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Tax Fraud Days of Action 2022: Kentucky
Indiana Kentucky Ohio Regional Council of Carpenters Representatives spoke with state and local officials on April 13th and 14th to learn more and speak out about construction industry tax fraud in Kentucky. Events were held by IKORCC across the three states and sponsored by the United Brotherhood of Carpenters across the United States and Canada.
More than 50 Senate and House Representatives stopped by our setup in the capitol building in Frankfort on April 13th. The statehouse was in session and full which opened the door for IKORCC to make new introductions with lawmakers who were unaware of construction industry tax fraud were made. All 200 meals and toolboxes were handed out.
On April 14th, over 25 officials including area mayors, State Representatives, judges, code enforcement officers, tax clerks, and local business owners attended a lunch and learn about tax fraud.
Tax Fraud Days of Action 2022: Ohio
In four events across the state, regional legislators visited the Indiana Kentucky Ohio Regional Council of Carpenters Training Centers on April 12th and 13th to learn more and speak out about construction industry tax fraud. Events were held by IKORCC across the three states and sponsored by the United Brotherhood of Carpenters across the United States and Canada.
On April 12th, the IKORCC held events in Rossford and Monroe. On April 13th, events took place in Richfield and Columbus. All four events brought in legislators from both sides of the aisle some with little knowledge of the dangerous practice in the construction industry. Read more
Political Update
Indiana
2021 has been another successful year for Indiana politics. The IKORCC managed to harvest a great relationship with the Indiana Association of Public-School Superintendents (IAPSS) and received an invitation to go on tour with them for all eight of their district meetings. During the tour, we were introduced to public school superintendents in all 92 counties. In addition, we were given the opportunity to talk about our Door Safety Inspection (DSI) Program and Career Connections.
One of our many focuses was on getting more “Responsible Bidder Language” added into front end bid specs with school corporations. During the 2021 year, we were able to obtain an additional two agreements with the Metropolitan School District of Boone Township and Concord Community Schools.
Other events worth mentioning that took place during the 2021 year are several successful meetings with political figures regarding laws being introduced to support ICRA training requirements being put in place if any work is being done in occupied health care facilities or schools that may have students present. Also, the City of Indianapolis has promised to make tax fraud and worker misclassification its number one priority for 2022. This commitment came directly from Mayor Joe Hogsett during a public speech that he gave to the city.
During the Delegates conference, Senator Fady Quadra (left) spoke to the membership and explained his level of respect for the Carpenters Union and other organized labor affiliates. He affirmed that he would carry the Carpenters ICRA legislation in 2022.
Due to line redistricting, a Senate seat for District 46 has come up for grabs. We have successfully sourced a candidate that is a card-carrying member of AFSCME whom we helped get elected to the Indianapolis City County Council, to go after this open seat. The candidate has confirmed they will make it known that this seat will be a union held seat if elected. This seat will be won during the primaries due to it being a largely held partisan district.
Kentucky
2021 was a busy political year in Kentucky. Even with the COVID-19 restrictions we’ve been able to build great relationships with local lawmakers and state legislators. Our goals in Kentucky are to address tax fraud and ensure we are in the best position to secure our work with the influx of new solar projects coming to the area.
With solar, it is our hope to introduce language similar to legislation that exists in other states that would protect our work and put our contractor base in the best position possible to secure solar work. Our solar committee, headed up Jeremy Welch and Wallace Turner, has done a tremendous job working with developers and owners to provide information to the political team. That info is vital in working with our lawmakers to sell our training and the importance of the upcoming work.
Tax fraud is a major problem in Kentucky. 1099 worker misclassification and the cash under the table business model used by non-signatory contractors has put our contractor base at huge disadvantage. Working with our Director of Organizing Kenneth Lyons and our political team, we’ve been taking local and state legislators to job site visits to show them the impact and loss of tax revenue that is currently going on.
Now that the November local elections are over, we will actively continue to educate local elected officials about our issues. We use our training facilities to conduct tours and plan to ramp up job site visits. Do not discount the importance you have in actively participating to successfully reach our goals.
