The tough economic times have created tax troubles for Lawrence City Commissioner Lance Johnson.
A company partially owned by Johnson is about $147,000 behind on its real estate taxes in Johnson County. Two other companies that Johnson partially owns have about $6,300 in past due taxes on various pieces of real estate in Douglas County.
Johnson — president of Lawrence-based civil engineering firm the Peridian Group — said the downturn in the real estate and development industries had hurt his finances.
“I’m not different than any other person out there struggling in these times to pay the bills,” Johnson said. “But I understand the difference is that I am in the public eye. There is a spotlight on me. It is not a good example to set. I understand that.”
But Johnson said he does not believe the tax matters will affect his ability to carry out his duties as a Lawrence city commissioner.
“In fact, it probably helps me do it better,” Johnson said. “It makes me sensitive to people’s financial situations. I’m struggling like everybody else.”
The tax matters, though, have brought up questions that go back to Johnson’s election to the commission in April 2009. The company behind on its taxes in Johnson County — RKJ Properties LLC — was not listed on Johnson’s statement of substantial interest when he ran for the commission. The company owns the building that houses the Peridian Group’s Gardner offices. The substantial interest form requires candidates to lists ownership interests that total either 5 percent or $5,000 or more in a company.
Johnson said he erred by not placing the company on the form. He said he originally thought he was not required to do so because his ownership interest in the company was held by another LLC that he owns. But Johnson said Thursday that he now realizes he also has an individual ownership interest in RKJ Properties that should have been listed on the form.
“I wasn’t hiding anything. I wasn’t trying to keep anything from anybody,” Johnson said, pointing to the fact that he did list on the form 28 separate business entities or properties that he has an ownership interest in.
During the time of the campaign, RKJ had some taxes past due but was not technically delinquent. The first half taxes of 2008 were due on Dec. 20, 2008, about the time Johnson started his campaign. RKJ did not make the first half tax payment. The second half payment was due May 10, 2009, about a month after the City Commission election. That payment also wasn’t made.
As part of its campaign coverage, the Journal-World reviewed Douglas County property tax records of candidates. Candidates also were asked if there were any tax issues or other legal issues they wanted to disclose. Johnson did not mention the RKJ issue.
On Thursday, Johnson said he’s not sure he was aware of the tax issue during the campaign.
“I don’t know how much I knew about it in 2009, honestly,” Johnson said. “The members of the company share responsibilities. You count on things to get done and obviously they haven’t.”
In addition to the business real estate taxes, two vacant lots owned by a trust held by his wife also have taxes that are past due. Second half 2009 taxes, which were due May 10, have not been paid on the two pieces of property in the 900 block of Robinson Court, according to the Douglas County Treasurer’s Office. The taxes total $1,019. Johnson said that was an accounting oversight and the taxes would be paid soon. The taxes for Johnson’s home and his primary business, the Peridian Group, are current.
“I hope people understand that I have paid property taxes,” Johnson said. “I have been a taxpayer in Douglas County for 15 years, and I’ve been current.
“I just turned 40 recently, and I can tell you that these are the most challenging times I’ve ever lived in. It is tough to be a small-business owner right now.”
Johnson’s term on the commission, his first, runs until April 2011.