This is an archived article that was published on sltrib.com in 2015, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Rawlins, Wyo. • On a hot day in June, most of the construction workers building a new high school here went home at 5 p.m. The crew from Phaze Concrete remained.

Four Phaze employees labored another 90 minutes building a wooden frame in a trench.

Phaze's headquarters are 580 miles away in an unmarked office building in Hildale, Utah, home to the Fundamentalist Church of Jesus Christ of Latter-Day Saints.

Phaze, a Salt Lake Tribune investigation has found, is a major financier of the FLDS Church, which believes in polygamy as a spiritual tenet and whose president, Warren Jeffs, is serving a prison sentence of life plus 20 years related to taking underage girls as brides in Texas.

The Tribune probe, based on records and interviews with former employees who also have left the FLDS Church, has found:

• Phaze and the company it merged with at the end of 2013, Jack Daniel's Construction, have paid their employees amounts below minimum wage, former workers say and records show, so they can divert money to the FLDS Church.

• A former worker says he was just a teenager when he drove machinery — despite federal prohibitions against doing so — and two ex-foremen said they had teenagers working on their jobs.

• A former finances supervisor said materials for church building projects were paid for through jobs won by Phaze.

Neither Phaze, Jack Daniel's nor their owners have ever been charged with a crime or a serious regulatory violation related to business practices, records show. They have accumulated about $10,000 in fines for safety violations through the years, but Occupational Safety and Health Administration records list no accidents.

In a March interview, Dan Jessop, 31, one of the founders of Jack Daniel's Construction who said he became a general manager with Phaze after the merger, denied anything illegal had occurred within the companies. He said Phaze had "40 open contracts" spanning from Mississippi to California.

"We do good work," he said. "We do a lot of good contracts."

Jessop denied that Jack Daniel's or Phaze, at least since the merger, has given money directly to the church, though he acknowledged paying a personal tithing.

Asked whether anyone should draw a link to Phaze and Jack Daniel's and the sex abuse within the FLDS, Jessop replied: "Of course not."

In response to questions from The Tribune, an attorney representing the companies, Blake Hamilton, replied with a letter saying they are audited yearly to ensure their books are accurate and comply with tax laws.

Hamilton said a human-resources expert found the firms pay their employees "more than most Utah companies pay their employees doing this type of work." As for teen workers, Hamilton said the companies do not employ young workers in violation of the law or in a way which "places these individuals at risk."

One ledger seized by Texas authorities in 2008 shows the construction operations of Phaze founder John R. Beagley Sr., known as "Johnny," contributing $100,000 a month to Texas' Yearning for Zion Ranch, where Jeffs committed the sex crimes for which he was convicted.

In 2013, Jack Daniel's wrote a $401,888 check to Schleicher County, Texas, to pay taxes on the ranch, according to the county appraisal district.

The men managing and working for Phaze and Jack Daniel's have reasons to support the FLDS Church. Since the faith's founding, followers have practiced a form of communal living in which they share asset ownership. Followers also believe their salvation is tied to plural marriage and a man's ability to hold the priesthood — authority from God. Jeffs and his closest brothers have the ability to strip men of their priesthood titles, remove their families, evict them from the FLDS and forbid kin from speaking to them.

One of Phaze's former employees is Thomas Jeffs, a nephew of the imprisoned leader and the eldest son of Lyle Jeffs, the bishop of Hildale and adjoining Colorado City, Ariz., who is running the sect's day-to-day operations. Thomas Jeffs said he worked for Phaze from 2011 through 2013.

"Father told me at that time Phaze was the No. 1 donator to the church," Thomas Jeffs told The Tribune.

Thomas Jeffs said when he was working on a WinCo grocery store in McKinney, Texas, he shared a motel room with Paul Beagley. One night, Beagley told him that he had received a phone call from Lyle Jeffs saying the FLDS needed $400,000 from Phaze to pay construction and legal bills that had accumulated from the law enforcement raid on the Texas ranch.

As of Wednesday, the IRS had liens against Phaze totaling $703,888, according to the recorder's office in Utah's Washington County. In June, Utah filed a $55,356 tax lien against Phaze.

'Priesthood and Zion Eternally' • Hildale and Colorado City are collectively known as Short Creek. On a Sunday evening in 2011, Davis Johnson and another Phaze Concrete worker loaded into a pickup, left Short Creek and drove 550 miles through the night to Santa Fe, N.M.

