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Mayor Cannon’s parking firm says it will correct tax errors

CANNON_ELEX_DAY_08
DAVID T. FOSTER III - dtfoster@charlotteobserver.com
Patrick Cannon gives his acceptance speech at the campaign watch party at the Sheraton Charlotte on November 5, 2013. Cannon won the Charlotte mayoral race. David T. Foster III-dtfoster@charlotteobserver.com

Charlotte Mayor Patrick Cannon’s parking management company, E-Z Parking, says it will change how it pays its city taxes after the Observer questioned why the company incorrectly filed business licenses on the roughly 20 lots and decks it manages.

A parking management company is required to pay a Business Privilege License tax annually on each lot or deck it operates. But E-Z Parking has licenses only for its headquarters and two decks in the past year and hasn’t obtained separate licenses on all of its decks or lots for several years, according to a review of county tax records.

Cannon, the chief executive, and Jeff Feemster, the chief operating officer, said E-Z Parking wasn’t aware it needed individual licenses for each lot or deck.

But both men said the company has paid its taxes on all of its revenue, and they said they are certain they don’t owe the city of Charlotte any money. Ultimately, they say, the company’s only error is the technicality of not obtaining a license for every lot.

“We accounted for 100 percent of the revenue – I’m sure of that,” Feemster said. “We want to do things the right way, but sometimes you don’t get things right.”

County records show that E-Z Parking paid the tax on its home office at 312 W. Trade St. and two other decks.

Feemster and Cannon said they believed they were only required to have a Business Privilege License where they have an office.

The county’s tax collector, Neal Dixon, said a business such as a parking management company would need to pay the tax on each lot it manages, regardless of whether it has an office there.

“We are in the process of doing that now,” Feemster said.

Revenue from the tax helps the city pay for police, fire, roads and sidewalks, among other services.

Dixon said businesses are sometimes confused about how to file the taxes, and other companies have made the same mistakes that it said E-Z Parking committed by placing several locations on one license.

“It’s possible they could have paid the right amount of tax and reported it under the corporate location,” Dixon said. “It would be hard to tell without a full look at the books.”

Unlike property taxes, the amount someone pays for a Business Privilege License tax is not a public record.

Dixon said he doesn’t know whether E-Z Parking has paid the correct amount of tax. If it has, the county tax office would work to ensure the business files its taxes properly in the future. There would be no penalty for not having its paperwork filed correctly, he said.

The company would be responsible for any back taxes it hasn’t paid.

Dixon couldn’t be reached last week to respond to a question about whether the tax office would audit the company.

A parking management company would have to pay a Business Privilege License tax of 60 cents for each $1,000 of revenue on each lot. There is a minimum tax of $50 on each lot or deck it manages.

It’s possible that a company could pay the tax on all of its revenue, however, but still owe the city a Business Privilege License tax.

E-Z Parking manages a county-owned deck at ImaginOn. It is paid $9,000 a year to manage the deck, in addition to its expenses.

Feemster said he is certain the company has paid its taxes in full. He said E-Z Parking was given a refund from the amount of Business Privilege License tax it paid about six or seven years ago and said no one told the company it was filing its paperwork incorrectly.

“As far we know, the documents say we are paying what we are responsible for,” Cannon said.

Cannon, who was first elected to the City Council in 1993, was elected mayor in November, defeating Republican Edwin Peacock. He founded E-Z Parking in 1998.

Dixon said his office takes steps to ensure compliance, such as looking at advertisements for new businesses to see whether they have paid or looking at county health inspections for new restaurants to see whether they are compliant with the tax.

Dixon said his office has not received any complaints about E-Z Parking.

One of the city’s largest parking management companies, Preferred Parking, has Business Privilege Licenses for 39 lots, according to the county’s website.

The website for LAZ Parking says it manages 10 uptown lots and garages; the firm has paid Business Privilege License taxes on all of them.

Secure Parking’s website says it manages a dozen lots or decks in uptown, near the Seventh Street light-rail line, and has paid the Business Privilege License tax on all of them.

In addition to a license for its home office, county records show E-Z Parking paid the Business Privilege License tax on two decks this year. One is the Carolina Medical Center garage at 1000 Blythe Road; the other is a parking deck at 225 E. Sixth St., near Time Warner Cable Arena.

Harrison: 704-358-5160
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