Five Prestonsburg businesses owe the Prestonsburg Tourism more than $90,000 in delinquent restaurant taxes.
The tourism commission discussed the delinquencies during its regular meeting on Sept. 11, but officials would not provide specific information about the names of the businesses or the amount of funds each of them owe the agency at that meeting.
The city of Prestonsburg, which collects these taxes for Prestonsburg Tourism, provided the information Thursday in response to an open records request filed on Sept. 12.
Prestonsburg Tourism is funded through a transient room tax on hotels in the city as well as a three-percent restaurant tax from businesses that serve food in the city.
Four restaurants have been collecting this tax from customers, officials said, but they have not forwarded the payment of this restaurant tax to the city, as required.
The open records response shows that the former owner of Papa Johns owes about $47,000, the new owner of Papa Johns owes more than $10,000, Giovanni’s owes more than $21,200, Sandy’s owes nearly $12,500 and Sam’s Hot Dog Stand owes an “unknown” amount because the company has never filed tax documents with the city.
“So, there’s four restaurants, technically, one restaurant that had two different owners, both have their own separate set of issues,” Prestonsburg Comptroller Matt Ellis told the tourism commission this month. “So, the total of the outstanding taxes collected and not paid were $90,268.92. Everything’s been documented very well. We turned it over to our city attorney and she has already notified all of our business owners, past and present, about their debt and what they’re expected to do.”
Tourism Director Samantha West asked Ellis to clarify that these businesses collected these taxes from customers.
“Yes,” he responded. “They collect it from customers and pass it on.”
“So, they got it from the customers, then it stopped,” tourism commission Chairman Jim Ousley said.
“Precisely,” Ellis said.
Ousley said two business owners contacted him directly about the delinquencies and he asked them to show up at the meeting, but they were not in attendance.
Prestonsburg Tourism’s budget is $870,000, and the majority of those funds come from the transient room tax and the restaurant tax. It splits its tax proceeds with the Mountain Arts Center ($226,000), Prestonsburg Parks Commission ($287,000) and StoneCrest Golf Course ($69,600).
Attempts to reach the previous and current owners of Papa Johns, which is now closed, were unsuccessful, as were attempts to reach the owners of Sam’s Hot Dog Stand prior to print deadline.
Bobby Blackburn, owner of Giovanni’s, and BJ Blackburn, the restaurant’s manager, did not want to comment publicly about that company’s reported tax delinquency.
Sandy Smith, owner of Sandy’s Restaurant and Catering also offered no comment about the issue, but noted she is working on a payment plan with the city.