02/05/2014 02:29 EST | Updated 04/07/2014 05:59 EDT

Nova Scotia government calls loan, takes Provincial Exhibition commission assets

HALIFAX - The Nova Scotia government has foreclosed on a loan and taken over the assets of the indebted commission that runs the Provincial Exhibition and a harness racing track.

Agriculture Minister Keith Colwell said Wednesday that the Nova Scotia Farm Loan Board has called the loan of the Nova Scotia Provincial Exhibition Commission in Truro.

Colwell said the commission has a combined loan balance of nearly $422,000, including arrears of more than $170,000.

"We're just making this move to protect the province's investment both in our loans so we can use that money again to make further investments in agriculture," Colwell said. "Also, we want to protect our investment in the facility itself."

The Department of Agriculture is hiring an accounting firm to audit the commission after numerous unsuccessful attempts by the board to get financial information from the commission.

The non-profit group owns and operates a 26-hectare exhibition facility in Bible Hill where the annual five-day Provincial Exhibition has been held since 1946. The August event typically attracts about 40,000 people.

The exhibition grounds are also home to the Truro Raceway, a harness racing track that was threatened with closure last year.

Colwell said the timing of the audit wasn't clear, but that it wouldn't be rushed.

"We're going to take time to get our audit finished and find out what we have to do to make the operation profitable," he said. "It's a very important asset to the province."

Colwell said the troubled organization hasn't made any loan payments and has refused to hand over financial data despite repeated requests over 18 months.

The commission's board of directors recently resigned and a new board has been appointed.

Bruce Kennedy, the new board chairman, has said the commission also owes suppliers about $350,000. He said the biggest bill is for fees owed to other harness racing tracks that provide video feeds for their races.

Colwell said he wants to make sure the suppliers get paid.