A verbal and undocumented loan agreement between the Town of Princeton and the Princeton Motocross Club was dissolved Monday night by council.
The decision results in a write off of $8,379.
Motocross president Dan Lankinen made a delegation to council earlier this month, asking for forgiveness on a promise to repay the municipality for hauling dirt to the Princeton fairgrounds in order to create a motocross track.
An accompanying letter stated: “Two…local individuals were approached by a representative of the town in 2015 and asked if we would be interested in building a motocross track as a draw to bring people into town. We considered the proposal, which we knew would be a huge undertaking, and thought it would never go as there was an issue of no suitable dirt onsite.”
The municipality then secured a donation of dirt from Weyerhaeuser, and agreed to pay for hauling the dirt to the exhibition grounds provided the club eventually returned the cost of the delivery, he said.
“The idea was that over a two to three or five year period we would pay the town for the [moving] of the dirt. The town moved dirt from one point to another and we would do our best to pay it back,” Lankinen said in an interview with The Spotlight.
“I’m a man of my word and I had full faith that’s the way it would work out. We’ve been at it two years now and the income isn’t there to pay the town back.”
Lankinen told council that if the club made good on the loan, it would likely have to fold.
“The dirt is still the town’s either way.”
Princeton CAO Cheryl Martens, who took up her post in February of this year, said when Lankinen made his delegation she was unable to find any record of a financial agreement between the club and the municipality.
“I can’t really find much of anything on it,” she said. “It’s kind of vague…There was nothing set up so I don’t know how it all came about. Finance should have been involved.”
Martens located a 2015 payment from the municipality to Ted Coyne described as “gravel-truck-Weyerhaeuser-PXA-bike track” for $8,379.
“All I can really do is bring forward the information. I do know that we did have those invoices and they were actually recorded as material hauling.”
According to Martens the club’s debt should have been recorded as a receivable, with payments made by the club and applied.
“It was never carried over as something owning.”
Councillor Doug Pateman was a proponent of the motocross club and building of the track, however he told The Spotlight he was not involved in the financial side of the project.
“Once the financial aspect portion of the motocross, haulage, money et cetera was being discussed, I stepped back to allow senior staff members the opportunity to do their jobs and work out the logistics. I was only involved in the initial idea and early steps,” he said.
“Senior staff took over from there.”
Since 2015 the municipality has turned over three senior administrators – the CAO, chief financial officer and director of infrastructure.
Martens recommended to council that they dissolve the off-the-books loan agreement.
Her report stated: “There was no funds given to the club…The club does not own the motocross track. It was developed as an asset belonging to the town. If the club were to dissolve, another motocross club could potentially establish themselves and use the track and not bear any of the costs to construct it.”
According to Lankinen the track has already paid for itself many times over through the number of people it brings to the community.
Princeton Motocross holds two sanctioned events each season and each has approximately 110 racer families attending, he said.
About 30 families camp at the PXA and the balance pay for local accommodates.
“They eat in restaurants and buy gas and everything else.”
Lankinen estimated each race generates approximately $84,000 in local business.
Last year the club also remitted rider and camping fees to the Princeton Exhibition Association that totaled $4,155.
Princeton motocross maintains the track, and would like to spend its small annual profit on track improvements, he said.
“We have volunteered equipment and hundreds of hours of manpower time building the track.”
The club – which attracted 100 members in its first two years – also invites local riders once a week so they can improve their skills and have fun, he said.
“We are a grass roots club starting from nothing. If you go out there on a Tuesday night you will see a whole pile of little kids going around on bikes.”
Mayor Frank Armitage said it is appropriate to support the motocross track as it is a municipal asset.
“They are a town facility,” he said Monday night, likening the payment as an improvement to the fairgrounds not unlike a recent $75,000 roof replacement to one of the property’s arenas.
“As you have heard we have paid the bill. It’s looked after,” he said Monday night.
“It’s a town facility and it behooves us to keep it up to standard.”
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