State tells 2,500 local firms to halt

8/15/2007

Opened at the start of the Cold War in 1945, the Bomb Shelter quenched the thirst of customers in downtown Toledo for the next half century.

But seven years after the business closed to make way for Fifth Third Field, the state of Ohio is just getting around to canceling its charter.

It is among a backlog of more than 50,000 closed or tax-delinquent businesses - including 2,500 in Lucas County - overlooked for nearly a decade during the administration of former Gov. Bob Taft.

The Bomb Shelter was in a batch of 248 canceled firms filed last week by state officials with the Lucas County Recorder's office.

The Ohio Secretary of State's office, which is responsible under Ohio law for notifying counties, in February filed an initial batch of 1,920 county cancellations, followed by 418 more, said Recorder Jeanine Perry, "They're picking up where they left off," she said.

When companies fail to file corporate tax returns or pay income taxes known as franchise taxes, the Ohio division of taxation is supposed to notify the Secretary of State's office after collection efforts fail. The office is then responsible for notifying the firm that its authority to conduct business in the state is revoked. Businesses have the right to appeal.

For years, the filings were an annual event. But they stopped in 1999, said Sue Kinder, recorder in Wood County.

The problem apparently originated in the Ohio department of taxation, which only sporadically sent lists of firms to the secretary of state's office between 1999 and 2006, said Patrick Gallaway, a spokesman for the office. As a result few firms were deleted from state records.

When Jennifer Brunner took over as secretary of state in January, her staff discovered the 50,000-business backlog.

Although many firms on the most recent list filed in Lucas County appear to have closed years ago, Taxation Department spokesman John Kohlstrand said personnel there believe "the backlog is cleared."

Many of the firms are defunct, but some are active concerns that owe taxes to the state.

Jim Moriarty, who owns a construction equipment rental firm, was surprised to learn that his firm had been canceled.

He was unaware of any notification to Howard T. Moriarty Co., Toledo, from the Secretary of State. "I haven't a clue about what's going on," he said. "I'm upset. Things can slip by. But we're very much in business. I'm going to look into this."

"I have to talk to my accountant," said Leslie Furman, of Lee Williams Meats Inc., Toledo. She was unaware of the cancellation.

A number of firms on the list dated from the 1930s and 1940s, including Ger Inc., formed in 1938, Odland Iron Works Inc. (1947), and AAI Holdings Corp. (1948)

Other familiar names include Thomas Noe Inc., operated by an imprisoned local coin dealer who was at the heart of a political scandal involving the state's workers compensation fund.

Contact Gary Pakulski at:

gpakulski@theblade.com

or 419-724-6082.