The board of directors for the event has resigned, the office premises has been boarded up and is up for let.

Former Board members were reluctant to talk openly about the fiesta's fate this week, and financial controllers were unable to be contacted for more details.

Rumours of the financial problems were confirmed last year, when former Treasurer Geoff Byron went public about the budget woes.

He confirmed at the time the fiesta was facing a $80,000 debt.

Among the problems with the event was the cost of insurance.

The associated festival attracted thousands of people, and up to fifty balloons would participate.

However, in recent years, the festival has been plagued by money issues,

particularly insurance problems.

Canowindra calls itself the 'balloon capital of Australia," though, and there are hopes that there will still be a hot air balloon festival this year.

A group of people are in the process of organising another, smaller, balloon festival to replace Marti's, to be held on the eighth and ninth of March.

Travel operators are concerned over the business liquidation. They have already taken bookings for event, and the fiesta regularly draws in crowds that make a big contribution to the day.

Marti's Canowindra Balloon Festival was set up by successful Canowindra man Frank Hackett-Jones in memorial of his mother Marti.