Panel OKs tax breaks for Knoxville auto racing

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DES MOINES, Iowa (AP) - A plan to offer a state tax break of up to $2 million to the Knoxville Raceway moved forward in the Iowa House Wednesday.

The proposal received preliminary approval in a House subcommittee and will now move on to committee-level review. Under the proposal, the racetrack in Knoxville would get a rebate of state sales taxes to help pay for an expansion. It follows a similar perk lawmakers approved last year for the Iowa Speedway at Newtown, which may be amended during this session.

Knoxville Raceway officials said the rebate would help them build luxury suites for spectators and make other improvements. They expect to break ground by the end of 2016.

“Currently in today’s marketplace you have to keep offering additional amenities,” said raceway General Manager Brian Stickel. “We think this is a good project. It’s a huge project for us.”

The legislation would provide up to $2 million or 25 percent of the project costs, whichever is less. Lawmakers said the rebate would be an economic development boost for south-central Iowa.

“If ever there was a situation where if you build it they will come, this is one,” said Rep. Scott Ourth, D-Ackworth.

The dirt track about 30 miles southwest of Des Moines has been holding racing events since 1954 and bills itself as the “Sprint Car Capital of the World.” The stadium seats about 25,000 people and draws more than 200,000 visitors each year.

Iowa lawmakers are also considering amending a tax break provided last year to the Iowa Speedway at Newtown. That venue, which opened in 2006, was bought by NASCAR last year.

Previously that tax break was contingent on 25 percent of the Speedway ownership being from Iowa. The bill up for consideration in the state Senate would remove that requirement and would extend the rebate through 2026. That bill has received subcommittee approval in the Senate and next will next be reviewed by the tax-writing Ways and Means Committee.

Sen. William Dotzler, D-Waterloo, said it was important to continue the rebate so that improvements could be made to the stadium. He said the speedway was a benefit to the surrounding area. With temporary seating, it has held up to 60,000 fans for NASCAR Nationwide events.

“If the state doesn’t participate doing the upgrades, it’s going to hinder the development of the track,” Dotzler said. “There’s tremendous economic benefit to the communities around it.”

The original legislation provided a rebate of up to $12.5 million. About $9 million of that tax break is still available, Dotzler said.

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