,” Hale said, “but there has been a lot of bad feeling about what happened.”
McCarthy said he thinks it is time for the county to reclaim its land and to take over the management of the facility to offer programs that are of county-wide interest.
Good public use. “We’re not out to hurt agricultural interests in this county,” he said. “But we want to make good public use of the arena.”
He anticipates they will be able to work with 4-H and other groups who are using the fairgrounds to allow them to continue.
In the meantime, the forces to oppose the county’s move are forming. The Summit County Farm Bureau has hired its own lawyers to protect its interests in the buildings and the museum it has erected on the fairgrounds.
The saddle clubs have been meeting to determine their course of action and other organizations, including the Boys Club and 4-H, have begun letter-writing campaigns.
Call has been authorized by the Darrowstreet Grange, which has put $10,000 into a youth park on the fairgrounds, to write a letter opposing the county’s action “in the strongest terms possible.”
“My opinion is that this is 90 percent political, and 10 percent financial,” he said. “These people have never been to the fairgrounds. They don’t even know what’s there.
“And if the county does take over the facility and install a new manager, I predict they will then forgive the debt.”
(You can contact Jackie Cummins at 1-800-837-3419, ext. 23, or by e-mail at email@example.com.)