PRESTONSBURG — Floyd County Attorney Keith Bartley said the state “ought to be ashamed of itself” for inking a deal for the payment of delinquent taxes owed by companies controlled by the family of West Virginia Governor Jim Justice.
The Kentucky Finance and Administration Cabinet and its Department of Revenue announced on June 10 that it has reached a “long-awaited” settlement agreement for delinquent taxes owed by companies controlled Justice’s family, Kentucky Fuels, Inc., Sequoia Energy LLC and A&G Coal Inc.
Those companies agreed to pay delinquent taxes owed in Harlan, Knott, Magoffin and Pike counties, a press release from the Finance and Administration Cabinet said. The agency did not report the total paid, the counties received checks totaling nearly $1.2 million last week, the Lexington Herald-Leader reported, and Justice’s companies have “pledged to pay an equal amount over the next six months.”
The settlement agreement also released Kentucky Fuel from suspensions on its mining license, the press release said.
“I am happy that we were able to bring much needed tax revenue to these counties whose budgets have been tightened because of decreasing coal severance revenues and other expenses,” Finance Cabinet Secretary William M. Landrum III said in the press release. “This settlement means the state and these counties no longer have to spend time, money and other resources on lawsuits that could take many years with no guarantee that the taxes would be paid.”
Bartley opposes the settlement agreement, reporting on Tuesday that he is preparing to sue Justice’s companies for money they owe Floyd County.
“Jim Justice’s companies are notorious for not paying their bills, and that includes tax bills that they owe in virtually every coal-producing county in Eastern Kentucky,” Bartley said.
He said he opposes the settlement agreement because he said it included “a 100 percent waiver of all interest and penalties.”
“Floyd County was not involved in those negotiations because, at least in part, I made it very clear from the very beginning that I would never, under any circumstances, agree to waive 100 percent of all interest and penalties for Justice’s companies,” Bartley said. “I think it’s not fair, not right, to give huge tax breaks to a West Virginia billionaire while at the same time taxing our people in Floyd County, while at the same time struggling to survive at all governmental levels in Floyd County — fiscal court, libraries, fire departments, senior citizen centers, boards of education. We all have to struggle because people like Justice and his companies don’t pay their bills. And then, when the heat comes, what do they do? They want a reduction.”
He said he believes that some counties agreed for the settlement because “their financial circumstances were such that they didn’t have a choice but just take what they could get.” “The state of Kentucky ought to be ashamed of itself for waiving the amounts of taxes owed to it by Justice’s company,” Bartley said. “The fact that he’s the governor of West Virginia probably weighed heavily on those decisions. It means absolutely nothing to me.”
Kentucky Fuels owes Floyd County more than $600,000, Bartley said, and he’s been trying to collect that bill since 2013. He said the company agreed to pay the county $50,000 monthly to repay the delinquent taxes owed, but then stopped paying it after making several payments.
“That’s the problem with Justice’s companies,” Bartley said. “They owe us delinquent taxes from 2013 forward. Well, they want to pay a 2013 tax bill in 2019, but waive that six years’ worth of interest and penalties that accrued. So, it’s like giving them a free loan. Well, a lot of counties agreed to that, and the state of Kentucky agreed to that. But Keith Bartley won’t agree to that.”
Bartley said he is now compiling to total amount owed by Justice’s companies in delinquent property taxes, delinquent coal severance taxes and other taxes and fees in preparation of filing a lawsuit.
Bartley said Floyd County was not “included in the discussions” for this settlement agreement. He said he learned of it after receiving a call from a Lexington Herald reporter.
“So, then I began to inquire, and, of course, since then their attorney has offered to pay Floyd County if we will agree to waive 100 percent of all interest and penalties, and I have said absolutely not,” Bartley said.
He said Justice’s companies probably owe “hundreds of thousands” in interest and penalties in addition to delinquent taxes owed to the county.
He said he’d be “willing to work” with the company on the interest and penalties as he does with other taxpayers.
“But am I willing to say, here’s a 100 percent waiver? No. Absolutely not,” Bartley said. “I refuse and we’ll just let the courts resolve it. I just can’t imagine why a West Virginia billionaire would even need a waiver of interest of penalties, or any billionaire for that matter.”