Local News
2:41 pm
Wed December 4, 2013

Kearney: Unpaid taxes won't force me out of the race

Despite owing nearly three-quarters of a million dollars in unpaid state and federal taxes, State Sen. Eric Kearney made it clear Wednesday morning that he has no intention of stepping down as the Democratic candidate for Ohio lieutenant governor.

“I’m in it to stay,’’ the North Avondale Democrat said in a teleconference with Ohio reporters that lasted well over an hour Wednesday. “My wife and I made the decision that we’re going to do this and we’re going to do it; and we’re here to follow it through.”

The 50-year-old Kearney was chosen by Democratic gubernatorial candidate Ed FitzGerald two weeks ago to be his running mate. Late Wednesday, Kearney stepped down from his position as Ohio Senate minority leader, but remains the state senator from Ohio's 9th Senate District. Kearney had planned to step down as minority leader on Dec. 31.

As Kearney was beginning his conference call, reporters around the state received e-mails from the FitzGerald campaign containing what Kearney called “an unprecedented amount of financial information” about the debts owed by he, his wife, Jan Michelle; and their company, KGL Media, which publishes the Cincinnati Herald, an African-American newspaper, and other publications.

Based on the spreadsheets sent out by the FitzGerald campaign Wednesday, KGL Media owes the IRS about $560,000 in back taxes. Kearney and his wife owe $83,000 in back taxes they assumed from KGL. The state of Ohio is owed about $95,000 by the business, but Kearney said both he and the state believe the exact amount is lower.

That adds up to about $730,000.

Since Kearney was named to the Democratic ticket, news media outlets around the state have been reporting that the Kearneys and their company owe hundreds of thousands to the state and federal governments.

But specific numbers came from the campaign Wednesday, two weeks after Kearney joined the ticket.

Kearney was repeatedly asked Wednesday if FitzGerald knew of the tax troubles when he tapped the Cincinnati Democrat to be his running mate.

“To be clear, I provided all of this information to the campaign,’’ Kearney said.

FitzGerald, who is the Cuyahoga County Executive taking on Republican incumbent John Kasich, was not on the conference call.

Kearney and his wife have owned KGL and its subsidiary, Sesh Communications, which publishes the Herald, since the late 1990s.  Kearney said he got out of the day-to-day operations of the company when he became a state senator in 2005.

Kearney blamed a general downturn in the newspaper industry and a former employee who stole money from the company for much of the company’s troubles.

But Kearney said he still believes in the company and is setting it right.

“The Cincinnati Herald is a community newspaper; we believe that it was a good business investment,’’ said Kearney, a lawyer by trade.

“We worked to turn that newspaper around,’’ Kearney said. “We changed the design; we changed the distribution; and we’ve turned the company around. We’ve stabilized it.”

Kearney said he does not believe the unpaid taxes will hinder the campaign to unseat Kasich and Lt. Gov. Mary Taylor. Most voters, he said, will be able to relate to the troubles of a small business.

“This goes to something that every Ohioan can understand,’’ Kearney said. “This is about a small business that went through tough times.”