Report: BRT assessor evaded tax
An electrical supply company operating out of his house, run by his wife, has never paid business-privilege taxes.
The top assessor at the troubled Board of Revision of Taxes has some tax troubles of his own.
An electrical supply company based at the Northeast Philadelphia home of Barry Mescolotto, the BRT's acting chief assessor, has not paid any city business-privilege taxes - though it's received $917,000 in contracts from SEPTA, according to a new report by the city Office of Inspector General.
"This is particularly egregious considering his position with a city taxing authority," says the report, sent to the BRT on April 21 and obtained by The Inquirer yesterday.
Although his wife, Valentina, is listed as president and treasurer of Trans-lectric Supply Inc., Mescolotto has signed some company contracts with SEPTA and submitted at least one bid using a BRT fax machine, the inspector general found.
Mescolotto told the inspector general that he knew that his wife within the last six months "got some type of tax bill," but said he did not know what the bill was for or how much was owed. Mescolotto said his wife was in "the process" of paying.
He and his wife did not respond to calls seeking comment.
Kevin Feeley, a BRT spokesman, said he could not talk about the details of the investigation, and complained that "whoever leaked the report decided that they didn't have to play by the same rules."
He said Mescolotto, 56, is a "decent, hardworking man" who has done his best to try to keep assessments fair and impartial. The agency is still looking for a permanent director of assessments, he said.
For the last year, Mescolotto has been serving as the top assessor at BRT, supervising the task of setting values for all 577,000 properties in Philadelphia. He was paid $92,635 last year, second only to Executive Director Enrico Foglia, who says he has nothing to do with assessments.
The timing of the disclosure could not be worse for the BRT, which has been under siege since an Inquirer series detailed a history of mismanagement, patronage hiring, and deals for insiders.
Last week, Mayor Nutter asked board members to resign. They quickly refused, noting that they do not answer to the mayor. But the agency's future is still in doubt. City Council is considering a bill that would break up the agency and turn over property assessments to someone else.
Records show that Trans-lectric, a wholesale distributor of electrical equipment, was formed in 1987 with its address as the Mescolottos' house in the 1300 block of Brighton Street. Valentina Mescolotto is listed as president and treasurer.
The company does not have a business-privilege license and has not filed city tax returns since it was incorporated, according to the inspector general's report. The amount owed is confidential unless the city files a judgment against the taxpayer, Nutter administration spokesman Doug Oliver said in an interview.
The company received 139 payments from SEPTA between 2005 and 2008, totaling $917,359. A spokesman for SEPTA said it could not immediately provide information on Trans-lectric's contract.
Under BRT rules, the agency must give permission for employees to hold outside jobs. Barry Mescolotto told the inspector general that he never sought permission because "I have nothing to do with the company."
But SEPTA documents show Barry Mescolotto as the company's contact person. He communicated with SEPTA procurement officials and signed some company contracts.
Shown those records, the report said, Mescolotto said that he occasionally helped out his wife with computer work, or dropped off documents. He said that he does not get paid by the company and does not perform its work on BRT time.
He signed contracts only because they needed two signatures, he said.
Mescolotto listed income from Trans-lectric on his financial disclosures in 1999 and 2000, but not since.
J. Shane Creamer, executive director of the city ethics board, told the inspector general that Mescolotto was not required to do so because he was not a company officer and was not receiving direct compensation.
The inspector general, though, concluded that Mescolotto "has an active role" with the business and should have disclosed it to his superiors at the BRT.
Calling the unpaid bill "embarassing," the report says Mescolotto should not get the top assessor's job permanently until the company gets a license and pays what it owes.
As for property taxes, the Mescolottos pay $2,440 a year on their 1,400-square-foot home, city records show. Those taxes are up to date.