There, Johnson and his partner finished some work at a new Wal-Mart where Phaze had a subcontract. They finished work by 7 a.m., returned some rental equipment, got back in the truck and drove another 200 miles to Truth or Consequences, N.M., where Phaze was working on Spaceport America.

"I was awake for 36 hours," Johnson said in an interview.

Long hours and hard work are Phaze's hallmarks.

"Let's put it this way: If you need the manpower, they've got it," said Mike Martin, a project manager at R&O Construction, a general contractor in Ogden. He last worked with Phaze when it was a subcontractor building a Fred Meyer store in Portland, Ore., last year. "They do a good job. One thing about Phaze Concrete, on the Fred Meyer we did, they worked a half a day on Christmas Day."

Thomas Jeffs recalled that many of the jobs he worked had two shifts, with a night crew preparing framing and reinforcing bars for a day crew that would pour and level the concrete.

Jacob Rohbock, who was 15 years old in 2010 when he went to work for Phaze, said he would be at jobs for 13 hours a day.

"We were working our asses off," he said. "We were at the job longer than we were at our house."

Phaze and Jack Daniels do not own a quarry or concrete-making equipment. They buy concrete for each job from an area vendor, according to interviews. Much of the earth-moving equipment Phaze uses is leased.

That means the only way for a company such as Phaze to make money is to pour concrete faster and cheaper than its competitors, explained Peter Philips, a University of Utah economics professor who studies the construction industry.

"Their savings," Philips said, "can only be in the workers."

Economics hasn't been the only driver behind Phaze's labor practices.

Phaze is a loose acronym for "Priesthood and Zion Eternally," according to Johnson and former Phaze finances supervisor Ben Thomas.

The company was incorporated in Utah in 2003 as John Beagley & Sons Inc. Johnny Beagley was listed as the company president with sons Paul and John "Rodger" Beagley Jr. as officers. The name was changed to Phaze in 2006.

Johnson said in the almost five years he worked at Phaze, the company held two employee meetings in Hildale. At both, Johnson recalled, Johnny Beagley, now 70, stood up and told everyone Phaze was "100 percent dedicated to building up the priesthood."

Anyone who didn't share that mission could leave, Johnson said.

Johnson believed in the company and its cause and accepted just a portion of what he could have made from another construction firm.

"It was our belief to build up a kingdom for God," said Johnson, now 39 years old.

He said he only asked for what he needed — enough money to pay the minimum on his credit cards and a car payment and auto insurance.

A lot of FLDS workers made similar sacrifices.

"A guy would work for 15 hours and get paid for eight of it," said Thomas, who worked in Phaze's offices in Hildale and kept the finances of some of the company's jobs. Johnny Beagley, is Thomas' father-in-law.

Consecration in writing • Thomas, who left Phaze and the FLDS Church in April 2013, said Phaze kept two sets of records. The first set was what it reported to general contractors and the government. The second set was what it reported to the church.

FLDS leaders, Thomas said, wanted to know how much the employees were working so they could consider their labor a donation to the church.

Thomas provided The Tribune with a spreadsheet of Phaze's church-donation records from January 2012. The spreadsheet shows how many hours each employee worked, including some women cooking and cleaning for the construction crews and working in offices, his or her rate of pay — as little as $7.50 an hour for some of the construction workers, just above the federal minimum wage of $7.25 — and how many hours he or she worked each week. The rate did not increase if the worker exceeded eight hours a day or 40 in a week.

On a separate spreadsheet was the amount of money workers donated to the church. It shows in the third week of January, Rohbock, who as a then-17-year-old earning $8.50 an hour worked 51.5 hours on a motel in SeaTac, Wash., donated $218.88 — half his paycheck.

Twenty other workers laboring at Phaze jobs Thomas was monitoring also donated that week — for a total of $9,649.21 to the FLDS, the records show.

Thomas also provided a copy of Phaze's "Consecration Voucher Form." Thomas said Phaze created it to give to employees so they could submit it to the church. That way, the church knew how much money each worker donated.

Phaze has been known to sometimes hire area workers who are not FLDS Church members. When it was pouring concrete for an apartment complex in Lincoln, Neb., last year, for example, Phaze hired college students on their summer break to help augment their FLDS workforce.

But Phaze has relied on FLDS workers. They tend to work harder and more efficiently, Johnson said.

"It's hard to get a person outside of the community to understand," Johnson explained, "because [outside workers] have their set ways, their set pace."

Government records and websites maintained by Phaze and Jack Daniel's show how much the companies have earned through the years.

