October 30, 2009 in City

County boots raceway operator; debts remain

Commissioners say not all work OK’d

Jim Camden jimc@spokesman.com, (509) 459-5461

On the Web: Read past coverage at spokesman.com/tags/spokane-raceway-park.

Spokane County commissioners Thursday fired the company they hired less than a year ago to operate the county’s Raceway Park, their controversial purchase near Airway Heights that drew crowds this summer but racked up some $1.2 million in unpaid construction debt.

The county’s insurance may be needed to pay contractors that performed work ordered by Austin Motorsports Management but never approved by the county, commissioners said.

Commissioners voted unanimously during a special afternoon meeting Thursday to terminate the contract with the company and owner Bucky Austin, a racing enthusiast who owns a chain of auto repair shops in the Puget Sound region. Despite promises in August and September that he would make good on all outstanding debts for park improvements, Austin still owes money to several local contractors, who have filed liens worth about $1.2 million against him and the county.

The county is looking for a new operator to run the track in 2010, and commissioners expect to keep a “closer, watchful eye” on Austin’s replacement, Todd Mielke, chairman of the Spokane County Commission, said Thursday.

The county learned of financial problems at the track last summer, when contractors began serving notice that they would file liens for unpaid bills. Austin called the liens standard procedure and said he had to review billing to make sure the work was actually done. He promised to pay everybody by November.

But commissioners discovered Austin had ordered more construction than they expected, essentially compressing renovations the county thought would take two years into the first year the track operated. He did so without securing performance bonds, as required by state law, or seeking competitive bids on the projects, commissioners said.

Because of those problems, commissioners said Austin’s contract was in default.

Austin was put on notice in September that he’d lose the contract in 60 days if he didn’t “cure” those problems. He said he would find financing or partners to make payments. But his attorney confirmed this week that “Austin Motorsports Management is unable to find additional financing to continue to operate the raceway,” Jim Emacio, the county’s chief civil deputy prosecuting attorney, told commissioners.

The notice of default had a 60-day time limit, which would have been up Sunday. Commissioners said they terminated the contract three days early because the weather was turning cold and they wanted to have county staff “winterize” the facility as soon as possible.

Asked if the decision was at all prompted by fears Austin’s management company, a limited liability corporation that’s separate from his repair shops, could declare bankruptcy, Mielke would only say: “Rumors abound.”

The county will allow new potential operators to submit bids.

“We hope to find an operator that can continue to operate the track … and maintain its credibility with the community,” Mielke said. “We’re going to do our due diligence with any construction projects that take place.”

The county will also review all the outstanding claims to make sure the work was done, is up to standards and has not been double-billed, Commissioner Mark Richard said. Legitimate claims will be submitted to the county’s insurance carrier for payment.

That process could take up to 60 days. John Black, an attorney who represents seven of the contractors holding some $1.2 million in unpaid bills, said his clients could eventually file suit against the county if they aren’t paid. But it might take about two months to prepare a lawsuit, so the contractors might hold off.

“If in fact there is a commitment to pay, it would make sense to wait,” Black said.

Story
Comments 14

14 comments on this story so far. Add yours!

Shannon Sullivan on October 30 at 5:16 a.m.
I remember back when Milke/Richards had a “vision” for the raceway; Milke exact words were “I have hopes and dreams for the raceway.”

Well, my hopes and dreams include no new taxes to pay for his dreams.
I did everything imaginable; except run against them myself. There two (Milke/Richards) are bought and paid for.

Please Spokane, DO NOT ELECT FRENCH for county commissioner; there is NO telling what the 3 of them could do.

Bonnie; thank you, thank you!!! You called BS on this from the beginning.

I will be pounding the pavement for you!!! VOTE BONNIE!

And yes; I post under my own name, I am not ashamed of the truth.

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dick adams on October 30 at 6:35 a.m.
Lets hire Judy Collins to sing her infamous song, “BRING ON THE CLOWNS” when Richard and Mielke sit down for the county weekly meetings. Is it any wonder the county is wallowing in red ink? P. S. Thanks, Bonnie.

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Hikerboy on October 30 at 7:54 a.m.
For supposed conservative idealists, Mielke and Richards have done a fine job of getting Spokane County into the entertainment business by purchasing this track . Like so many federal programs, it will be left to the tax payers to pay for their poor decision-making. We need another Bonnie Mager!

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Lewis on October 30 at 8:51 a.m.
May be the sheriffs that are going to loose their jobs can be workers at our new race park.

Spokane,,,,,,,,it just gets deeper and deeper

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Lulubelle on October 30 at 9:04 a.m.
With the revelations regarding the lack of a performance bond (County contracting needs a spanking here!)…….I wonder if liability issues were addressed and insurance with the “additionally insured” clause in place before awarding Austin the contract. If not, could county taxpayers be liable for any lawsuits in the wake of that fatal accident at the track?

