After decades of neglect and broken promises, Dallas City Council’s decision to privatize Fair Park signaled a bright spot in South Dallas. After the nonprofit Fair Park First took over oversight of the fairgrounds and put in a lot of effort to raise funds to build a new park and convince skeptical neighbors, things started to look up.
News of turmoil in Fair Park First’s leadership and tensions between the nonprofit and Oak View Group, the hospitality contractor that manages the fair grounds’ day-to-day operations, provide further reason to worry. Questions are swirling about possible misuse of donations, and Fair Park First risks destroying the hard-earned trust it has built if it doesn’t prioritize transparency over other concerns.
Cracks in the relationship between Fair Park First and Oak View Group began appearing in April. Fair Park First CEO Brian Lualen said Oak View Group may have used restricted donations to pay for park operating costs. Restricted donations are often reserved for capital projects. Oak View Group has denied any wrongdoing.
Luallen was fired shortly thereafter, then placed on paid administrative leave and reinstated this month, but the news was followed by the resignations of Fair Park First board chairman Darren James and another board member.
The nonprofit declined to provide details about Lualen, citing personnel matters, but it is required to answer publicly about whether funds meant for Fair Park capital projects are being used for operations.
The money moves here are complicated, but important. Dallas voters approved a $50 million bond fund for Fair Park capital improvements in 2017. When the City Council voted to privatize Fair Park the following year, it agreed to provide $34.6 million over 10 years for day-to-day operations. Hospitality contractor Spectra, later bought by Oak View Group, promised to bring in millions of dollars in additional revenue through events. Since then, Dallas residents have voted to invest $300 million in hotel taxes into Fair Park infrastructure. And with private philanthropy, Fair Park First has raised $48 million for renovations.
Did the restricted donations stay within the scope of planned capital projects? If not, were they used for day-to-day operations? If so, what happened to the public funds that were meant to cover operating expenses? What happened to the promised revenues from events?
The nonprofit has ordered an independent audit of its donor management for fiscal years 2022 and 2023. Fair Park First’s new board chair, former Dallas City Councilwoman Beretta Forsyth Lill, said in a statement that the audit will examine donor limits, invoices and expense reports. Oak View Group has submitted a schedule of paid invoices that the group believes “should be applied to the donation,” she said.
The agency announced the audit in early April, but where is the audit? Forsyth-Rill said the audit won’t be completed until August.
“The slow response is due in large part to the complexity of the financial statements, which contain a variety of revenue and expenditure sources,” Forsyth-Rill wrote. “Aligning expenditures to specific projects has proven slower than expected.”
The committee also expanded the scope of its audit to include recent donations through April. Forsyth-Rill said Fair Park First plans to release its findings once the audit is complete and will “take care to ensure the anonymity of donors.”
Forsyth-Rill said she plans to appoint an audit chair to the Fair Park First board, adding that at its meeting Tuesday, the board adopted a policy outlining procedures and controls to ensure proper stewardship of funds, with or without restrictions.
“At that same board meeting, we adopted rule changes establishing an Executive Committee to expand review of policies, programs and financial oversight by a broader membership of the board,” she wrote. “Previously, many of the board’s decisions were made by the chairman/president.”
Forsyth-Rill highlighted that there are several projects underway at Fair Park, including the restoration of Leonhart Lagoon and the development of a community park that is in the final stages of design.
Judgment on whether funds were mismanaged must be reserved until the audit results are released. But the city and its partners cannot shy away from publicly explaining any missteps and how they will be corrected. Residents need evidence that things are not business as usual in South Dallas.
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