By STEVE BROWN
OLYMPIA -- Updated state legislation would allow nonprofit fair operators to rent out their properties the same way county fairs do without losing their property-tax exemption.
Under current law, nonprofit fair operators are exempt from paying property taxes if the land and buildings are used exclusively for fair purposes.
Heather Hansen, representing the Washington State Fairs Association, said, "Basically, the way it reads now is no one is eligible for the tax exemption. The current exemption is lost if nonprofits rent out any part of the grounds. County fairgrounds don't lose their exemption."
Sen. Doug Ericksen, R-Ferndale, told the Senate Committee on Agriculture, Water and Rural Economic Development that Senate Bill 5078 would delete the restrictions except for nonprofit fair operations with property valued at more than $50 million.
Jim Baron, manager of the Northwest Washington Fair in Lynden, said his fair was county-owned until "the county wanted out of the fair business." Now it is operated by a nonprofit fair association, which is in part supported by leasing out its buildings to the community for storage and for large gatherings.
"If we were to be put into a position to pay property tax today, it would very devastating to our organization," Baron said. "We would not be able to absorb that."
Hansen said that as counties cut back on funding, "often the fairgrounds is one of the things they choose not to fund."
She told the legislators that the exempting legislation would not take anything away from the communities because the property has never been on the tax rolls.
"There are only a half-dozen privately owned fairgrounds in the state," she said, "but for the few that need it, it's a big deal."
The biggest fair in the Pacific Northwest, the Puyallup Fair and Events Center, is a 169-acre facility that draws 18 million people to about 160 events a year. It is a nonprofit organization with a budget of $23 million-plus a year. About 87 percent of that budget is from admissions; most of the rest comes from rental fees.
Kent Hojem, CEO, said the fair pays about $1.1 million in property taxes each year.
"The way the bill is currently written, it would not affect us," he said.
Co-sponsors with Ericksen on SB5078 are Sens. John Smith, R-Colville; Brian Hatfield, D-Raymond; Michael Baumgartner, R-Spokane; Maralyn Chase, R-Shoreline; and Paull Shin, D-Edmonds.