Did SLO County contractor pocket collected sales tax?

January 23, 2019

By Cal Coast Times Staff

A former contractor with intimate connections to San Luis Obispo’s County’s scandal-ridden waste disposal agency habitually collected sales tax on items he sold to the agency, then appears to have failed to remit those taxes as required, according to state, county, and city records. [Cal Coast Times]

At the same time, contractor Charles K. Tenborg was billing the Integrated Waste Management Authority (IWMA), a public entity, for trucks and other materials for his private business. Even though some of the purchases exceeded $60,000, they were made without board approval, according to IWMA records.

IWMA Program manager Patti Toews said last week that Tenborg regularly charged the IWMA sales tax.

In one illustrative July 2016 example, one of Tenborg’s companies, the Cleaner Earth Company, charged the IWMA $21,541 for used hypodermic needle containers, and collected $1,566 earmarked as San Luis Obispo city sales tax.

However, San Luis Obispo received no sales tax from the Cleaner Earth Company in 2016, according to Jon Ansolabehere, an assistant city attorney.

California’s Department of Tax and Fee Administration approved a seller’s permit for Cleaner Earth Company in July 2012. Sellers pay the sales tax to the state, which then sends the municipality their allocated share.

Charles Tenborg

Tenborg did not respond to a reporter’s efforts to contact him for comment.

The IWMA is the result of a joint powers authority (JPA) between the county and its seven cities, representatives of which make up the agency’s governing board.

Rampant spending of public funds by the agency’s former manager William Worrell, other employees, and contractors has resulted in an ongoing criminal investigation by the San Luis Obispo County District Attorney’s office. Worrell then retired, suddenly and early.

IWMA’s board made little effort at oversight of the questionable expenditures over the last decade, according to former member Tim Brown.

One issue currently under examination is the IWMA’s purported authorization for purchase of trucks and equipment for Tenborg’s companies.

IWMA Administrator Bill Worrell and legal counsel Ray Biering listening to allegations of misappropriation of funds

Since 2008, the IWMA has passed eight ordinances, the legality of which is now being questioned. Many of those ordinances resulted in a steady income stream for Tenborg’s companies.

In 2008, the IWMA passed an ordinance mandating a hypodermic needle waste disposal program. According to the ordinance, the cost associated with the handling and disposal of the home-generated needles was to be borne by both the user and the retailer providing the needles. The ordinance specifically prohibits government monies, including government grants, to be spent on the handling and disposal of needles.

Nevertheless, the IWMA purchased used needle containers from Tenborg for the program, according to IWMA records.

The 2008 ordinance also provided that retailers could utilize private or nonprofit businesses to dispose of the sharps. But instead, the IWMA set appointments for Tenborg’s companies to pick up the needles, billed the retailers, and then provided Tenborg’s companies the payments.

In 2018, the IWMA board — even while confronting the agency’s misappropriated fund problem — passed a “stewardship” ordinance requiring retailers to use only IWMA approved companies to transport their needles.

The IWMA may not even have the legal authority to pass ordinances. The California Constitution grants only cities and counties the power to pass ordinances —  not joint powers authorities such as SLO County’s IWMA.

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That’s not all he pocketed.

I’m confused about the pretext here. Public agencies don’t have to pay sales tax, do they? So why are they paying it?

Good question. Perhaps it was simply another way in which to funnel funds to Tenborg, the same as purchasing a truck for him. With no oversight it’s obvious this agency operated like a piggy bank for Worrell, Biering, Tenborg and who knows how many others.

Thank you Karen and staff for continuing to expose the fleecing of the taxpayers in wonderful SLO county. Our DA won’t do it, our supervisor is a huge part of the problem and no other news agency wants to give us the straight scoop. We can only hope that sooner or later this all comes crashing down on the crooks and you are made whole. I do believe in karma.

It sure is a nice, cozy feeling knowing the FBI, IRS and the State Tax Board have all been given the whole report by Knudsen Investigations. It must really effect Tenborg, Worrell, Adam Hill and Wagstaffe every time they go to sleep. You know it’s coming.

Erik, perhaps you are being facetious, because I don’t feel the slightest little bit cozy. This has been going on for years in this county and continues to grow ever stronger. So far, hardly a peep from law enforcement or the judicial system.

Dan Dow, it is corruption by definition to overlook crimes for your political gain. You are corrupt.

Agreed, Ted. Looking the other way, thus permitting other elected representatives to be on the take is fully complicit. Every elected representative has a first duty to the residents. Ignoring obvious graft, corruption and self-dealing, even if motivated by a desire to get along, makes the DA just as guilty of the evil as those who commit the graft, corruption, and self-dealing.

Businesses that charge & collect a sales tax don’t write a check to the city or the county, when paying that collected sales tax, so WTF with this “news article” ??

The monies get sent to the SBOE (as it was then called – the State Board of Equalization). The SBOE then kicks down to the various gov’t agencies that get a portion of that collected tax.

Unless Cal Coast News has a document or interaction from the STATE gov’t agency, proving that Cleaner Earth Company collected but never remitted any sales tax, this article is useless and pointless.

Jon Ansolabehere, an assistant city attorney, flapping his gums is about as useful a “news source” on this issue as a dead seagull would be.

CCN needs to do a public records request to the (now re-branded) CDTFA, for Cleaner Earth Co’s 2012 Sales Tax form(s) to confirm their allegation of non-reporting/non-payment.

If Tenborg’s CEC business collected, but did not pay these trustee taxes, he deserves a full smackdown from the long arm of the law, just like any other non-compliant business in the state.

Tenborg’s a shady chump, but sketchy reporting tactics don’t help the situation at all, CCN.

Cities know exactly how much sales tax was paid by each seller. I do not know why you think the city would be clueless about the numbers. Also, the BOE broke into two separate agencies with tax and fee administration handling sales tax. And, business tax returns are not subject to the public records act.

Agree with Paul Jones. Each city or county undoubtedly receives a breakdown of the payments they receive from the BOE. The payments would then be credited to each individual business so the city is fully aware of how much sales tax is collected on a quarterly basis at minimum, as this is when district taxes are reported.

My understanding is that CCN’s reporting is based on documents procured by Carl Knudson, and therefore accurate…CCN…how about an answer to this?

What are the odds on if The Fibune ever reports this, and if so, and over/under on the delay?

Oh, they will probably report on it very, very late, and then claim it is THEIR investigative reporting that procured the convictions and then go out for an award based on THEIR investigative reporting. Because, that’s how they roll.

We know Adam Hill is in on this.

If Dow doesn’t act after all that’s been uncovered on this agency, we should all ask ourselves why.

This kind of talent is too rare to go to waste.

Give Tenborg a recreational cannabis license and then let’s get him to run for congress. This is leadership.