PIERRE — A legislative committee has temporarily blocked a proposal that would have increased the price admission to the South Dakota State Fair, arguing that the methodology of deciding how much to increase admission seemed flawed.
The interim rules review committee, which meets at the South Dakota State Capitol in Pierre to discuss and take action on administrative rule changes that aren’t necessarily altering codified law, made their decision Tuesday during a regular meeting.
The South Dakota State Fair, which falls under the oversight of the state’s Department of Agriculture and Natural Resources, sought the committee’s permission to adopt a rule change that would increase daily adult admission to the fair from $6 to $10 and youth tickets from $4 to $5.
In her pitch, Peggy Besch, fairgrounds manager of the South Dakota State Fair, told the committee that the rising costs of conducting business are affecting the fair’s bottom line.
“While the South Dakota State Fair continues to experience success, the cost of conducting business continues to rise. Admission prices at the South Dakota State Fair haven’t increased in seven years,” Besch said. “With the increase in wages, especially in skilled and contracted labor, the rising cost in materials, repairs, construction costs and an increase in operational costs … it’s challenging to maintain the level of service our customers and visitors who come to fairgrounds expect.”
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Conducting an operation as large as the state fair is no easy task, Besch said, adding that the costs are constantly on her mind.
“I would speculate that most people don't give much thought as to what it takes or costs to put on a fair and maintain the facilities. In my world, as a state fair manager, I think about the costs everyday,” Besch said. “In addition to the normal expenses all businesses have to pay, such as water, heat, lights, power, fuel and so forth, there are a lot of other costs we have to consider.”
Besch listed to the committee a few of the 300 seasonal workers her organization is tasked with funding, including building superintendents, electricians and plumbers, sanitation crews and first-responders.
That doesn’t even begin to cover entertainment costs.
“We also pay for all the judges, we pay out over $100,00 in awards and premiums, there’s over $100,000 allocated to the state 4-H to aid with their programming for the fair, we pay for all live entertainment including six free stages of entertainment plus free-roaming entertainment, we pay for garbage removal, manure removal, equipment rental, dust control, we pay for cleaning and janitorial supplies,” Besch said. “The list goes on and on.”
As part of the request, Besch said additional money from higher admission prices would be directed toward a growing list of projects that need attention on the fairgrounds.
“In addition, with 190 acres and 100-plus buildings, the state fair maintenance and repair project list is extensive, consisting of infrastructure improvements to simple cosmetic needs, such as scraping and painting, all of which require money and human capital,” Besch said.
Based on the state fair’s average attendance, which was provided to the legislative committee, Besch said the ticket price increase would account for roughly $280,000 in additional profit each year. That number made some legislators question how fair officials arrived at the admissions rates that they did.
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“I’m interested in how the percentage amount was calculated,” said Sen. Jean Hunhoff, R-Yankton. “Why a $4 increase, from $6 to $10? Why not a lesser [increase]? Or, how was that amount determined?”
“I’m not sure that I have a good answer for that, other than there was a whole lot of deliberation about a variety of different means of increasing admission,” Besch answered. “We had a lot of discussion about whether it be a flat $2 or $3, whether it’s adults or youth. We established a subcommittee and, again, I will tell you there was a lot of deliberation and we just settled on the 20% increase for adults and just a dollar increase for the youth.”
In response to a followup from Sen. Red Dawn Foster, D-Pine Ridge, Besch admitted she can’t firmly say the proposed increase was based on cost.
In a separate line of questioning, Rep. Kevin Jensen, R-Canton, pointed out that the increased cost, which also applies to campers, who get four admission tickets as part of their campsite reservation, would disproportionately affect 4-H students and families, who often camp at the fair.
“To me this is extremely troubling,” Jensen said. “This is a whole $280,000 increase [in ticket sales]. The vast majority of it is going to fall on the 4-H families.”
Other legislators took issue with why the proposal wasn’t submitted as part of the fair’s annual budget, which is run through an appropriations process each year.
“In my opinion, the rules review process is complete, and there isn't a basis for a reversion under SDCL 1-26-4.7,” said Sen. Tim Johns, R-Lead. “I understand what all the concerns are, but I’m hesitant to revert it at this point.”
“If you’re going to look for an increase, we should see that in your proposed budget for the next fiscal year,” Hunhoff added.
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In a 4-1 vote, the committee sent the proposal backwards in the administrative rule change process.
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