Fairs: allocation of revenues: gross receipts for sales and use tax.

Assembly Members Connolly and Hadwick frame a measure that reframes fair funding by tying allocations to labor standards while expanding the revenue pool available to fairs. The core change increases the share of prior-year gross receipts reported for sales and use tax purposes that must be directed to the Fair and Exposition Fund via the Governor’s Budget from 0.75% to 2%. The augmented amount is to be included in the next annual Governor’s Budget for the Department of Food and Agriculture to allocate to fairs, with transfers to the Fund scheduled promptly after enactment of the Budget Act. Administrative costs to administer the new framework are to be paid from the enhanced 2% allocation before any fair distributions.

The measure creates a new reporting pathway and annual accounting process. The tax administrator would add a reporting line or develop a separate form to capture the segregated gross receipts and the related sales price of the property when the sale occurs on or within fair grounds or on land leased to a fair. The administrator must deliver an annual report to the Department of Finance by November 1, detailing the total segregated gross receipts and noting identified errors and their estimated impact to enable an adjusted total for the following year. The annual funding flow is designed to move from the tax administrator to the Fair and Exposition Fund through the Budget Act, with a transfer deadline specified and funds thereafter continuously appropriated for allocation under existing statutory provisions.

Funding for allocations to fairs is conditioned on labor standards for nonmanagement employees connected to the fair or to real property owned or leased by the fair. The measure requires meal periods and premium wages for overtime and extended work hours, with specific thresholds for daily and weekly overtime and double-time pay, and it provides exemptions for full-time carnival ride operators employed by traveling carnivals. It also excludes from coverage those workers under a valid collective bargaining agreement if the agreement explicitly provides the listed protections, including wages, hours, meal periods with arbitration of disputes, and premium overtime rates at levels at least 30% above the state minimum wage. The labor-standards provisions connect funding eligibility to observable working conditions at fairs, while maintaining defined definitions of “fair” drawn from the broader statutory framework.

The bill preserves the Fair and Exposition Fund as a continuously appropriated resource, with allocations governed by the existing mechanism that directs funds to fairs. Implementation and oversight involve coordination among the tax, budget, and agriculture departments, and the measure leaves enforcement details to existing labor-law remedies rather than creating new sanctions within the statute itself. Questions that commonly arise concern how enforcement would operate in practice, how the broader allocation formula under the current framework would distribute funds among fairs, and how definitions of nonmanagement employees and CBAs interact with diverse staffing arrangements across fairs and leased properties.