The Los Angeles County Fair Assn formed in 1940 “to promote the region’s then-booming agriculture industry,” says the Los Angeles Times. “But over the years, it morphed into something resembling a conglomerate with little connection to farming or livestock. And its managers have become richly compensated even as the association loses money.” The fair association operates a hotel and conference center, a catering company and an equipment rental service, all on the county-owned fairgrounds in Pomona. As a result, it doesn’t have to pay property taxes and as a nonprofit, “it also is exempt from taxes on most of its income,” says the newspaper.
As a result of the investigation, the “Board of Supervisors on Tuesday ordered an audit of the Los Angeles County Fair Assn. and called for a possible renegotiation of the organization’s long-term lease,” the Los Angeles Times said in an update.
James Henwood, the fair’s chief executive, was paid more than $894,000 in 2013, the same year the association lost $3.4 million, said the Los Angeles Times. Four other officers were paid more than $300,000 each. By comparison, the managers of other large county fairs in California were paid less than one-third or one-quarter of Henwood’s salary.
“Unlike most major fairs in California, L.A. County’s is not run by a public agency,” said the newspaper. The Los Angeles Times quoted a former IRS official as saying the fair association was so removed from agricultural pursuits that it was a fair question if it qualifies for tax-exempt status. “In an email to The Times, association spokeswoman Renee Hernandez said the organization has embraced the ‘evolution’ of Southern California agriculture, as represented by competitions for wine, craft beer, extra virgin olive oil and dairy products. She said the association has increased the number and variety of animals at the fair, although she did not provide details.”