ANCHORAGE (AP) -- The state Alcoholic Beverage Control Board rejected renewal of the Southeast Alaska State Fair beer and wine license Wednesday after fair officials could not demonstrate that half of their restaurant's sales were for food.
The Haines fair operates a seasonal restaurant, the Klondike Saloon, from May through September on the fairgrounds. Profits subsidize maintenance on fair buildings and pay for putting on the fair, which has drawn 8,000 to 10,000 people the last several years for its five-day run in August, said Anne Marie Palmieri, fair board chairwoman.
ABC Board executive director Doug Griffin said under provisions of the license, liquor sold is to complement food. Without sufficient food sales, the establishment was operating as a tavern, a liquor license category not recognized in Alaska, Griffin said. By law board members were required to reject a license holder that did not meet the requirement.
''The statute gave them little choice,'' Griffin said.
Fair officials hoped to renew the license but expected an unsuccessful outcome.
''They told us pretty much up front they didn't have much wiggle room,'' Palmieri said.
She said the restaurant probably did not meet the requirement, and a lack of accurate accounting at the Tex-Mex cuisine restaurant could not verify what had been sold.
''It is my belief that our employees did not code the alcohol versus the food sales correctly,'' she said.
Griffin said the license also came to the attention of the board because of complaints from Haines police.
''We issued seven notices of violations for other problems in their operation,'' Griffin said, including minors on the premises past hours allowed by Haines ordinance and a complaint of a drunk bartender.
Since the incidents, Palmieri said the entire staff has turned over and the board formulated a policy to make sure more violations did not occur.
The restaurant has operated since 1993 in buildings constructed for the filming of ''White Fang.'' Besides earning money, Palmieri said the restaurant is important for attracting people to other businesses that operate on the fairgrounds' 48 acres, including the Haines Brewing Co. and various shops.
''We all kind of complemented each other with the restaurant being there,'' she said.
Griffin said the fair can reapply for the license, but it will have to compete against others interested in a seasonal beer and wine license.
The fair also can apply for a nontransferable public convenience license, which requires a resolution of support from municipal government and a petition signed by 50 percent of the adults 21 and over who live within one mile.
Collecting enough signatures would be a challenge, Palmieri said. She estimates that half of Haines live within a mile of the restaurant.
Palmieri said the board will meet Sunday to decide a course of action.
Income from the restaurant was ''substantial,'' Palmieri said.
Palmieri said the fair could survive without income from alcohol sales.
''We have before and we will,'' she said, but it may mean more fund-raising.
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