Dems draw attention to Tinsley’s past tax issues

Democrats are trying to draw attention to some tax issues in Republican 2nd Congressional District Ed Tinsley’s past and other issues with his record as a businessman.

Tinsley’s campaign says it’s nothing more than a tempest in a teapot designed to divert attention away from Democratic opponent Harry Teague’s record of increasing taxes as a Lea County commissioner and his weak performance in last week’s candidate forum.

The Democratic Party of New Mexico is citing several issues in its latest assault on Tinsley. Among them:

• Tinsley had to pay the IRS $65,000 in penalties and interest several years ago because of the late filing and payment of payroll taxes owed by a K-BOB’s Steakhouse. Tinsley owns the chain of restaurants. The IRS initially levied a $122,000 penalty, but the amount was reduced after Tinsley won a court case in which he argued that the original penalty was unreasonable.

• Tinsley testified before Congress in 2004 about a program he created for restaurant employees to encourage savings. The program, K-Care, matched tips employees reported with a 5 percent contribution to an investment fund. He failed to mention during his testimony that, at that time, the program was in forfeiture in Texas.

• Tinsley had to pay back taxes of $113.27 in 2002 to the Lincoln County Assessor’s Office because he failed to register all the livestock that were grazing on his Capitan ranch. He blamed the federal government in a 2002 Alamogordo Daily News article, saying it had not defined how to report livestock that are regularly moved between federal land and private property.

“Ed Tinsley has a long record of tax and other problems with companies he started,” a lengthy document from the Democratic Party about Tinsley’s tax issues states.

The Teague campaign piled on in a statement from communications director Alex Cole pointing out times that Tinsley has been delinquent on paying taxes.

“How can the taxpayers of New Mexico trust Ed Tinsley to manage their tax dollars when he cannot even be trusted to pay his own taxes?” Cole asked. “And how can the people of New Mexico trust Ed Tinsley when just yesterday his lawyer said that he had a ‘stellar record of making timely and complete’ tax payments?”

Cole was referring to an Albuquerque Journal article in which Tinsley’s attorney was quoted as saying that, with the exception of the situation in 1999, Tinsley’s businesses had a “stellar record for making timely and complete payroll tax deposits.”

Tinsley explains

Tinsley spokesman Jim Pettit called the payroll-tax issue “a tax filing mistake” made in 1999 “for which Mr. Tinsley took full responsibility.” He said Tinsley self-reported the problem to the IRS and paid the taxes that were due. When the IRS “tried to assess unfair penalties,” Pettit said Tinsley “refused to get run over.”

“Ed Tinsley does not make any apologies for clarifying with the IRS a proper penalty level,” Pettit said. “The IRS is a difficult bureaucracy to work with and, quite frankly, we need someone in Congress who understands the proper balance between government and business. That fact that the court validated what he was trying to do speaks for itself.”

Pettit also released a document providing answers to several questions related to the payroll-tax issue.

Cole characterized Tinsley’s contesting of the penalty the IRS originally levied as an attempt to “evade the consequences” and said Tinsley should “immediately come clean with the voters and release his tax records related to this matter.”

Pettit said the K-Care program was in forfeiture because Tinsley neglected to pay a $35 fee to the Texas comptroller. He said Tinsley’s testimony was about “government policy that could actually encourage savings in the United States,” but the program is no longer in place because “the tax policies in place right now just didn’t really make it a viable concept, by and large, in entry level jobs.”

Of the livestock issue, Pettit said, “We’re talking about (roughly) $11 per year over a 10-year period. … As a comparison, Ed Tinsley has paid close to $30,000 a year in total property taxes, including real property and personal property, which would include livestock.”

Tinsley says Dems trying to distract from real issues

Pettit said in an interview that Tinsley’s “political operative opponents are pitching stories to media outlets in an effort to distract from Harry Teague’s poor record of raising taxes on the Lea County Commission and equally poor performance in the Oct. 9 forum in which economic issues were discussed. Ed Tinsley’s companies have employed thousands of people over 30-plus years with payrolls estimated to be in excess of $30 million. The track record of all of Mr. Tinsley’s companies is impeccable.”

To try to shift the focus to Teague’s tax record and forum performance, Tinsley released a new television ad today. Here it is:

The ad quotes Teague calling unemployment “rampant” at last week’s forum. Pettit pointed out that the state’s unemployment rate is 4.6 percent, well below the national average of 6.1 percent, and said it’s certainly not rampant.

“That calls into question whether Harry Teague has a fundamental understanding of the issues facing New Mexico on the economy,” Pettit said. “… If he is unable to articulate the problems on the economic front now, it would only be worse in Congress.”