Olympia’s first strip club closed this month over unpaid taxes, but the debt pales in comparison to Thurston County’s most delinquent taxpayers who collectively owe the state millions of dollars.
Desire Gentleman’s Club at 3200 Pacific Ave. can no longer do business because its parent company, Grey Industries LLC, owes $3,204 in taxes, according to the state Department of Revenue.
However, the highest debt in Thurston County — and second highest unpaid tax bill in the state — belongs to a company based in LaGrange, Georgia. Diverse Buildings and Components LLC owes $1,768,446 in unpaid taxes, according to the state, which issued a warrant in May and has not yet revoked the company’s license.
Diverse Buildings and Components specializes in pre-engineered steel buildings. The Georgia company’s tax bill includes nearly $700,000 in penalties and fees, according to state records.
Chris Johnson, president of sales, said the company’s legal team is working on the case with the state. He said the company had received a government contract in 2012 for Border Patrol station projects in Oroville and Colville. Johnson told The Olympian that Diverse Buildings, which registered in Thurston County, was one of several contractors involved with the military project. The state’s tax bill exceeds the company’s average annual sales, he said, and is “grossly exaggerated.”
“There’s no way our tax could be that high,” Johnson said. “We were a very small part of the project.”
The highest unpaid tax bill in the state belongs to Master’s Touch Drywall Inc., which owes $2,030,280. In 2010, company owner Mark D. Standley of Marysville was sentenced to 75 months in prison after failing to pay restitution. Standley had admitted to reporting less than one-half of 1 percent of the sales tax he collected on drywall work from 2003-2008, and also failed to pay workers compensation premiums for employees, according to the Department of Revenue.
The highest total unpaid tax bill from Eastern Washington is $546,667 by Yadira E. Sandoval, owner of The Phone Lot in Yakima County. That business closed at the end of 2011, and the state’s most recent tax warrant was issued in September.
Most of the businesses on the delinquent taxpayer list are closed, either by getting their license revoked or closing on their own accord, said Kim Schmanke, spokeswoman for the Department of Revenue. The department revokes a business as a last resort, often when a business is unresponsive, she said.
Open businesses in the list could also be in negotiations with the department to reach a payment agreement, she said.
“We use the same tools to collect from out-of-state businesses that we do for in-state businesses: seizing or levying bank accounts, business property and accounts receivable,” Schmanke said.
Schmanke said it’s harder to recover debt from a closed business, and the department can sometimes collect the debt from an owner’s new business venture when applicable. Regardless of whether a business has closed, the debts stay on the books until they are paid, she said.
In the end, the department is trying to protect the state’s interests — in this case, tax money.
“Our goal is to keep businesses in business, making payroll and supporting the economy,” Schmanke said. “Once we file a lien with a business, it doesn’t mean we stop working with them.”
THURSTON COUNTY’S TOP 10 DELINQUENT TAXPAYERS
The following list was reported by the state Department of Revenue. Included is the amount owed, along with the debtor’s location and tax account status with the state. The total amount of these unpaid tax bills, including penalties and interest, is $3,053,928.