YOUNGSTOWN Candidate delinquent on taxes, state says

The candidate's campaign says the issue is a huge misunderstanding.
By DAVID SKOLNICK
VINDICATOR POLITICS WRITER
YOUNGSTOWN -- The state says state Rep. Charles Blasdel, a Republican in the 6th Congressional District race, owes $20,986.23 or $54,915.87 in estimated delinquent taxes and fees on two defunct businesses he co-owned.
The issue is a huge misunderstanding, and will be cleared up, said Jessica Towhey, Blasdel's campaign spokeswoman.
The state attorney general's office on behalf of the Ohio Department of Taxation filed 13 tax judgments between Nov. 24, 1995, and Aug. 8, 2001, totaling $20,986.23 against Blasdel Cline Inc. and Executive Cigar Inc., according to records at Columbiana County Common Pleas Court.
The state never took the matter any further than filing the judgments, records show.
Blasdel, of East Liverpool, considered the leading GOP candidate in the 6th District, was a partner in both businesses. He was never notified of the tax judgments by anyone at the state or court, Towhey said.
The attorney general's office told The Vindicator on Friday that the figure is considerably higher.
What companies owe
Based on its records, Mark Anthony, an AG spokesman said the two companies owe $54,915.87 in estimated delinquent taxes and fees as of Friday.
Of that amount, $52,219.02 was for unpaid sales tax and delinquent fees by Executive Cigar between 1997 and 1999, Anthony said.
"Those are estimates that include a time when the store was not in business," Towhey said. "The best year of gross sales was almost equal to the amount they say he owes. We're going to find out the real number, if a number exists."
The cigar store was incorporated in late 1996 and closed toward the end of the '90s, but the company wasn't dissolved until 2002.
Among the 13 judgments filed by the state at the courthouse is two totaling $16,164.94 for "other tobacco tax" against Executive Cigar. Anthony said he has no record of the company owing "other tobacco taxes."
Businesses selling tobacco products, not including cigarettes, must pay the state a 17-percent fee on the wholesale price of the product, said Gary Gudmundson, spokesman for the Ohio Department of Taxation.
Two of the court judgments are for failure to pay corporate franchise taxes -- a tax on net income or the net worth of a business -- by Blasdel Cline, a Calcutta investment advisory company that operated between Jan. 25, 1990, and Dec. 30, 1994.
The two judgments, totaling $2,780.62, were filed by the state Nov. 24, 1995, in court for the company's failure to pay corporate franchise taxes in 1991 and 1992.
Anthony said the figure given to his office by the department of taxation for Blasdel Cline on Feb. 9, 1993, was $2,410.82. With fees and penalties, that figure is now $3,696.85, he said.
Notification
If a business shuts down, it must notify the state that it no longer exists, Gudmundson said. If it doesn't, the state expects the company to pay taxes, he said.
"A potential scenario is we have someone who had a history of filing and drops out of the system without properly notifying us. We assume they're still active," he said. "Those people have a responsibility to let us know they are no longer in business."
If a tax bill is ignored by a company, the taxation department sends a letter about six weeks later to the company's address asking for the money, said Pete Angus, counsel in the department's compliance division.
The department will ask staff in its regional offices to find a correct address or telephone number for the owners of the businesses, he said.
If that fails, the matter is turned over to the attorney general's office for collection through the court system, Angus said.
Past mistake
If this turns out to be a mistake, it wouldn't be the first time for Blasdel.
The Committee for Blasdel, the Republican's state House campaign committee, had a problem with Ohio Department of Job and Family Services.
In a Sept. 5, 2003, letter to Blasdel's campaign, the department acknowledged it incorrectly created a second account for the committee. The department removed a lien it had on the committee to collect unemployment insurance on that second account.
This new tax issue comes on the heels of the disclosure that Blasdel bounced a $542.68 check for property taxes. The check to the Columbiana County treasurer's office was returned to Blasdel for insufficient funds Tuesday for nine largely undeveloped properties near his Harvard Avenue home in East Liverpool.
Blasdel paid the fee Wednesday when he learned the check bounced.
skolnick@vindy.com