August 19, 2012 in Idaho

Eye on Boise: Hart’s Audi raises eyebrows amid bankruptcy

By The Spokesman-Review
 

When tax-protesting state Rep. Phil Hart filed for bankruptcy amid federal and state claims that he owes more than half a million dollars in back taxes, penalties and interest, papers he filed with the bankruptcy court said his assets were few – and that the only vehicle he owns is a 1990 Toyota pickup with 310,000 miles on it that “needs work.”

But arguments filed by federal prosecutors in the case last week questioned that, saying, “It is particularly appropriate to permit further inquiry into these assets given that Hart admitted to using a holding company for an Audi.”

In bankruptcy proceedings, Hart acknowledged that he is a 50-50 partner in a firm called “White Snow LLC” that owns the 2000 Audi he drives regularly and keeps at his Athol home. White Snow LLC “has never done any business or filed any tax returns,” wrote U.S. Department of Justice attorney Adam Strait.

At a hearing last month, Hart said of the LLC, “Its purpose is if there’s a business opportunity that presents itself and there’s a need for an entity to pursue that business, it’s available.”

Idaho House records show that during this year’s legislative session, Hart was reimbursed more than $3,600 for mileage on a personal vehicle for driving between Athol and Boise, an 888-mile round trip he made nine times between January and April.

Last week, Hart filed a motion to dismiss his Chapter 13 bankruptcy case, after agreeing in a stipulation to either convert the filing into a Chapter 7 or Chapter 11 bankruptcy, or drop it. Creditors now have until Aug. 25 to weigh in on the dismissal motion, which still could allow for refiling.

Jobless rate hits three-year low

Idaho’s seasonally adjusted unemployment rate hit a three-year low in July, falling two-tenths of a percentage point to 7.5 percent, the Idaho Department of Labor reports. Meanwhile, the national unemployment rate rose a tenth of a point in July, to 8.3 percent.

The Conference Board estimated that Idaho now has fewer than five unemployed workers for every two posted job openings. At the peak of the recession in 2009, there were nine unemployed people jostling for every two posted job openings in the state.

State on track for surplus

Wondering where the state’s finances stand? The state Division of Financial Management recently revised its fiscal year 2013 general fund revenue forecast downward by $29.6 million to $2.6077 billion; add that to the state’s beginning balance for fiscal year 2013, which started July 1, and there’s $36.1 million more available than the estimate used by the Legislature this year to set the fiscal-year 2013 budget.

Included in the revisions: impacts of law changes, including a $35 million permanent tax cut for corporations and top earners.

The revised forecast is 3.2 percent above actual collections in fiscal year 2012. The state still must cover costs for fires, pests and hazardous material incidents that occurred last year, but even after that, there’s an estimated ending balance for fiscal year 2013 of $31.8 million. That’s $27.3 million higher than what lawmakers expected at the close of this year’s legislative session. In other words, if the forecast holds, the state would finish the year with a surplus, even after the tax cut.

Although July tax revenues came in slightly below the forecast, at $3.4 million below, revenues still are tracking higher this year than last year – $10.1 million higher.

Idaho fugitive nabbed

The Las Vegas Review-Journal reports that fugitive “sovereign citizen” movement leader Samuel Davis, of Council, Idaho, who calls himself “I am: Sam” in court documents to symbolize his refusal to recognize the establishment, has been arrested in North Dakota. Davis, 57, faces nearly five years in prison for his role in a $1.3 million money laundering scheme in Las Vegas; he pleaded guilty, but went on the lam in June rather than surrender to serve his prison time.

Davis’ co-defendant, Shawn Rice, a self-proclaimed attorney and rabbi from Arizona, was convicted last month. Adherents of the “sovereign citizen” movement declare themselves above the government’s jurisdiction and claim they’re not obligated to pay taxes or comply with various other laws.

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