would leaving out this shim cause the plastic ring to be ripped? if so, where can i get the shim to buy? no one seems to know where.

i have seen starters for hysters and yales both come as 9 or 11 tooth starters, Yale actually had both for their Mazda engine. As long as the teeth match up to the ring gear teeth and you do not get any grinding when turning the engine over then its good to go.
If you do get a binding like the starter is working too hard then yes , to answer the question about the shimming. All GM starters that mount this way require a shim if the Bendix teeth set too deep into the teeth of the ring gear.
If you want to know for sure how the bendix is running with the flywheel ring gear just put some prussian blue on the teeth and run it around a couple times. Remove the starter and look at the pattern.

Can anyone say if this starter has a spacer/shim that needs to be installed between the starter and the block? i keep tearing the plastic ring gear every 3 weeks or so.

Hey Justin,
Thanks, there was an ignition delay originally added to try and compensate for this problem. I belive it was supposed to help the "kickback" issue with the Hyster. I don't fully understand the reason for it - why do you have to fill the induction system with extra air/fuel to prevent kickback?
The ring gear has 153 teeth and the original starter pinion has 11. The 11 tooth pinion is also larger in diameter. With the ignition delay, the starter will have to crank longer, causing the missmatched gears to stress even longer before the engine fires.
You're right, the starter bolts are vertical, just like every GM Chev small block. Which gives this starter the infamous GM whine when the teeth are not mating properly.
I believe the ring gear was replaced with an automotive type as this same block that is used in Chevettes-which use the 9 tooth drive starters. Thats why it would be nice to know how many teeth on the original Hyster ring gear.
I would also like to know more about why this ignition delay was engineered. Thanks for replying Justin.

make sure the ignition delay is working properly
those GMs have an issue with the starter if that system was bypassed and the ign turns on with the s term goin hot
youll wreck starters and ring gears

the starter mounts to the block
it looks like a ford starter nose with a chevy field housing and solenoid

the starter bolts go in vertically not horizontally like most others in forklifts

you should get about 5 - 10 revolutions before power is sent to the ignition coil