The county Board of Supervisors Tuesday ordered an audit of the nonprofit association that runs the county fairgrounds in Pomona following a published report that the group’s CEO was paid $900,000 in a money- losing year.
Supervisor Hilda Solis recommended the audit, saying the county is renegotiating its lease with the Los Angeles County Fair Association.
Solis asked the county’s auditor-controller to “fully review the relationship” and look at all funding sources, the governance structure and whether it was compliant with regulations governing nonprofit organizations.
Solis also asked the county CEO to look at amending the ground lease arrangement for the fairgrounds to “fully maximize revenue payments.”
Supervisor Michael Antonovich called the revenue paid to the county “anemic” and the compensation paid to managers “excessive.”
“It’s out of whack,” Antonovich said.
The nonprofit association that runs the fairgrounds was established decades ago to manage the county fair. Its operations have expanded to include a hotel and conference center and a catering company, the Los Angeles Times reported.
Despite millions of dollars in government subsidies — including a county rent rollback in 2007 — and a nonprofit tax exemption, the group lost $6.25 million from 2010-2013, according to the newspaper.
In 2013, when the association booked a $3.4 million loss, its chief executive, James Henwood Jr. collected $900,000 in total compensation, The Times found through a review of IRS filings.
The year was not an anomaly and four other executives also received pay packages in excess of $300,000 each.
Experts told the newspaper that the association’s tax exempt status may be in jeopardy given the breadth of its business.
In a statement issued after the board’s vote, Solis said, “The audit will also review the fairgrounds’ operations to ensure that the public good remains its focus and mission.”
An audit report is expected back in four months. The task force is expected to report back in December or January.
The fairgrounds was already under scrutiny because of the drug overdose deaths of two teens at a summer concert held there.
A county task force is working on more safety recommendations for raves that draw underage drinkers and drugs. A ban on such events remains an option.
An event at the Pomona venue this weekend resulted in 310 arrests, but no fatalities.
Solis said those trying to come into the concert intoxicated or carrying drugs or drug paraphernalia were arrested, and the concert was limited to ticketholders at least 21 years old.
“The 21 age limit I think really curtailed, cut into their population … that had a significant impact,” Solis said.
— Wire reports