Value and ownership lead recommendations from W.H. Lyon Fairgrounds task force

SIOUX FALLS — The first question that Minnehaha County should answer when it come to the future of the W.H. Lyon Fairgrounds is pretty clear: What's it worth?

That's the first of three recommendations from a task force created to the examine the future of the fairgrounds in western Sioux Falls. The task force's report was presented to the Minnehaha County Commission on Tuesday, May 16, after months of public input and study.

“The community is paying attention and they are wondering: Is it for sale? What is the value of the land? Can it be sold?” said Erik Nyberg, spokesperson for the task force.

The first recommendation from the 15-member group was to seek a determination of the property value and the cost of either improving the existing campus or looking at other potential sites for relocation.

That recommendation led to the second, which said the county should seek further clarification of the deed restrictions on the 180-acre site that was donated by philanthropist Winona Axtell Lyon more than 80 years ago.

Nyberg said that would help the county better understand the options they have for the grounds while still meeting the intent of the donation.

The third recommendation was to establish a joint county and city working group to brainstorm potential organizational and business models, funding avenues and public/private partnerships to transform the fairgrounds into a regional agriculture campus that provides a larger cultural and economic impact.

The commissioners heaped praise on the task force for their work, which included numerous meetings with architects, top fair officials from around the country and examining a market and economic analysis for the fairgrounds.

Commissioner Dean Karsky said he wouldn’t let the report “sit on the shelf and collect dust.”

He said he would push for what the task force recommended, including doing soil borings to find out what’s under the ground. Knife River, the company that owns the adjacent quartzite mining operation, had made an initial offer of $50 million for the land, pending testing.

Karsky also said he would support having “clear title to the property” to clear up the deed restrictions, one of which requires leases with the fair association to be renewed every five years.

He added that they need to deal with the deed restriction issues, but still honor the intent of the Lyon family who donated the property and still has an attachment to the grounds.

The task force in its report said the deed restrictions were “a major hindrance to the operation and development of the campus, noting that requiring contracts be limited to five years in length severely limits the potential to secure larger donations, funding opportunities and development.”

Nyberg told the commissioners that the task force recommends hiring outside counsel to look at the restrictions.

In other highlights of the report, Nyberg and co-spokesman for the task force Mike Jamison addressed funding options, the widespread wear and tear of the grounds and buildings and the desire by regional livestock groups to have events at an improved facility.

The task force said current funding is insufficient to remodel, repair, replace or enhance the campus despite the grounds being used 330 days a year with more than 500,000 attendees and an annual estimated economic impact of $35 million to the community.

To help with funding besides forming partnerships and seeking donations, there was a suggestion that a city sales tax be collected on the grounds. Currently, only a state sales tax is charged.

Nyberg called it a “lost opportunity” for revenue.

It was also noted that the $35 million economic impact and its tax revenue is not returned or invested in the fairgrounds.

Nyberg said as far as what the task force would like to see done at the fairgrounds is to have it meet the “standards of excellence the community and region have come to expect from the state’s largest population center.”

He used a quote from a task force member who said, “Everything we do in our community is generally best in class. Examples include the Sanford Sports Complex, our outstanding giving for United Way, how vibrant our (Chamber of Commerce) is and the Denny Sanford Premier Center... and on and on. We need to implement the same standards of excellence to this campus as we do elsewhere throughout our community.”

In keeping with the desire for a strong agricultural-based campus, Nyberg said another highlight of the study is that regional livestock shows have shown a strong desire to host their events on the grounds.

“They absolutely love our town,” he said. “They say our restaurants are awesome and that they can get here from anywhere, from the north, south, east or west due to the interstate system.”

However, the report said, “inadequate facilities at the fairgrounds are a major deterrent to securing such shows.”

The largest building, the Expo Center, is large enough for the shows but needs improvements, said the report.

There was one estimate that it may take up to $110 million to make needed improvements, but Karsky said he clearly can say the county doesn’t have the funds.

Board Chairwoman Jena Bender said simply the task for improving the fairgrounds is simply “a tough nut to crack.”

With a report in hand, the next steps remain to be seen.

The task force, though, said its vision is “to see a financially sustainable fairgrounds that can be seen as a regional attraction for entertainment, hospitality, commercial, retail and research development by using private and public partnerships to support agriculture events and a large-scale agricultural exposition.”