Trainer strolling horse in Truro

Officials with the Nova Scotia Provincial Exhibition Commission say operations will continue as normal for now. (CBC)

The provincial government has foreclosed on a loan of the Nova Scotia Provincial Exhibition Commission, taking possession of the indebted commission's property and assets which include the harness racing track near Truro.

Keith Colwell, the Minister of Agriculture, said Wednesday the Nova Scotia Farm Loan Board had called the loan. Colwell said the Nova Scotia Provincial Exhibition Commission owes $422,000, including more than $170,000 in arrears.

"It is a tough decision, but the right thing to do," Colwell said in a statement.

"The board must practice responsible lending, otherwise it wouldn't be able to support businesses in the agriculture industry. It has a responsibility to Nova Scotia taxpayers."

Colwell said by calling the loan, the Nova Scotia Farm Loan Board is ensuring the Provincial Exhibition Commission property can be appreciated at its full market value. He said it's time the facility starts making money instead of losing it.

"It's been a problem for years and years and years and we're going to try and get it resolved so it'll be a continuous opportunity for them to grow and to be financially feasable and accountable," he said.

Business as usual, says commission

Bruce Kennedy, the chair of the Nova Scotia Provincial Exhibition Commission, said operations will continue as normal for now.

"Hopefully everything will quickly get resolved and we'll get more information and more assurance that we are going to be here for the long term," he said.

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

He said the government recognizes the importance of the exhibition and its facilities to the Truro-Bible Hill community and will take measures to ensure operations and facilities are maintained in the interim.

"For those who use the exhibition's facilities, it will be business as usual for the time being," he said.

With files from The Canadian Press