County will not pay fair’s back taxes

It appears the county will not pay $16,854 in back taxes owed by the county’s fair board to the state of Minnesota.

Jack Edmonds, chair of the Mille Lacs County Board and also a member of the fair board for six years, brought up the idea at the board’s July 17 meeting, saying that amount was not in the fair board’s budget.

But commissioners, at a budget work session following their meeting last week, decided not to put the item on a future agenda.

And that means the fair board will have to find a way to pay the bill on its own.

The problem arose when the state made a ruling that the fair board had to pay sales tax on revenue at its back gate, where drivers enter to compete at Princeton Speedway, a track run by the fair board.

Edmonds told fellow commissioners in July that the fair board could not get an answer from the state about whether or not that tax had to be paid.

Then the state ruled two years ago that the fair board had to pay such taxes and the fair board has been paying that tax since.

The state audited the fair board’s books and went back two and a half years (not the seven it could have, Edmonds said) and determined that $16,765 was owed, a figure that has grown to $16,854 because of interest.

Edmonds talked with County Administrator Roxy Traxler and found out that it was legal to have the county pay the bill. Edmonds said in July at a County Board meeting that he hoped to have it on a County Board agenda in August.

That led to last week’s discussion at the work session, at which no decisions can be made, and that led to Traxler asking at the end of the discussion if commissioners wanted it on an agenda.

During the discussion, Traxler produced fair board balance sheets for 2010 and 2011.

Answering a question, Edmonds said there was a two-year plan with the state to pay $708 monthly over 24 months to pay off the bill.

Commissioner Dan Whitcomb said he saw sufficient revenue by the fair board to pay the amount owed.

Commissioner Phil Peterson said he didn’t want the county to front the money for the fair board.

Commissioner Roger Tellinghuisen disagreed.

“We should try to keep the fair,” he said. “We should help. I think we owe them a one-time help.”

Whitcomb disagreed, saying the fair board should restructure its organization, take out a loan, and pay it off.

Tellinghuisen said he thought the county, which makes a payment annually to the fair board, could make that payment now for next year, thus helping pay off the amount owed in taxes.

Other commissioners disagreed, one saying that would just delay the problem.

Edmonds said Monday in an interview that he was disappointed but that it was worth a try.

He said it was an unbudgeted item and assistance would have been appreciated.

Edmonds also said other fairs and tracks have been hit with the same problem.