Imagine a carnival game — let’s call it fill the bucket — where the object is to fill each bucket with colored balls until it tips and dumps out. There are six buckets, and they are not all equal in size. When the last bucket dumps, a massive gold star lights up, a Happy plushie pops out and “Don’t Worry, Be Happy” plays to announce the winner.
These buckets are sized to represent what is a fair amount of fiscal benefit from the Eastern Idaho State Fair. For businesses, this means a baseline of typical revenues plus a modest increase to be expected if their population base doubled for nine days. For government entities that rely on property taxes for their revenue — not sales tax — the size of the bucket reflects what is needed to cover the costs of having 250,000-plus visitors.
The six buckets are: seasonal wages for fair employees, hotels and other local businesses benefits, pop-up business opportunities for locals, the city of Blackfoot and Bingham County, Idaho state, and the EISF. Yes, the fair has a bucket. It is a for-profit business and needs to meet its expenses and generate a fair profit. In fact, its bucket has no bottom; it will tip over once all the other buckets are filled.
At that point, the fair is being fair, in my humble opinion, and deserves Happy singing “Don’t Worry.” It will have benefitted the citizens who work seasonally for it, brought increased profits to the local businesses, brought new business opportunities, such as parking, covered the extra expenses for Blackfoot and Bingham County, and forwarded the collected sales taxes to the state. Like any business, once the fair has covered its expenses, it can fairly take its profit revenue.
EISF was recently assessed as to its “estimated economic and fiscal impact” by Johnson Consulting, a group that specializes in helping governments and nonprofits assess their finances. According to the EISF press release, the study was based on data from the Bureau of Economic Analysis RIMS II model, which they used to compare the fair with similar-sized events in the Rocky Mountain area.
How does a private corporation fit in its customer base? Perhaps because it is partly financed by contributions from the 16 counties of Southeast Idaho? Maybe. For this game, we will concede that the study is valid.
Based on the study, the total local economic impact is $74.3 million during the nine days of the fair. That means there are 74.3 million balls in this hypothetical game. Let’s see how the buckets are getting filled with that many flying balls.
A direct benefit of the fair is the 600 jobs generated — that employee bucket will tip at 25 million. Pop-up parking is another bucket. I’m just going to estimate the revenue earned by local home and business owners that provide parking. Being generous, let’s assume there are 50 such parking “lots” that have an average of 10 cars each day paying $10 a piece. That equals 5,000 balls for that bucket. As to other businesses, that is beyond my experience to estimate. I’ll have to use the hotel revenue estimate from the study — $8,000 — with the understanding that many local businesses’ business falls off so much during these nine days that many close and consider it their fall holiday week.
Before going on to the government buckets, let’s tally the economic benefits so far: 25 million employee wages; $5,000 for parking; $8,000 for businesses = $25,013,000 or a bit more than one third of the fair’s total impact. We can probably assume that these three buckets will fill and tip out.
But what about the other three buckets? State taxes are straightforward — 2.2 million generated by purchases made within the fair. Does this also account for any income taxes paid to the state? Regardless, that is a clearly defined bucket to fill and tip since the state doesn’t have any costs to cover due to the fair — unless there are delay costs when highway work is suspended, or extra state patrol officers are brought in. Hmmm, for this game, let’s allow that the state bucket can tip at 2.2 million.
And on the surface it sounds like that should cover the local costs of the fair. But that is a state bucket, and very little of that comes back to the city or county. Here is where the game takes on more of a challenge.
The city of Blackfoot and Bingham County have estimated that their extra costs during fair week are, being conservative, around $75,000. To tip this bucket, the fair needs to put in 75,000 balls. They put in 15,000 balls.
When asked to cover the costs for extra law enforcement, emergency services, fire department watch, court and legal costs for those arrested and street clean up, they have pointed to their overall benefits and said that covers these expenses. But those fiscal benefits go in different buckets, leaving the city and county bucket nearly empty. How do citizen wages or profits directly fill the city or county buckets?
The money may be flowing out from the fair, but not to the city or county — not enough to be fair, tip that last bucket.
Yes, there are intangible benefits too, but do they pay the city and county bills?
It is good news that the fair is profitable and that there are fiscal benefits to many in the area. However, to be fair and win the fill the bucket accountability game, they need to put at least another 50,000 balls in the local government bucket before honestly claiming all the rest of the fair’s fiscal benefits. How about it? Want to earn the gold star and Happy locally spreading “Don’t Worry, Be Happy” vibes in Blackfoot as well as the state?