For the Spaceport America project, Phaze's website listed the concrete it poured there and the related work to be worth $2.4 million.

Jack Daniel's website says it completed jobs for a Wal-Mart in El Paso, Texas, and a Sam's Club in Pearland, Texas, that each paid the company more than $3 million.

Accounting records Jack Daniel's submitted to the Arizona Registrar of Contractors claims the company had $10.8 million in revenue in 2012, though Jack Daniel's said the net income was $310,356.

Jack Daniel's accountant was LeRoy S. Jeffs, a full brother to Warren Jeffs.

To lodge FLDS workers near a job site, Phaze rents houses and sends women and teenage girls there to cook and clean for them.

Johnson said his wife was one such woman. She and their two children followed him to various cities, lived in the rented house with Johnson and the other workers and did the cooking. She even delivered lunches to the job sites. Johnson paid for all the meals. In some cases, the other workers paid him back. Other times, the company reimbursed him, though Johnson said he never got all the money back.

Hamilton's letter said employees providing meals and housekeeping "receive actual payments through payroll."

Johnson said he and the housemates studied FLDS doctrine together, too. Johnson said in the mornings everyone read a sermon from Leroy S. Johnson, the late FLDS prophet for whom the meetinghouse in Colorado City is named. After dinner, everyone in the house read a lesson from Rulon Jeffs — Warren and Lyle Jeffs' father.

Shuffling the books • Jack Daniel's Construction was founded in Texas in 2009. The company's name has nothing to do with whiskey. It's named for brothers Jackson and Dan Jessop.

Their father, Merril Jessop, was the bishop of the Texas ranch. He served a prison sentence in Texas for officiating the marriage of a 12-year-old girl to Warren Jeffs.

Matthew Barlow, who worked for Jack Daniel's for about five years, including time as a foreman, said the company went through stretches when it paid him only a few hundred dollars at a time or not at all.

While building a new Wal-Mart in Vista, Calif., in 2010, Barlow said, a Jack Daniel's executive came to the workers. Barlow said they were told the church had accumulated debts in Texas and that the sect needed them to go with less pay and work harder so the company could generate more money.

The employees agreed.

"But we didn't know we'd have to pay all our damn money," Barlow said in an interview.

Workers may donate to churches, but it must be done voluntarily and through proper documentation, according to IRS guidelines. Federal regulations also allow employers to reduce paychecks only in certain circumstances, such as part of an agreed-upon salary plan or because someone fails to appear for work.

A lot of Jack Daniel's work was in Texas. While building dormitories for Goodfellow Air Force Base in San Angelo in 2010, the Air Force and the general contractor found Jack Daniel's was improperly adding employees' overtime when it was submitting their payroll records, according to a Labor Department report. Jack Daniel's was told to comply with reporting requirements, but no further action was taken, according to the report.

In Texas, what free time employees had was often spent working construction on the YFZ ranch, Barlow said. He said building supplies and equipment for the ranch often were paid for through Jack Daniel's accounts — much like how the taxes were.

Back at Phaze, Thomas said, he sometimes would buy building materials for the ranch or the compound Warren Jeffs ordered built for himself in Hildale in 2010 and bill it to a job they were working elsewhere.

"If my job was really running in the black, and the ranch needed rebar [reinforcing steel bar]," Thomas said. "I would code it to my job."

It was a way, he said, for Phaze to donate to the church and make jobs look less profitable, which meant fewer taxes.

Young and the nest-less • In 2012, Johnson arrived at the construction site for a new Wal-Mart in Gardnerville, Nev. He counted five boys under age 18 working on the job.

"I got there and said, 'What are we doing?' " Johnson recalled. " 'Is this a day care center.' "

Barlow said he saw kids as young as 13 working on some jobs. He said he would try to give teens the least-dangerous tasks, but they otherwise worked just like the men.

Rohbock, who started with Phaze when he was 15, said he was only an occasional worker for the company. One of his older brothers was Phaze foreman and when the company needed extra workers, Rohbock would get a call.

He drove forklifts, skid loaders, water trucks and a backhoe. All can be considered heavy equipment requiring training before anyone is allowed to operate them on a job site.

Rohbock said he had no formal training. He remembers driving a backhoe for the first time while building a Wal-Mart in Santa Fe, N.M.

"For the most part, I just figured it out," Rohbock said. "I watched a lot of other people do it."

Teens working a job is not necessarily illegal. The rules vary by state and sometimes, depending on the job, by how many hours they work.

