Latest News 2011 August Assets and Liabilities Vary in Horse Racetrack Bankruptcy

Assets and Liabilities Vary in Horse Racetrack Bankruptcy

The Prescott Daily Courier, from Arizona, has reported that the financial documents in a bankruptcy case, involving Yavapai Downs horse racetrack and its associated facilities, widely vary depending on who was doing the math and when.

The filing lists $24 million in assets and $15.4 million in liabilities - though the actual value of the facilities have had fluctuations.

Farm and Ag Association Chair, Jeff Wasowicz, said that in 2009 the appraisal was listed at $22 million, after the racetrack allegedly received a federal loan.  That figure is also the amount that the former racetrack's owner, the Yavapai County Fair Association, said that that it paid in 2000-01 for building the Prescott Valley facilities.

In 2010 the Yavapai County Assessor's Office assessed the properties at $20 million.  In 2011 they dropped that estimated value to $5.4 million.   Allegedly, the Farm and Ag Association requested a different method be used to calculate the value in 2011 - and the new method resulted in the discrepancy.

The entire facilities in the filing include: 300 acres that are encircled by ranchland and Highway 89A, a four-story grandstand building, a one-mile long racetrack and stables for 1,190 horses.

The main creditor is the U.S. government.  The USDA Rural Development is owed $14.56 million in loans. Another million was added to the debt when Farm and Ag refinanced in 2009 - signing a $13.6 million loan.

No payments have been made by the association toward the loan since December 2008.

John Deere is the only other secured creditor - with an $8,617 equipment loan. 

According to the bankruptcy filing, $830,789 is left in unsecured claims.

Two allegedly unsecured claims are not included: $1.3 million to the town of Prescott Valley due for payback of infrastructure and $250,000 to the Yavapai County for an agreement - made ten years ago - when the track moved away from the county property in Prescott.

Wasowicz claims to not know any reason why these two claims are not in the bankruptcy filing.

A total of five government agencies are owed a collective $80,735 in unsecured claims and those over $200 are: Coconino County for $47,330, Yavapai County with $22,733 and the Internal Revenue Service for $10,671.

With debts as high as $70,344 are thirty-one racetracks, racing associations and country fair authorities.

Also in the filing is an alleged $26,036 that was due to be paid to the horsemen that won the Yavapai Downs last year.

A creditor's meeting is scheduled for August 24 in Phoenix and another will be held in Prescott on August 26.

After canceling this summer's racing meet because of the losses, the association gross income this year reduced to $55,088.  In 2010 the gross income was $8.17 million and in 2009 it was $6.9 million.

There are three remaining employees at the track until the end of September - then their fate will be in the hands of the bankruptcy trustee.

Facing a bankruptcy?  Get all of the help you need when you contact a bankruptcy attorney today to do your filing. 
Categories: Bankruptcy Basics