A West Virginia company with ties to West Virginia Gov. Jim Justice agreed to pay $400,000 for delinquent taxes owed to Floyd County.
Floyd County Attorney Keith Bartley reported that Kentucky Fuel, operated by the family of Gov. Jim Justice, agreed to pay $400,000 to Floyd County for delinquent property taxes and unmined coal taxes owed between 2013 and 2018.
“That’s to be paid, $200,000 up front, which we have already received, and the balance will be paid over six monthly payments of $33,333 … Down to the very penny,” Bartley said. “That will be the largest, assuming, you know, they follow through on the agreement, that will be the largest interest and penalty payment, we believe, in the history of Floyd County.”
Bartley said officials didn’t want to announce the agreement until after the $200,000 check received earlier this month cleared the bank.
In June, the Kentucky Finance and Administration Cabinet announced that it had reached a “long-awaited” settlement for delinquent taxes owed by companies controlled by Justice’s family in Harlan, Knott, Magoffin and Pike counties.
Bartley opposed that settlement, however, because he said it waived all interest and penalties on the delinquent tax bills.
Bartley mailed a notice to Kentucky Fuel Corporation and its president James C. Justice on June 12, informing officials that Floyd County intended to force a lien for about $670,300 that was owed to Floyd County.
The notice gave the company 45 days to pay the delinquency to avert a lawsuit and additional penalties, interest and fees that would be owed if a lawsuit was filed.
“I’m always happy if we can resolve one that everybody’s agreeable with,” Bartley said. “And in this case, I discussed it with the people who were going to get the largest portion of that settlement before we agreed — the superintendent of schools, the sheriff, the county clerk, the county judge. I discussed it with all of them. They were all in agreement, they thought it was a great deal because, quite frankly, they were all concerned because of the rash of coal company bankruptcies. They were concerned that if we didn’t get a deal done soon, if this company went bankrupt, we would ultimately get zero.”
Bartley said Floyd County “would have come up $87,000 shorter” if it was part of the state’s repayment negotiation with companies affiliated with Justice in June.
“The state of Kentucky and multiple counties agreed to waive 100 percent of all interest and penalties that they were due, which was several millions of dollars, and I just refused to do that. ” Bartley said. “So, in this case, we ended up getting $87,000 — assuming they follow through on their payments, we get $87,000 worth of interest and penalties, which on a $313,000-face-value bill, that’s about, if my math’s right, that’s about 35 percent or so.”
This isn’t the first time Floyd County has reached an agreement with Kentucky Fuel to pay delinquent bills owed. Bartley said dealing with Justice’s companies are “like pulling teeth.”
“We had an agreement with them a few years ago, and they did make payments monthly,” Bartley said. “They paid $50,000 a month, multiple times, multiple months, but then they stopped. So, yes, that was a concern as we made this agreement. So, there was language in this agreement that essentially says if they fail to make their payments as agreed, then we get to go after the whole amount.”
He said he is thankful Floyd County wasn’t part of the negotiations in June.
“Everything is contingent, obviously, on them following through on that payment plan, but in the end, like I said, we will be the one county that got — assuming payments are made, as agreed — we’ll be the one county that will receive substantial interest and penalties, even with the state of Kentucky didn’t,” he said. “I said from the very beginning, I couldn’t believe the state of Kentucky agreed to waive 100 percent of its interest and penalties. I still don’t understand that decision, other than to say, in my opinion, it probably wouldn’t have been done if it wasn’t Jim Justice, the governor of West Virginia.”