1. In all counties of this state in which the constitutional limit is not levied for county purposes, the county commission, upon the filing of a petition signed by not less than three hundred resident taxpayers and qualified electors of the county, shall call an election to submit to the qualified voters thereof, a special levy of not more than two mills on the dollar valuation, which levy, together with all other levies for county purposes, shall not exceed the constitutional limit of levy for the county affected, for the purpose of encouraging, promoting and improving the livestock, poultry, agricultural, horticultural, mechanical fabrics and fine arts, products and articles of domestic industry, and the exhibition of such stock, poultry articles and commodities, at the district or county fair held in the county.

2. If a majority of the voters voting at said election shall be in favor of the proposition, then the county commission at its next regular term thereafter shall make the levy, one-half of which levy shall be set aside by the county commission and distributed ratably to the exhibitors of the public fairs held in the county, for the purpose of paying premiums to exhibitors or the articles and commodities in sections 262.500 to 262.540. The other one-half of which levy, in the judgment and discretion of the county commission, may be used for the purpose of purchasing grounds or erecting suitable building for such fair purposes; but if grounds for the purposes are owned by the county, or leased or otherwise secured or obtained for such uses, then the other one-half of the funds may be used by the county commission in erecting such building. If it is the discretion and judgment of the commission that the other one-half of the levy be not used for grounds or buildings, then the whole of the levy may be used for paying such premiums. If the petition for the election asks that one-half of the levy be devoted to acquiring of lands or erecting of buildings, then the proposition submitted shall contain provisions for such devotion; and if the majority favor the proposition, then the commission shall so expend and use the proceeds of the one-half of the levy.

3. The surplus remaining out of the proceeds of any levy made under sections 262.500 to 262.540, in any year, in the hands of the county treasurer shall constitute a fund for the purposes of sections 262.500 to 262.540, and may be used either as premiums offered or advertising for exhibits to be made under any provision of sections 262.500 to 262.540.