Campaign 2010

Sep 25, 2008

The Hill - Tinsley program in forfeiture

Congressional candidate Ed Tinsley (R) testified before Congress in July 2004 on behalf of an initiative he created for his restaurant employees that he said resulted in increased tip reporting.

But earlier that year, the charter for the program had been forfeited.

Tinsley, the owner of chain restaurant K-Bob’s, launched the K-Care program several years ago as a way to reduce a high rate of staff turnover. K-Care matched reported tips with a 5 percent contribution to a mutual fund in a 401(k)-like program.

But while Tinsley sang the program’s praises, it apparently was in forfeiture in Texas, according to documents obtained by The Hill.

According to the state comptroller website, Texas law says corporate privileges may be forfeited “for failure to file a report … or pay the [franchise] tax within 90 days after the due date.”

Once corporate privileges have been forfeited, the secretary of state can move the corporation’s charter into forfeiture if “taxes have not been paid within 120 days after the date the privileges were forfeited.”

A secretary of state document shows the charter was ordered forfeited in February 2004. The comptroller’s office said K-Care LC initially failed to file a report on time, remains in forfeiture and hasn’t filed a report since 2005.

In a statement, Tinsley’s campaign didn’t address the forfeiture: “K-Care is a savings initiative developed for the restaurant industry. Many restaurant employees are young people who have the opportunity to start saving early in life. One of the best ways to accomplish this is in a systematic way with their employer.”

Tinsley is a former chairman of the National Restaurant Association. K-Bob’s, a value steakhouse chain, is located in New Mexico, Oklahoma and Texas.

He is running against Democrat Harry Teague for Senate candidate Steve Pearce’s (R) seat.

During his 2004 testimony, Tinsley said he was searching for a way to reduce a 230 percent turnover rate at his restaurants — a rate twice the national average — and increase the percentage of employees who thought the restaurants were concerned about their welfare.

He said that after the program was initiated, turnover fell to 110 percent, while 61 percent “totally agreed” that the chain was concerned about their welfare.