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Background: Vitacost.com is a vitamin and nutrition supplement online retailer out of Boca Raton, Florida. Vitacost sells national label items as well as items made for their own label using a distribution warehouse built in Lexington back in 2007 with expansion made possible in part by both local incentives as well as $450,000 from One North Carolina Fund in 2010. Listed as VITC on NASDAQ the stock is thinly traded and has remained in the $4.50 to $5 range since it was halted back in December of 2010 after disclosure by the company that it’s financial statements dating back to 1994 were unreliable. Legal action was taken by a group of share holders in 2010 claiming that certain Company officers and directors had “breached their fiduciary duties and unjustly enriched themselves.”

In reviewing a purchase I made with Vitacost I noticed the sales tax rate did not seem to add up and in doing the math I came up with a charge of just over 9%. I then pulled up older orders and found the sales tax rate charged had been incorrect on orders dating back for a year. I emailed the company about the errors and was told that yes they agreed the wrong rate had been charged and if I would provide background information on the orders they would take care of it. I did exactly that but I also stated I was not satisfied with the answer as it appeared this was not a single occurrence and that it looked like the company was charging the incorrect sales tax rates for all North Carolina residents. Needless to say I got no response and didn’t pursue the matter as we were talking about $3-4 so it really wasn’t worth my time. With several months of no response I decided to check their website again and not only were the sales tax rates incorrect but they had gone up to 10.2%! I again emailed the company stating I had pulled the computed sales tax rates for multiple counties in North Carolina and had found not only have they not refunded any money to me but continue to charge an incorrect sales tax rate, of course again I got no response.

So this time I decided to waste a little time and pull some information together for future reference and since I had that info I might as well post it here as well. Using zip codes pulled from Areaconnect.com and Sales Tax Rates from Zip2Tax.com I attempted to checkout using an address based in each of the following zip codes and found the corresponding tax rates being charged by Vitacost.com on a $10 item.

To show I am not just making this up below you will find the checkout form for each of the above zip codes. Does this look like a “math” error to you?

"We believe a large proportion of today’s high unemployment is structural in nature, resulting from a huge skill mismatch between the jobs being created and the existing skill sets of jobseekers," said Mark Vitner, a senior economist with Wells Fargo Securities.

Winston-Salem Journal, July 15, 2011

As I have stated in the past with a shrinking business climate and fewer worker bees you will see a general drop in revenue generated for the local governments. This will result in those governments being required to drastically cut budgets and that means laying off more workers, granted we could do with some trimming of public employees around here. Those cuts however won’t be enough to meet deferred cost on expenses the city of Winston-Salem has taken on such as the Baseball stadium and surrounding obligations or plans for a downtown rail line. As the city will have to meet those obligations the only way to do it in a generally smaller and smaller revenue pool is to raise tax rates. Raising taxes on a workforce that is already leaving the area due to high unemployment will just exacerbate the situation in my opinion and in general delay but not solve the problem. As people are taxed more, see fewer opportunities there is a delay in the ultimate leaving of those workers for other areas of the state or country but it is only a delay as they make those plans, it does not stop the migration or the ultimate result.

Maybe it’s time for The Chamber, The Mayor, Winston-Salem Business Inc., Winston-Salem Alliance to stop chasing “Boys of summer” dreams and start wondering why small business after small business is moving outside of the Winston-Salem area or how a almost 43,000 square foot building set empty for TWO YEARS in a prime retail location? By the way I am speaking of the old Circuit City building on Hanes Mall which finally sold in May to a developer who plans to repartition the location into a multi-tenant space.

The company objective is to take various jets, and outfit them for VIP charter services. The current jet listed is a single 737 outfitted with 64 First Class seats and plans to add a second 737.

You may have forgotten that Winston-Salem is taking Davis Garage in an eminent domain case as Winston-Salem wants to refurbish the building and make it the anchor for the new, yet to be planned, funded or developed, city train system or hub. That Hub is is a requirement in order for Winston-Salem to be consider for the even farther fetched High Speed Rail systems being touted by The White House. At a price of almost $700,000 to condemn and take the Garage then who knows what cost to remodel and upgrade it the city appears to want to be on the hook for even more than their current deals with the stadium.

The initial service will start sometime in November using a single MD-88 however the host of the event, the new COO Guy Cannady, will bring on another plane in December. Services will operate from the Terminal at Smith Reynolds with flights being able to depart to locations as far away as Mexico and the Caribbean.

Hopefully some of those former PACE employees can get onboard with this new airline even if in a part-time mode.  Right now it’s reported they have around 40 full and part-time employees but with added planes they would obviously hire more.

Antimicrobial Technologies Group makes anti-bacterial, anti-viral, anti-fungal and anti-odor fabrics, fibers, plastics and paints. They are looking for a facility in the 100,000 square foot range however commented that they could easily outgrow such a site within a few years. ATG is a relatively new company derived from the research of a professor at the University of South Dakota.  They had a ribbon cutting of their South Dakota facility just last year at which time they employed just a handful of people. Dr. YuYu Sun discovered a N-Halamine molecule which is claimed to fight germs, fungus, mold and viruses, a very bold claim I would think. ATG holds the rights to that molecule and looks to deploy it in everything from paint to textiles, textiles being where Winston-Salem comes in.

Information on ATG is pretty thin considering how new the company is not to mention their products have more or less not been marketed. For a NPR sound bite on the company you can hear the CEO and VP discuss their products and company below. Their website, http://www.antimicrobial.us/ isn’t much help for providing any more in depth information but it appears they probably have less than a dozen employees at this point.

I will point out however that back in October 2009 we posted that Lee Booth had taken over PACE Airlines and was the primary for weeks. The paperwork filed by Edwin Allman III, the Chapter 7 trustee, without a doubt claims Rodgers signed over PACE to Booth and that Booth had indeed taken PACE assets. It appears Allman also states many of those assets are now missing. Unfortunately The Journal doesn’t have a link to the latest court documents so hopefully they will get those online soon.

In other PACE news employees recently discovered PACE did not file 2009 employee earnings with the Social Security Administration.