Tens of millions in the hole and with a possible foreclosure looming, the bankrupt State Fair of Virginia last week received a show of solidarity from its host county.
The Caroline County Board of Supervisors sent a letter to the State Fair of Virginia Inc., the nonprofit that operates the fair, proclaiming its support for the organization, which is working through Chapter 11 bankruptcy reorganization after it ran afoul of borrowing agreements from its lenders.
The letter also shows that should the fair’s 360-acre home fall into foreclosure, which its largest lender has made clear is a possible outcome, the county likely won’t take kindly to anyone other than the fair using the property — no matter the purpose.
“Potential use of the Meadow Events Park property for any other purpose is not acceptable to the County,” the letter said.
The letter, signed by County Board of Supervisors Chairman Wayne Acors, said the land was zoned only for an entertainment venue consistent with the state fair.
“The County views the historic birthplace of Secretariat as a single-use property and not one that should be subdivided for residential or commercial purposes,” the letter says.
The property also has strict utilities and other agreements that would become costly roadblocks for any party that tried to use land for other purposes.
For example, Caroline County does not provide water and sewage to the land. Hanover County agreed to provide those services when the fair took over the land.
Should ArborOne, the fair’s largest lender, seek to reclaim the property through foreclosure, that agreement goes out the window.
“The agreement for utilities with Hanover County applies only to Fair and does not intend to seek another utility agreement under any foreseeable circumstances,” the letter states.
Asked about the motivation behind the letter when reached by phone Tuesday, Acors said that bringing the fair to Caroline County meant a lot to the community and that it has been a good source of revenue.
“The fact is, the county rezoned the land for the State Fair, and there is no intention of anything else,” Acors said.
Acors said the bankruptcy filing caught him and his fellow county supervisors off guard.
“I certainly was surprised at the bankruptcy and the amount of debt that was there,” he said. “I don’t know that it occurred to any of us on the board.”
“Certainly, we trust that the state fair is going to be able to work things out.”
Curry Roberts, chief executive of the fair, said the organization appreciates the county’s support.
“We have a good working relationship with Caroline County,” Roberts said.
As to whether the letter might discourage the fair’s lenders from considering foreclosure, Roberts replied, “I’ll let the letter speak for itself.”
The SFVA filed for Chapter 11 bankruptcy protection Dec. 1 after it got caught in a web of complicated, high-dollar financial dealings that left it unable meet some of its debt obligations.
The biggest blow to the organization came after its large investment portfolio lost half its value as a result of the recession and related financial crisis.
That portfolio was used as collateral to obtain more than $80 million in debt to develop the new fairgrounds in Caroline County. The income from the portfolio was also the main source of cash that was to be used to pay SFVA’s lenders.
ArborOne, a South Carolina lender on tens of millions of dollars of bonds owed by the fair, last month asked the federal bankruptcy court to let it keep its right to take action on the property, which could include foreclosure.
ArborOne argued in its motion that it doesn’t see how reorganization is possible and wants to make sure its interests are covered.
Christy Myatt, an attorney with Greensboro, N.C.-based Nexsen Pruet, the law firm representing ArborOne, would not comment on the case.
In closing in its letter, the county’s supervisors made sure the fair, and whoever else might read it, knows which side it’s on:
“Caroline County intends to take the steps necessary to ensure that the State Fair of Virginia Inc. will continue to utilize the Meadow Farm site for many years to come.”
Tens of millions in the hole and with a possible foreclosure looming, the bankrupt State Fair of Virginia last week received a show of solidarity from its host county.
The Caroline County Board of Supervisors sent a letter to the State Fair of Virginia Inc., the nonprofit that operates the fair, proclaiming its support for the organization, which is working through Chapter 11 bankruptcy reorganization after it ran afoul of borrowing agreements from its lenders.
The letter also shows that should the fair’s 360-acre home fall into foreclosure, which its largest lender has made clear is a possible outcome, the county likely won’t take kindly to anyone other than the fair using the property — no matter the purpose.
“Potential use of the Meadow Events Park property for any other purpose is not acceptable to the County,” the letter said.
The letter, signed by County Board of Supervisors Chairman Wayne Acors, said the land was zoned only for an entertainment venue consistent with the state fair.
“The County views the historic birthplace of Secretariat as a single-use property and not one that should be subdivided for residential or commercial purposes,” the letter says.
The property also has strict utilities and other agreements that would become costly roadblocks for any party that tried to use land for other purposes.
For example, Caroline County does not provide water and sewage to the land. Hanover County agreed to provide those services when the fair took over the land.
Should ArborOne, the fair’s largest lender, seek to reclaim the property through foreclosure, that agreement goes out the window.
“The agreement for utilities with Hanover County applies only to Fair and does not intend to seek another utility agreement under any foreseeable circumstances,” the letter states.
Asked about the motivation behind the letter when reached by phone Tuesday, Acors said that bringing the fair to Caroline County meant a lot to the community and that it has been a good source of revenue.
“The fact is, the county rezoned the land for the State Fair, and there is no intention of anything else,” Acors said.
Acors said the bankruptcy filing caught him and his fellow county supervisors off guard.
“I certainly was surprised at the bankruptcy and the amount of debt that was there,” he said. “I don’t know that it occurred to any of us on the board.”
“Certainly, we trust that the state fair is going to be able to work things out.”
Curry Roberts, chief executive of the fair, said the organization appreciates the county’s support.
“We have a good working relationship with Caroline County,” Roberts said.
As to whether the letter might discourage the fair’s lenders from considering foreclosure, Roberts replied, “I’ll let the letter speak for itself.”
The SFVA filed for Chapter 11 bankruptcy protection Dec. 1 after it got caught in a web of complicated, high-dollar financial dealings that left it unable meet some of its debt obligations.
The biggest blow to the organization came after its large investment portfolio lost half its value as a result of the recession and related financial crisis.
That portfolio was used as collateral to obtain more than $80 million in debt to develop the new fairgrounds in Caroline County. The income from the portfolio was also the main source of cash that was to be used to pay SFVA’s lenders.
ArborOne, a South Carolina lender on tens of millions of dollars of bonds owed by the fair, last month asked the federal bankruptcy court to let it keep its right to take action on the property, which could include foreclosure.
ArborOne argued in its motion that it doesn’t see how reorganization is possible and wants to make sure its interests are covered.
Christy Myatt, an attorney with Greensboro, N.C.-based Nexsen Pruet, the law firm representing ArborOne, would not comment on the case.
In closing in its letter, the county’s supervisors made sure the fair, and whoever else might read it, knows which side it’s on:
“Caroline County intends to take the steps necessary to ensure that the State Fair of Virginia Inc. will continue to utilize the Meadow Farm site for many years to come.”
What a mess!
This is a real shame. I love this property, but the fair itself needs work. I have said it before and I will say it again. The state fair of Va is not all it could be. They don’t do nearly enough to promote the great things Va has to offer. There are not enough Va products available. The fair should be a showcase of Va. Oysters, hams, peanuts, Va wine, bbq, craft beers, apples, booths promoting tourism and resorts of Va, battle fields, natural wonders, and anything else we happen to be known for. If people get a chance… Read more »
So the county steps in to diminish the collateral…. wonder how they would feel if they had to sell it at tax auction. Seems like an abuse of power to me.