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Audit Finds nTelos Pavilion Tax Shortfall

(CelebrityAccess MediaWire) — According to a recent audit, the operators of the nTelos Pavilion at Harbor Center owed the city of Portsmouth, Virginia, approximately $75,000 in unpaid admissions taxes from past concert seasons.

Harbor Center Joint Venture, which operates the venue, paid the tax bill last month and is appealing the audit findings. The company could actually owe more money, as auditors haven’t finished a review of whether taxes were paid on complimentary tickets, according to the Virginian-Pilot.

The audit results come as the city begins confidential negotiations for a new management contract at the troubled amphitheater. Five companies submitted proposals for the job, including Harbor Center Joint Venture, but city officials said they could not disclose which business they had chosen to deal with.

A panel made up of city officials, residents and concert venue experts chose the finalists in a two-day closed process in September, and will make the new agreement public once the contract is signed.

The audit, routinely done by the city’s Commissioner of Revenue’s office to make sure businesses are paying their taxes, will lead to a meeting soon between the office and Harbor Center Joint Venture representatives.

At issue with the audit is whether the company paid all the admissions taxes on box seats and season tickets, and whether the city accurately recorded how much the company paid. Admissions taxes are paid by all entertainment venues in Portsmouth, from movie theaters to concert halls, and are assessed at 10 percent of the ticket value.

In a letter sent by Harbor Center Joint Venture attorney Todd Fiorella to the Commissioner of Revenue, Fiorella said the company would pay the back taxes “under protest,” according to the paper. Fiorella also questioned whether the city correctly calculated taxes from 2002. According to city records, the company paid $216,000 in admissions taxes that year, but Fiorella said the company had receipts for $245,000 in payments.

“Obviously our calculation differs from theirs,” he told the paper. “I don’t think you could have a better taxpayer than having someone who pays them when there’s a question about some of the calculations. But that’s one of the issues we’re going to be discussing.”

The rest of the unpaid taxes stemmed form box seat and season ticket sales, which Fiorella said in his letter should be considered venue sponsorships, without any ticket value.

The Commissioner of Revenue’s office felt differently. –by CelebrityAccess Staff Writers