If you are not registered to vote please do so. You can register online at vrsws.sos.ky.gov. Moving into 2022 there will be very important races all across Kentucky.
Ohio
2021 was a challenge, politically. Our approach in building relationships with lawmakers became more difficult as a result of the COVID-19 mandates throughout Ohio. Thankfully, we found creative ways to continue building relationships with our local and state lawmakers. We use our four self-funded Ohio training centers as our main selling point with politicians. We continue to take elected officials out for jobsite visits to showcase what we do and also highlight the bad jobsites where tax fraud is rampant due to the lack of legislation in Ohio.
As a result, we continue to build support from both sides of the aisle – Democrat and Republican. We have been successful in protecting our core issues such as Prevailing Wage, Right to Work, and Unemployment Compensation. We are now using our relationships to introduce language to address tax fraud. Our tax fraud bill will create a Tax Fraud Commission to study the impact that paying cash under the table and worker misclassification abuse is having, not only to us but every taxpayer within Ohio. We are aggressively lobbying on current issues to protect our work within all four refineries in the state.
Our motto has always been to Educate, Agitate, and Organize. These very same principles are used when working with any elected lawmaker. Our Ohio political team covers all corners of the state and we will keep every UBC member informed of legislation that may affect us.
With the 2022 election cycle upcoming we will be very busy working for current lawmakers we support and going through a vetting process for any open seats to ensure that the right lawmakers are elected. If you are not already registered to vote, please do so.
You can register online at ohiosos.gov. Remember that when a recommendation is made to support a candidate they are soundly in support of protecting your work, your career, and your ability to provide for your family.
Tax Fraud Days of Action 2021
The Indiana/Kentucky/Ohio Regional Council of Carpenters joined UBC members across the United States and Canada to raise awareness for construction industry tax fraud. Check out highlights from IKORCC Tax Fraud Days of Action events in Indiana, Kentucky and Ohio.
Indiana Tax Fraud Day of Action Event
The Tax Fraud Day of Action event in Indianapolis was a tremendous success. Business representatives and members of the IKORCC Executive Board spent a few hours educating lawmakers on tax fraud, with a special emphasis on solutions to tax fraud. Of the 150 elected officials invited, 62 lawmakers, both republican and democrat, visited the event and learned more about construction industry tax fraud. Indianapolis Mayor Joe Hogsett also attended the event.
The Indiana event was held at the Indiana State House atrium. To drive attendance to the event, IKORCC reps handed out tax fraud toolbox/lunchboxes packed with concrete solutions to fight tax fraud. The theme of the giveaway was, “You already have all the tools you need to fight tax fraud”. The toolboxes were a big driver to our event.
The solutions inside included: enforcing existing laws, creating a tax fraud task force, sharing information amongst government agencies and responsible bidder ordinances or RBOs.
In addition to the in-person event, the IKORCC created a new website, endtaxfraud.com. The website focuses on the actual solutions to tax fraud and what lawmakers and the public can do to help.
Kentucky Tax Fraud Day of Action Events
We held a two day Tax Fraud Awareness event in Louisville, Kentucky this year. On the first day, we visited a dorm under construction at the University of Louisville, with predominantly union subcontractors. We educated members of all crafts about Tax Fraud and how important it is to get involved politically with elected officials to help eliminate this illegal business model. It was an extremely successful event. We also educated and built relationships with company management teams.
On the second day, we took our messaging to a non-union led job site in Louisville. We used this as an opportunity to educate owners, workers and management teams while also gathering info on Labor Brokers, potential future members, and accurate counts of employees being paid cash or with a 1099. This gave us a new angle on how to fight tax fraud.
Ohio Tax Fraud Day of Action Event
Tax Fraud Days of Action in Columbus was a successful day of educating legislators and the public on why tax fraud is a danger to everyone. Legislators from both sides of the aisle and even some who we didn’t have a previous relationship with us, showed up to learn more about tax fraud. Legislators loved the tax fraud lunchboxes and were excited to talk about upcoming projects in their areas and what our organization has going on.
All IKORCC Representatives onsite had legislators from their area represented in the turnout.
