A handwritten sign at the entrance to the Firefly Club apologizes for the closing. (Photo by the writer.)

The Firefly Club, a jazz and blues nightclub at 637 S. Main, was closed down by the state last night and its assets seized for unpaid sales taxes. Owner Susan Chastain told The Chronicle that her bank account and other assets have been frozen as well, because she was unable to make full payments to the state over the past two months on a debt of $120,000 – an amount in arrears for assessed sales tax dating back several years.

“We’ve always struggled,” Chastain said. It’s historically been difficult for blues and jazz clubs, she added, but the economic downturn has made it even more difficult to keep up.

Chastain opened the Firefly nine years ago at 209 S. Ashley, where the Bird of Paradise, a now defunct jazz club, had been located. Recordkeeping problems – dating back to the club’s opening – caused the state to assess the Firefly’s sales tax, plus penalites and interest, at about $160,000 several years ago. Chastain said that about three years ago her current accountant negotiated a payment plan, and she started sending the state $2,000 each month to put toward the unpaid sales tax.

The move to their current location in 2007 was a big setback for the business, Chastain said, and last winter was especially difficult. She tried to get monthly payments lowered to $1,000 but was only able to negotiate it down to $1,500 per month through May, when the amount bumped back up to $2,000.

Chastain said she hasn’t been able to pay the full amount for June and July, but that she sent in $1,500 each of those months. She was hoping that a big event planned for Saturday – a 50th birthday party for sax player Tim Ries – would bring in enough money to help pay that bill.

But last night, just before the club was to open, she got a call telling her that the field agent for the state treasury, Barb Weatherbee, and two Ann Arbor police officers had arrived at the club and were closing it down. “It was totally mortifying,” she said. She has 10 days in which to come up with the full amount owed. If she doesn’t, the state will auction off her assets – including a grand piano and several posters signed by musicians who’ve played there.

Calls left for Weatherbee and a spokesman at the treasury department haven’t yet been returned. [Update: Reached late Friday afternoon, state Treasury spokesman Caleb Buhs said he couldn't comment on this specific case, but said that seizures of this kind take place only "after many, many months of working with the taxpayer." He said he couldn't disclose the state's audit procedures or what guidelines determine when property is seized – that information could allow taxpayers to work around the system, he said. 

After property is seized, the taxpayer no longer has the option of a payment plan. The entire amount must be paid before the auction date in order to retrieve the property. The auction will occur after a minimum of 10 days from the date of seizure, but it could be longer, Buhs said – the taxpayer has until the date of the auction to make payment. The auction will happen on site at the Firefly Club – when the date is scheduled, it will be posted on the building and in the local newspaper. Buhs said now that the Ann Arbor News is no longer publishing, he's not sure where they'll be noticing the auction – possibly in the Detroit Free Press.] 

According to the city of Ann Arbor treasurer’s office, the club also owes almost $2,600 in business personal property taxes from 2007, 2008 and 2009.

Chastain said she’s trying to seek support from whatever corner she can, such as contacting state Rep. Rebekah Warren of Ann Arbor, to see if there’s anything she can do. But the state is desperate for money, Chastain said, so she isn’t optimistic that they’ll cut her a break.

In addition to its stable of regular performers – including the Paul Keller Orchestra, which features Chastain as the lead vocalist – the club has also been a spot for celebrations. In the recent Democratic primary for Ann Arbor city council, for example, councilmember Mike Anglin held his post-election party at the Firefly.

The Ann Arbor School for the Performing Arts, located in the same building, has benefited from its neighbor, according to Stephanie Weaver, the school’s executive director. Students are allowed to sit in and play with many of the professional musicians who perform at the club. “There’s no comparison to that kind of education,” Weaver said.

“This is probably the last really great presenter of this dying art form around this area,” she said. “Performances are so high quality there.”

Chastain said she’s fought hard for almost 10 years to keep the club open. Even if she declares bankruptcy, she said she’ll still face the tax debt: “Taxes never go away.”

A notice posted on the entrance to the Firefly Club.