WATSONVILLE -- A year ago, with $7,000 in its operations account and a stack of bills, the Santa Cruz County Fairgrounds' future appeared bleak.
Tuesday, with an improved financial picture, the board approved a 2013 budget that anticipates a slight increase in revenue and spending and the prospect of closing the year with $50,000 profit.
"Things are looking up, way up," said fair manager Dave Kegebein.
The fairgrounds, an agency of the state officially known as the 14th District Agricultural Association, fell into a financial hole during 2010 and 2011, when expenditures exceeded revenues and reserves were tapped out.
In addition, the state, which had traditionally subsidized fairgrounds, cut back on funding, and last year, eliminated the support entirely.
Several factors are responsible for the improvement since a team a volunteers, headed by Kegebein, took over management of the 110-acre fairgrounds and its biggest money-maker, the annual county fair.
The free management cut administrative costs by more than $100,000, giving the fairgrounds a solid boost. But revenues are projected to rise by at least $100,000 as well with the launch of a weekly farmers/flea market on Sunday and a doubling in horse shows due to the closing of a Pebble Beach Equestrian Center.
Kegebein said the farmers market alone should bring in a minimum of $70,000.
He also projected $200,000 in building and grounds rental fees, but with January not quite over, the fairground already has $165,000 in bookings for the year.
"We know we're going to do better than that," Kegebein said. "We built a conservative budget."
While on better footing, the fairgrounds still is not in the clear. If it weren't for the management team's free labor, the nearly $50,000 in projected profits would turn into a $75,000 deficit, Kegebein said.
The fair board also agreed to continue its management contract with Kegebein, for which he is paid the sum of $1 a month.
In other action, the board approved a 99-year lease of 3.82 acres to the Agricultural History Project, a nonprofit which operates a museum and living history farm on the site. The lease, which still must be approved by the state, calls for the nonprofit to pay the fairgrounds $350 a month, with an annual cost of living increase of no more than 3 percent. The existing 25-year lease is set to expire in 2015.
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