Owner featured on ‘Bar Rescue’ gets prison
“Bar Rescue” host Jon Taffer has saved more than 800 bars and nightclubs from ruin in his 30-plus years as a consultant. But he couldn’t save Brian Michael Flore, owner of The Arena in downtown Ann Arbor.
Flore, 43, was sentenced Wednesday to two to five years in prison for 120 counts of failure to file taxes, resulting from not paying sales taxes for more than a decade, Attorney General Bill Schuette said in a statement. The Brighton man also was ordered to pay more than $1.5 million in restitution, more than double what the state said he hadn’t paid.
Flore pleaded guilty on July 22, 2015, but was given an 11-month delayed sentence in order to pay toward past due and current sales tax obligations, the statement said. But Flore failed to complete his delayed sentencing requirements and “received two to five years on each of the 120 counts, which will be served concurrently.”
One count of “failure to file taxes” was charged for every month The Arena didn’t pay taxes, the statement said.
Flore was required to pay $8,000 a month on the past due taxes, plus stay current on his sales tax obligations, said his attorney, Andrew Abood. After making an initial payment of $100,000, Flore made seven payments of $8,000 during the delayed sentence. But when he missed a few, “that was the kiss of death,” Abood said.
Had all 11 payments been made, 115 of the 120 counts would have been dismissed and Flore would have been on probation for the other five counts, Abood said.
“It’s too early to tell” if the bar will continue on in Flore’s absence, Abood said. Flore, who Abood said has a wife and two young children, has been looking for investors or for an opportunity to sell the business or the building or both, but was unable to do so.
The Arena was featured on a Season 4 episode of “Bar Rescue” in November 2015. As Detroit News reporter Melody Baetens wrote at the time: “Taffer changed a lot of things about the long-standing corner sports bar, but not the name, which is unusual for ‘Bar Rescue.’ Although they minced words on the show, Flore appeared happy with the visit and renovation, which included a new awning in front, and updated seating and decor. Taffer also put in a beer-dispensing “claw machine” game, but just a few days after the show aired, the game was spotted turned off and unused in the back of the bar.”
One YouTube preview of the episode described Flore as an “intimidating owner” who “chases profits away.” Abood said “I know we live in a reality-TV world, but when you go on that show, it’s usually to the detriment or embarrassment of the owner.”
But according to “Bar Rescue,” The Arena, at 203 E. Washington, grossed $220,000 in food and beverage sales within six weeks after relaunch.
The Michigan Department of Treasury opened an investigation into the bar in 2013 for failure to pay sales taxes for at least 10 years.
An auditor determined that while The Arena charged customers sales tax, it had failed to ever pay any of that to the state. That’s when the Attorney General’s Office got involved. An auditor determined that the bar made more than $9 million in taxable sales, resulting in more than $700,000 in back taxes. Add in a 100 percent penalty for fraud, plus interest, and total restitution ballooned to $1,508,214.
At the time of Taffer’s rescue, Arena regular Jim Walke of Ann Arbor told The News “this wasn’t a failing bar,” it just needed updating, and Flore was content to let the show foot the bill for that.
It had been a “slow four to five months” at The Arena, Abood said, but Flore had hope that business at the sports bar would pick up as football season approached. Instead, Flore was in the custody of the Michigan Department of Corrections.