The decision to locate in downtown Springfield was heralded as sign of resurgence for the local economy by community leaders. But the business hasn’t hit job creation projections and with its products down, it’s not clear what its future is.
FROM 2016: EF Hutton move to Springfield ‘catalytic moment’
The company said earlier this year it was in the process of restructuring debt and raising new capital. Last week several of its websites went dark, including EFHutton.com and Meggalife.com. The main phone line rings to a busy tone.
CEO Chris Daniels also couldn’t be reached for comment.
City officials have concerns about the company’s situation, Assistant City Manager Tom Franzen said.
“We’ve been hopeful that they would get their footing,” he said. “We have no information from the company about their current status.”
HUTN Inc. is delinquent on numerous debts to the city, county and state.
The company owes Clark County more than $67,000 in property taxes overall, including $58,857.76 on EF Hutton Tower, one of the most prominent buildings in downtown. It could face foreclosure if it remains unpaid.
“These delinquent taxes consist of second-half 2017 taxes payable in July 2018, penalty, Dec. 1 interest, first half 2018 real estate taxes due Feb. 15, 2019, and penalty,” Clark County Treasurer Stephen Metzger said in an email.
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The company also owns the State Theater, 19 S. Fountain Ave., and owes more than $8,500 in taxes on that property, Metzger said.
“If taxes remain delinquent and unpaid, the county auditor in December 2019 will certify them delinquent to the county prosecutor, who could then start a tax foreclosure proceeding in early 2021,” Metzger said.
The Ohio Attorney General’s collections department also has issued a lien against the company for more than $600 owed to the Ohio Department of Job and Family Services for unemployment taxes.
The company is behind on water and sewer bills at both of its Springfield properties, according to city Utility Billing Manager Andrew Luttrell.
The Springfield News-Sun reported last week that the city also has held back an incentive payment while seeking more information on job creation from the firm.
The financial firm pledged to create 415 jobs when it first moved to town. An annual reporting form submitted to the city earlier this year shows 32 employees hired in 2018 and left blank how many full-time workers are currently employed.
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The same form reported HUTN Inc. spent about $131,00 on equipment in 2018 and $220,000 on the building itself.
City data shows HUTN Inc. got around $14,600 from the city in 2018 for workers it hired in 2017.
Multiple attempts to reach Daniels last week were unsuccessful.
Daniels previously said the company is open for business. A news release posted earlier this year said the company was working on a strategy to swap debt for equity.
HUTN Inc. subsidiaries include EF Hutton Inc. and Megga Inc.
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Meggalife is a collection of social media apps the company launched in 2017 on which users could accrue points to be deposited in a retirement account and be redeemed at age 68. None of the Megga websites, including Meggamigos.com, were working last week. Apps could still be downloaded but didn’t load properly.
HUTN Inc. said in a financial filing in December that it was being investigated by the Securities and Exchange Commission, focusing on the company’s involvement with digital currency. At that time Daniels said he was confident there would be no violations found.
An SEC spokesman said last week they don’t comment on, confirm or deny the existence of ongoing investigations.
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The last quarterly financial report also showed the company reported a net loss from operations of about $1.9 million for the quarter that ended Sept. 30, and a total loss from operations of $6 million for the first nine months of 2018.
Horton Hobbs, vice president of economic development for he Chamber of Greater Springfield, said he remains optimistic HUTN Inc. can turn things around.
“They are in a mode where they are trying to recapitalize,” he said. “We certainly want them to be very successful.”
The chamber has offered to help find possible tenants for EF Hutton Tower, Hobbs said.
“At this point (HUTN) have not expressed an interest in bringing in more tenants,” he said. “The community is trying to work with them.”
The Springfield News-Sun has closely tracked the development of HUTN INC. and its subsidiaries since the company first announced its move to downtown Springfield in 2016, including stories examining its possible impact on downtown and its new products.