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Bruce Nickerson on October 30 at 11:14 a.m.
To Shannon Sullivan
You know what really bothers me. ? Are people like you who have never been to the race track, but still act like you have full knowledge of all the circumstances.

Remeber this qoute from Oct. 9th. (SPOKANE IS SO QUICK TO JUDGE).
Do you actually think Milke and Richards had the knowledge that Austin was going to grossly over extend himself and then not pay up.
Do you actually think with as much heat as they were taking they would have just turned a blind eye and hoped for the best.

I am so sick of all you arm chair politicians making comments after the fact, on blogs and letters to the editor I could scream.!
And as for your beloved Bonnie, how about I send you some pictures of her accepting a $30,000.00 check from the Spokane Pro Gas Assotion. From racing events held in the fall of 2008.
It's also funny I dont see you ranting and raving about the 1.2 million the county is going to sink into “Avista” Stadium
Bottom line is the county got a smokin deal on the land it purchased, and given any kind of a chance it will become evident.
Todd Milke and Mark Richard are not perfect, as no one is. But they do have vision and are'nt afraid to step up and make things happen.
You say your not ashamed of the truth, well maybe you should find out what the truth is first. And I dont mean all the half ass'd things you hear on the t.v.
You said you did everything imaginable. “EXCEPT” run against them. Well nows the time sister. Start campaigning now, so you can save us all.

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lyle on October 30 at 2:48 p.m.
Bruce you right on!!!! Bonnie can't see the future past the end of her nose, get her out of here!

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Rifleman__Dodd on October 31 at 12:59 a.m.
If I was Dr. Kim Thorburn I would be lauging my you know what off.

Yo Bruce.. One doesn't have to eat bacon to know that a pig smells bad.

If the race track cant stand on its own economic feet, then perhaps you could prop it up since the voters shouldn't.

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Spok on October 31 at 3:05 a.m.
@Bruce Nickerson

The $30,000 check that Spokand Pro Gas Association paid was presented to all 3 commissioners in October 2008, an amount that might have covered a month or two of interest on the money borrowed to buy the track.

Two different owners have crashed and burned trying to make that race track successful. They both were highly knowledgeable of the race track business and how to promote it, and yet they were unable to make it a success. Race track businesses are specialized and require different business skills than operating a park or golf course.

The county should never have bought such a highly specialized, active operation.

Mielke, Richard voted for it, as would have Salvatori, the announced candidate now running for commissioner. All three gentlemen were/are wrong.

Bonnie Mager knew that from the beginning and voted against the purchase. She looks out for us.

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Shannon Sullivan on October 31 at 8:43 a.m.
Bruce; 1st let me say that it is nice to a healthy debate. 2nd: thanks for remember the comment of mine in regards to the SPD.

Let me start off by addressing these issues: I have attended several races at the racetrack and have paid very close attention to the entire situation. A very good friend of mine; fathers was involved in putting together the raceway park when in first opened; he served on nearly every board in the county involved with anything in regards to the park. He and his son have been involved with racing here in the inland northwest for over 60 years. Last name “Gorder” ring a bell? If you know racing here, you know the name. So I am certainly not unaware of all aspects of what I am responding to.

Of course we all make mistakes; and I am CERTAIN that Milke/Richards did not want the raceway to fail, after all Richards’s exact words (via his comments to the Inlander in late July, early August addition 2008) Richards said had experience as a investment analyst, and would hedge his bets on belief and the passion that raceway was a sound investment.

The point here is that when you are playing with taxpayer’s money; it is best not to hedge your bet on anything other than facts. We the citizens will end up paying for this bet. I don’t know about you, but I really cannot afford it.

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eastwashcoll_55 on October 31 at 2:35 p.m.
let's see Richards and MIlike spend HOW MUCH money ?4 million…now 18 months later…we are cutting employees for county services and this racepark combination money pit has produced one unsettled lawsuit ( fill in figure start with 1 million and go up) and now 1.2 million is other expenses..so much for all the profit and income it was going to produce. Secondly why would anyone approve a 25 year contract with someone you have done NEVER done business with? MAybe five years with Austin was enough, reality shows one year was too much.
RIchards and Milke are the tweedledee and tweedledumber of SPokane COunty courthouse.

I have attended races at the park, loved the racing but they had serious safety issues regarding how close fans to could get to the starting line. Excessive speed by racers in pit area, and NO pit marshalls to be seen anywhere. They got lucky they didn't have other injuries and lawsuits.
As far as Bonnie Mager smiling and taking the check fromt he PROGAS folks..what was she supposed to do? turn it down?
They unlike the management firm, complied and completed the deal. But face it, 30-40 grand doesn't begin to fill in the financial hole this toxic money pit has begun to create.