But people under age 18 may not work in any job considered hazardous, and on its Web page discussing youth employment, the Labor Department lists "excavation ... and operating many types of power-driven equipment" as two jobs considered hazardous.

Even when the teen is allowed to work, the employer would have to follow the same wage and overtime rules it would for adults.

Rohbock said a job superintendent ­— the person who oversees the subcontractors and the day-to-day work at the construction site — occasionally would ask him how old he was. Rohbock said he answered as he had been trained to do. He told them he was 18.

Rohbock said he went to work for Phaze because he wanted to get out of Hildale and Colorado City. His father was expelled from the FLDS and forced to leave his two wives and his children. Rohbock, who said he has 12 full siblings but doesn't know how many half siblings, had been living with his mother.

Other boys were sent to work to keep them out of trouble, Johnson said.

In recent years, the FLDS Church has been separating boys from their mothers once the youths reach puberty or because they violated one of the sect's rigid rules against watching movies or listening to commercial music, according to people who have left the sect. Schooling also stops near that age.

The result has been boys with no steady place to live and no supervision. Sending boys to work for a company such as Phaze became a way to keep them off the street or to force them to repent after being caught doing something they weren't' supposed to be doing, Johnson said.

Neither Phaze nor Jack Daniel's has ever been cited for improperly employing underage workers. The Labor Department report shows that agency investigated whether Jack Daniel's had 16- and 17-year-olds operating machinery while building roads and overpasses for the Texas Department of Transportation. The department was unable to substantiate the allegations.

Johnson said Phaze and the church eventually sent away the teens working at the Gardnerville Wal-Mart, though he isn't sure where. He assumes Phaze and the church became wary of the teen workers as the Labor Department investigated other FLDS-related businesses for the practice, including a workforce company accused of using children in a 2012 pecan harvest in Hurricane.

Johnson cautioned against assuming all the teens at Phaze were unfit to work. While some weren't mature enough, other teens were good workers. Johnson recalled a 17-year-old who drove a water truck.

"He was alert and attentive, and he understood what needed to be done," Johnson said. "It's kind of sad that society don't allow that kind of person to work."

Phaze fans • Phaze has allies outside of Hildale and Colorado City, including Faruq Ramzanalli, the co-owner of the lodging company Hotel Concepts. Phaze has poured concrete at four of his motels in the Seattle area. Ramzanalli said he has gotten to know the Beagleys.

"Not only are they hardworking and knowledgeable," Ramzanalli said, "they support their community. I wish I could have those [Beagley] boys next to me."

Ramzanalli said he's not aware of any underage workers or other problems with Phaze. He was unaware of the company's affiliation with the FLDS or polygamy, just that it was headquartered in a small Utah town.

Although they worked hard without much pay on behalf of a church they no longer follow, some former Phaze and Jack Daniel's employees have fond memories of their time there.

Barlow said he learned a lot about construction from Jack Daniel's and worked with good people. He sees Jack and Dan Jessop as two men trying to grow a business while being loyal to their faith. When Barlow left the company, the Jessops tried to compensate him for the wages he was owed by giving Barlow some tools and letting him buy a used company pickup truck.

"They treated me fair," Barlow said, "as far as Jack and Dan were concerned."

Donations • In Rawlins in June, the Phaze crew was cleaning up to finish work for the night. Outside the construction site's fence was the football stadium bearing the high school's nickname: the Outlaws.

The crew's foreman, Rulon Allred, said the earthwork and concrete pours for the new high school will take another year. Phaze also had some work still to do across town on a Fairfield Inn & Suites. Across the street from that motel is a Wal-Mart for which Phaze poured the concrete.

"This is a good company to work for," Allred said.

Allred said he has worked for Phaze for 4½ years. Allred's name appears in the Phaze payroll and donation records Thomas provided.

In the first week of 2012, according to the records, Allred worked 73 hours. He was paid $200. The rest of his check went to the church.

After work that day in Rawlins, the Phaze crew drove to a rental house, where three females in their teens or early 20s were staying. The three wore prairie dresses — the required attire of FLDS girls and women.

Twitter: @natecarlisle —

COMING MONDAY

Wal-Mart contracts helping polygamous companies expand

Phaze Concrete has been a subcontractor on 70 Wal-Mart stores constructed or remodeled since the start of 2003. › See the story at sltrib.com, or read it in Monday's Salt Lake Tribune

comments powered by Disqus