MESC says Barrett Refinery owes $2.23M in back payments

Published 12:00 am Friday, February 27, 2004

[2/27/04]The state’s unemployment-insurance administrator has asked for money from a defunct Vicksburg refining company whose former property has recently been sold for back taxes.

Barrett Refinery, which operated at 2222 Warrenton Road, owes $2,232,619.67 in back unemployment taxes and penalties, Mississippi Employment Security Commission records filed with the Warren County Circuit Clerk’s Office show.

The Oklahoma-based company filed for Chapter 11 bankruptcy protection there in February 1996. It never emerged from the process, and the case was closed in April 2003, records show.

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The property on which it operated was bought in 2001 by Howell Refining Inc. of Chicago. No taxes have been paid since, and the company owes $23,044.42, records show.

In November, the county’s tax claim against the company matured, meaning the company failed to bring its tax payments up to date within two years. The expiration of that time allows the property to be sold to the high bidder in a tax sale, and records here show Warren County issued a deed Nov. 5 to a Mississippi property company that plans to purchase it.

The MESC’s claims say the money is owed because the Barrett company did not pay its taxes from April 1991 through December 1999 and from July through September 2003. Since unemployment-insurance contributions are capped at $378 per-employee annually and the company employed fewer than 50 people, the $2.2 million includes other charges from the MESC.

Companies may contest such amounts the MESC judges it is owed, said commission communications director Jan Garrick.

“We don’t have the full body of information before us” when making such assessments, she said.

The liquidating agent for the company, David Rhoades of Turnaround Professionals in Oklahoma City, said the Barrett Refining bankruptcy estate contains no assets, making the MESC’s claim uncollectible.

MESC communications director Jan Garrick said if any successor company purchases the property and resumes operations on it, that company could have to pay the back unemployment taxes.

Such claims for back unemployment insurance are usually triggered by a former employee’s filing a claim for unemployment benefits, Garrick said. They may also be initiated by MESC field agents, she said.

Before filing for bankruptcy protection, the contract operator for Barrett faced pollution and other allegations from the state environmental-quality department and the federal workplace-safety agency.

A lawsuit by five former employees against the operator, Houston, Texas-based M&S Petroleum, claimed the employees were harmed by excessive emissions from the refinery.

The employees won a judgment in that case, but were never paid because M&S was out of business by the time the judgment was issued, said Frank Campbell, a Vicksburg attorney who represented them.