Check out a video interview with Democrat House Minority Leader Emilia Sykes about tax fraud.
Here is another video with Republican House Representative Jay Edwards
Former Industrial Representative and UBC instructor Steve Griffith also stopped by and gave us an interview.
House Bill 397 Good for Kentucky Workers
We need your help to protect working families like yours. The Kentucky State House is considering House Bill 397, which penalizes commercial contractors caught cheating on bid day by treating employees as subcontractors. It levels the playing field so law-abiding contractors can keep you working. Kentucky residents, call your State Representative at 1-800-372-7181 & tell them to support HB 397.
Call to the Hall! Ohio Carpenters To Rally Against Tax Fraud at Columbus City Hall
Ohio carpenters & their families will rally outside of the Columbus City Hall on Monday, April 15th from 11 a.m. to 1:00 p.m. to shine a spotlight on the corrupt practices of illegitimate contractors who steal billions of dollars from our 
communities – money that should be spent on education, public safety, and infrastructure. Tax fraud is just one aspect of the illegal business practices plaguing the Ohio construction industry, along with wage theft, independent contractor misclassification, and workers’ compensation insurance fraud.
The Indiana Kentucky Ohio Regional Council of Carpenters (IKORCC) will join area members in the fight to crack down on these destructive and illegal business practices at the Columbus City Hall. The IKORCC hopes the event will bring awareness of the damage tax fraud causes in Ohio and encourage the Columbus City Council to take action to stop it.
The fraud comes when workers are paid off the books by shady subcontractors and labor brokers, who are hired by contractors to underbid law-abiding businesses. Fraud happens on all types of projects, including taxpayer-funded projects —, which means we all lose. Rampant cheating in the construction industry makes it difficult to repair roads, bridges and schools, care for veterans and shore up Medicare and Social Security.
Construction industry tax fraud and related crimes and violations are happening every day on large-scale projects, costing Ohio communities an estimated $248 million dollars in state and local taxes.
Recovering unpaid tax dollars in Ohio could pay for:
- 7,937 teachers
- 325 miles of resurfaced highways
- 49% increase in school construction/ renovation
The April 15th rally in Columbus is part of the nationwide Construction Industry Tax Fraud Days of Action by the United Brotherhood of Carpenters and Joiners of America to raise awareness and generate action against tax fraud and related crimes.
Indianapolis Mayor Joe Hogsett Talks Tax Fraud at Indiana Statehouse
Lawmakers, contractors, and construction workers in Indianapolis are preparing for Days of Action events to bring attention to the growing problem of tax fraud in the construction industry.
Over 100 Indiana lawmakers, contractors & construction workers will gather at the Indiana Statehouse on Monday, April 15th, 2019 from 11:00 a.m. to 1:00 p.m. in the north atrium to shine a spotlight on the corrupt practices of illegitimate contractors who steal billions of dollars from our communities – money that should be spent on education, public safety and infrastructure. Tax fraud is just one aspect of the illegal business practices plaguing the industry, along with wage theft, independent contractor misclassification, and workers’ compensation insurance fraud.
Indianapolis Mayor Joe Hogsett will share his thoughts on tax fraud in Indianapolis and how it hurts the city. Mayor Hogsett addresses the crowd at 12:15 p.m. “It’s tax fraud, because it’s the taxes that you and I pay that are being manipulated,” said Joe Hogsett, Mayor of Indianapolis. “From neighborhood-based programs to major initiatives, to the public/private partnerships that drive our city forward – all of these things are only possible when everyone pays their fair share.”
The Construction Industry Partnership will be joined by the Indiana Kentucky Ohio Regional Council of Carpenters, state & local lawmakers and some of the state’s most prominent business owners in the fight to crack down on these destructive and illegal business practices.
The fraud comes when workers are paid off the books by shady subcontractors and labor brokers, who are hired by contractors to underbid law-abiding businesses. Fraud happens on all types of projects, including taxpayer-funded projects—which means we all lose. Rampant cheating in the construction industry makes it difficult to repair roads
Construction industry tax fraud and related crimes and violations are happening every day on large-scale projects, costing Hoosier communities an estimated $405 million dollars statewide in lost federal and state taxes.
