The Lethbridge and District Exhibition had forecast a deficit of roughly $6.4 million before new management structure put in place
Article content
The Lethbridge and District Exhibition’s finances have improved since the beginning of the year, but the organization that runs the southern Alberta city’s Agri-food Hub and Trade Centre still figures to run a multimillion-dollar deficit by the end of its fiscal year.
The 268,000-square-foot, $77-million facility, which sits on land owned by the City of Lethbridge, opened in August 2023 and features banquet salons, four meeting rooms and outdoor patio areas.
Advertisement 2
Article content
Within months of opening, the LDE requested a financial lifeline to keep the facility running. Former CEO Mike Warkentin said in December 2023 inflation, interest rates, supply chain issues and after-effects from the COVID-19 pandemic contributed to the exhibition’s financial situation.
The exhibition had projected a deficit of roughly $6.4 million for the current fiscal year before a new management structure, approved by the Alberta government in January, was put in place. The former board resigned and a new board of directors, which includes City of Lethbridge and Lethbridge County senior administrators, was appointed with the task of creating a viable business model and governance structure for the organization.
The LDE’s business model came under scrutiny in December, when the Alberta government — which contributed $27.8 million toward the Agri-food Hub and Trade Centre — cast doubts over it when declining to provide $1 million in emergency support to the organization.
In its latest financial update to Lethbridge council, the LDE now predicts its deficit to be $3.26 million for its current fiscal year, which ends Oct. 31.
Article content
Advertisement 3
Article content
“As a City Council, we know we have some important decisions ahead regarding the budget for LDE,” said Lethbridge Mayor Blaine Hyggen in a statement earlier this week. “But we are encouraged by the good work we’ve seen so far to reduce the deficit.”
The City of Lethbridge has contributed $6.1 million in funding to the exhibition, including $5 million in operating and capital grants for its current fiscal year, $300,000 for an independent third-party review of the LDE and the Agri-Food Hub and Trade Centre project, and $850,000 for city resourcing requirements.
During Tuesday’s council meeting, a councillor asked if the exhibition has received any rental inquiries at the older facilities — which include four old pavilions — to offset its costs.
Acting LDE CEO Kim Gallucci replied the Spirit Halloween is now renting space in one of the old pavilions, but their physical condition is a problem for the organization.
“We are proposing to maybe not renting them at all and winding down those old pavilions entirely,” said Galluci.
He added the organization would likely save more money by shutting them down than renting them and then having to fix any maintenance issues that could crop up.
Advertisement 4
Article content
During Tuesday’s discussion with council, Galluci assured Deputy Mayor Jeff Carlson that the new renter was not receiving a subsidized rental rate.
“We definitely weren’t their first choice. We’re probably down the line quite a bit, but in that case it wasn’t really competition,” said Galluci.
But running the exhibition, originally formed as the Lethbridge and District Agricultural Society in 1897, “isn’t just dollars and cents,” he said.
“It supports a lot of community events, it supports a lot of activities around agriculture.”
Events like its farmers’ market “aren’t really money generators” but rather “community initiatives that help bring people together, farm to table, that type of thing,” said the exhibition’s acting CEO.
In a news release, Galluci says the LDE team has booked 15 more events to the 2024 schedule, six new 2025 events, and the Alberta Fire Chiefs Conference in 2028.
“Our board just recently passed a motion that we would be focused on agriculture, convention and trade,” he told council Tuesday.
Attendance at the exhibition’s annual Whoop-Up Days event in August topped 40,000 people, and a new record number of people took in the pro rodeo, said the City of Lethbridge in a news release.
Article content