You know, the big money track management who run profitable tracks..have them in areas that make money. Don't you think the pros, if they thought Spokane was a money maker, they'd be here. But they know SPokane is a loser, no big local sponsor money, no big crowds, and it's in the middle of nowhere so far removed the touring pros won't come unless gauranteed cash.

Now the county spends 1.2 million on Avista why? hey minor league baseball sells tickets..people actually buy them and watch the game. The Indians have led or near the top in attendance and other measurable marketable activity.

Keeping the racetrack as a county enterprise in ANY form is a
moronic idea. If it's such a good and profitable idea….where are the outside pros begging to run it, to make all that money?
Simple answer folks….it ain't good it ain't profitable, and there is no money.

We as a county can NO longer afford the financial wisdom
of Todd Milke and Mark RIchards. Bonnie MAger was the ONLY one who saw this train wreck coming. So..next election,
think about who was watching your MONEY your tax dollars,
and who was not….

I love drag racing…I also love major league baseball. I'm willing to go to Seattle to see both, rather than have my tax dollars save me..4 hrs of drive time.

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newspokanite on November 10 at 11:00 p.m.
THis is just one reason why governments should NOT be involved in commercial ventures regardless of the popularity of the racetrack. If Richards and Mielke were true Republicans then they would know that you should let the market determine the demand, not avid racers. The only possible way a racetrack or any venture can sustain itself is the bottom line, ie profit. Richards and Mielke took the wrong approach in moving on the sale of the property. They took testimony from the droves of racing enthusiast, that is the racers themselves, and believed, wrongly, that there was a demand. They failed to look to see if there was a demand from a spectators point of view. Who and how many people would pay to see Friday night racing or short track racing or mid-level drag racing. Apparently not many. If there was sufficient ticket sales for these type of events then Im almost certain the operator could have and would have paid his bills. There was definitely no shortage of racers thrilled to have a venue to race, but without spectators willing to pay to watch these events (and generate revenue) then the business model was doomed to fail. Its tantamount to any sports team who hires staff, coaches, players, and shiny helmets all ready and willing to play the game, yet when the doors open only a handful of people come to watch. There's now way the team will stay in business. Bottom line is…there is NO demand for a racetrack other than for the racers. People won't pay to watch amateurs.

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Rifleman__Dodd on November 10 at 11:25 p.m.
“If Richards and Mielke were true Republicans”..

Well I haven't seen a true republican since Reagan left the planet. He should have taken Bush 2.0 back to where he came from. I think it was the planet UR_ANUS.

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rll6888 on January 14 at 9:40 p.m.
I have been racing in the Pacific Northwest since 1981. Orville Moe (although a bit of a scoundral himself) managed to put on weekly racing venues at both the Dragstrip and Oval track at Spokane Raceway Park as it was known; on a regular basis.
For the most it gave the local racers a place to develope thier cars, skills, crews, and equipment toget good enought to compete very well at other tracks around the Northwest. zmind yo Moe did some underhanded things with taxes in Airway Heights as well as with the people he suckered into putting up money for shareswhen first developed the track.

Be that as it may there were many excitng events held there for many years and the fans came out enmasse and not only from the U.S, but from Canada as well.

My point is that during this period of prosperity; I did'nt hear one negetive comment from the County, Airway Heights residents or businesses and especiaslly not from the people who put up the money to have it built in the first place.

If you went to the Lilac City Funny Car festival,The Fox Hunt, and or the AHRA World Finals you would have seen packed houses for all those special events and plenty more for the regular weekend races.

That money was hoarded by Moe, the payouts for the winners stayed the same even as cars got faster and more technical. Very little if any went back into the track for inprovements, I aslo suppose that same amount or less went to the shareholders.

As a result the track fell into disrepair-not being to keep up with other local NW tracks which in turn caused the main core of Spokanes SERIOUS racers to either migrate away or get out altogether since testing at a substandard racetrack in order to compete in NHRA events was simply a waste of time and money.

So, with all that being said The County has a First Class Drag Racing facility that is now up to NHRA standards. By putting a competent management team in place that can offer venues to bring the racers back; the fans will then follow and it becomes a viable operation again.
Events like the Division 6 points race, Fox Hunt, Pro Mod events, Lilac city Funny Car; and even a couple of high dollar bracket races that draw from all over th NW, CA, and Canada.
and even invite NHRA Pro Stockers to test after the Western Swing would create revenue to make the track successful and not leave the burden on the Tax Payers.

I'm willing to devote my time to make these thihgs happen. I'm retired and live in Tacoma. All my friends I race with live in Spokane. So I'm volunteering to try to make these things happen.

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