Courtney Crauthers

EDMOND — Keg Headz, a group of college students that began a party business, went before Administrative Law Judge Kris Kasper during a final hearing Tuesday in their dispute with the Oklahoma Tax Commission. They will have to wait several weeks and possibly months before a final ruling is made.

The Oklahoma Tax Commission claims the now-closed business owes $64,000 in sales tax that they did not pay while in business. Originally, the commission tried to collect $319,983.43 in sales tax for parties the group charged cover fees for between 2006 and 2007.

After giving their arguments, A.D. Sanderson, who is representing the Keg Headz pro bono, and Martha Oaks, who is representing the Oklahoma Tax Commission, were given 30 days to submit post trial briefs. Kasper then has 30 days to rule on the case.

The men in question include co-founders Jordan Glover and Julius Baroi, Matt Chandler, Drew Taylor, J.T. Weigel and Mike Crawford, owner of MidSouth Pro Wrestling.

The evidence admitted by the Tax Commission included a business card, a MySpace page and “unofficial” information given to them by the ABLE Commission from a raid they made at one of the Keg Headz’s parties.

“I still don’t think they provided the evidence needed,” Sanderson said.

She said her objection to admitting several other MySpace and Facebook pages into evidence was sustained. Sanderson said it also looks pretty good that Crawford will be omitted as a member of Keg Headz.

In a previous Edmond Sun article, Crawford said that Keg Headz rented out his business venue for three parties. However, the Oklahoma Tax Commission included him as an owner of Keg Headz when he was not.

Glover and Baroi formed a partnership when they were University of Central Oklahoma students in January 2006 to fill an unmet need for organized college parties in Edmond. Baroi said that during the course of 18 months, they and other students planned 22 parties at different venues in the metro area under the name of Keg Headz.

The Keg Headz received a letter in December 2007 from the Oklahoma Tax Commission that gave them 30 days to pay the $319,983.43 in alleged sales tax.

They created Facebook and MySpace accounts advertising Keg Headz parties under the hype “Since 1999 and serving over a billion.” Based on that hype, the Tax Commission estimated that Keg Headz hosted about 108 parties with about 700 people in attendance for each party at a cover charge of $5 per person during the course of five years. Based on these estimates, the Tax Commission calculated that Keg Headz owed $162,832.60 in sales tax for liquor and cover charges and $1,856.73 in tourism sales tax.

“Their whole case was based on MySpace and Facebook,” Baroi said. “According to our calculations, we owe about $1,300.”

Sanderson said they may owe even less than that because one state statute is vague about the conditions of sales tax being assessed at the door with a coverage charge.

Baroi also said the venues, not Keg Headz, sold alcohol with valid liquor licenses. Sanderson said the tourism sales tax is based on the alcohol sales and shouldn’t be valid since Keg Headz didn’t sell alcohol.

She said the Tax Commission dropped the charges to about $64,000 after contacting MySpace and confirming that the Keg Headz Web page had not been registered until 2006.

Baroi said in a large packet they received from the Tax Commission, the $64,000 was based on 36 parties with an average of 250 people since 2006. He claims they actually only had about 22 parties.

“My argument is that these numbers are not legitimate numbers,” Sanderson said. “The group Keg Headz has readily admitted they exaggerated the numbers (on their Web sites) to promote their business.”

The attorney said she took their case because she thought the charges were outrageous and the men had been taken advantage of.

The Oklahoma Tax Commission had not returned phone calls for comment by press time.