Recovering unpaid tax dollars in Indiana could pay for:
- 8,741 state troopers
- 7,937 teachers
- 325 miles of resurfaced highways
- 783 small business loans
The April 15th rally in Indianapolis is part of the nationwide Construction Industry Tax Fraud Days of Action by the United Brotherhood of Carpenters and Joiners of America to raise awareness and generate action against tax fraud and related crimes.
About the Construction Industry Partnership:
Representing the carpenters union and over 700 contractors throughout the state of Indiana, the Construction Industry Partnership is dedicated to create a lasting and positive impact on the construction industry. By acting as one unit, the CIP can advocate for change at a political level, demand high standards are enforced and recruit top talent throughout the state.
Indianapolis Mayor Joe Hogsett Helps Fight Tax Fraud
In March, Indianapolis Mayor Joe Hogsett visited the IKORCC to discuss the growing issue of tax fraud and the effects it has on responsible contractors, 
the city, and taxpayers.
Tax fraud occurs when companies misclassify workers who should be employees in order to avoid paying their fair share of unemployment insurance and federal, state and local taxes. Companies that commit tax fraud are often able to give lower bids on projects since they aren’t paying their share of taxes – a practice which makes it difficult for responsible contractors to compete fairly.
“Everybody ought to have the right to compete fairly,” Mayor Hogsett said while addressing contractors. “I want to be clear – what the city seeks to do is not to pick winners and losers. Our job is to make sure everyone is operating on a level playing field,” Hogsett added.
Mayor Hogsett also acknowledged that the IKORCC has been at the forefront of the battle against tax fraud. “The carpenters have really taken a leadership role in this regard,” he said.
In response to the growing tax fraud problem in the construction industry, Mayor Hogsett says he put together a working group to explore the ordinances in place within the city and the means of enforcing these policies. “The ordinance is a bit vague in the enforcement area,” he said, adding that he hopes to have an enforcement officer in place in the future to cut down on tax fraud.
The IKORCC has seen an increase in the prevalence of tax fraud in Indiana, Kentucky, and Ohio and hopes to work with Mayor Hogsett and the working group to help curtail the issue.
Residential construction industry built on ‘payroll fraud’ model
MINNEAPOLIS, Minn. – Jose Ramirez had never heard the term “wage theft,” but he knew he was being cheated when a roofing subcontractor refused to pay him.
“We finished a couple houses, roofing houses, and we tried to collect the money and the guy said, ‘I haven’t gotten paid by our boss,'” he recalls. “That was a big project. I mean, we were shingling one house, putting back shingles, moving to the next one, and eventually there was two of them where I did not get paid. I told the guy, ‘That’s it. I can’t keep working until you pay me those two houses.'”
“So they stop answering the phone, you start chasing them for the money, and then suddenly, they disappear . . . and there you go – you got two weeks without pay . . . So you have to figure out how you’re going to support your family.”
Today, Ramirez is one of the lucky ones. After seeing a billboard advertising the carpenters union, he called and signed up. He spent several years with a reputable contractor and just recently became an instructor in the training center operated by the North Central States Regional Council of Carpenters.
Looking back, Ramirez realizes that not getting paid to roof two houses was just the tip of the iceberg. He was being cheated every day on the job, forced to work long hours without overtime pay. Often, he never got a paystub to track whether or not he was being paid for all the hours he worked.
Fortunately, he did not get injured on the job. Even though construction employers are required to carry workers’ compensation insurance, untold numbers of injured workers have been fired, left to try to get medical help on their own.
“Back in the day, I didn’t know that you had those rights,” said Ramirez. “I have friends who still work the same way. Depending on the situation that they have, some people don’t think they have a choice but to work that way. People have to make a living.”
Tens of thousands of construction workers are victims of wage theft in Minnesota ever year, but no one knows the exact number. Some of the workers are undocumented and afraid to come forward. Many, regardless of their background or citizenship status, simply don’t know that they are being cheated.
Source: Workday Minnesota