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Tax officials begin audit of Barnett's camps

DENVER -- State tax officials on Wednesday began reviewing a
highly critical audit of the University of Colorado and football
camps run by former coach Gary Barnett to determine whether anyone
owes taxes.

State auditors said this week that football camp records were in
such a mess that they couldn't be sure whether more than $400,000
worth of transactions broke any rules. The audit also cited
repeated examples of financial carelessness inside the athletic
department and said some state taxes may not have been paid.

Members of the Legislative Audit Committee voted Tuesday to ask
the state Department of Revenue to examine the audit report.

"We're concerned that there was some taxes that weren't paid,"
said committee member Sen. Deanna Hanna, D-Lakewood. "We want to
know what can be done and whether they broke any laws. We think
they did, but maybe they didn't."

Barnett's attorney, John Rodman, was in court and did not
immediately return a phone message.

Violations of state tax law can result in criminal or civil
penalties. Michael Cooke, executive director of the Revenue
Department, said the agency usually does not pursue criminal
sanctions.

She said she did not know how long the tax review might take.

Kristen Hubbell, spokeswoman for the state attorney general's
office, said the office would communicate with the auditor's office
and others to determine whether any follow-up is needed. She
declined further comment.

She said earlier that the audits did not turn up any new
information.

The audit of the university and the camps, run by Barnett's
company High Hopes from 2002 to 2004, raised a number of tax
questions. Auditors said in a report released Monday that vendors
failed to assess an estimated $1,300 in sales taxes on about
$16,900 in camp purchases. The report did not conclude whether
vendors mistook the camp as tax-exempt or whether deception was
involved.

Camp staff told auditors no sales taxes were paid on concession
sales, according to the audit report. Auditors said incomplete
records made it impossible to tell how much sales tax might be
owed.

Some football staff members underreported a total of $68,000 in
income from the camps from 2002 to 2004, the audit said. Coaches
also received tax-deductible gift receipts for $30 monthly payments
toward insurance on courtesy cars that were recorded as donations
to the CU Foundation, the university's private fundraising arm,
rather than payments to offset insurance costs, the audit said.

Barnett told auditors he was working with the Internal Revenue
Service regarding the football camps and income tax reporting, the
audit report said. The IRS has said it could not comment.

The university took control of the camps this past summer.

Barnett was forced to resign from CU last week after an
embarrassing string of three losses and received a $3 million
settlement. Athletic director Mike Bohn has said there was no tie
between the announcement of Barnett's departure and the release of
the audit results.