Kentucky county to sue coal company linked to W.Va. Gov. Justice to collect unpaid taxes

‘We’re all getting shorted money.’ Sheriff wants Jim Justice to pay his taxes.

Knott County Sheriff Dale Richardson on the problem of delinquent taxes owed by a company linked to West Virginia Gov. Jim Justice.
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Knott County Sheriff Dale Richardson on the problem of delinquent taxes owed by a company linked to West Virginia Gov. Jim Justice.

A county attorney in Eastern Kentucky has provided notice of his intent to sue a coal company once controlled by West Virginia Gov. Jim Justice to collect $670,000 in delinquent taxes.

The notice from Floyd County Attorney Keith Bartley was dated Wednesday.

The law requires a 45-day notice before filing a lawsuit in an effort to collect delinquent taxes. That’s the notice Bartley sent to Kentucky Fuel Corporation.

The company has delinquent taxes on property and unmined coal reserves dating to 2013, according to the letter.

The amount of the original tax bills totaled $313,125.

However, Kentucky Fuel now owes a total of $670,274 in Floyd County because of penalties and interest that have piled up as a result of the payments being late, according to Bartley’s notice.

Justice, a billionaire who who was elected in 2016 as a Democrat but later announced a switch to Republican at a rally with President Donald Trump, controlled Kentucky Fuel during much of the time covered in the tax bills.

Justice switched control of Kentucky Fuel and other coal companies to his son, Jay, and daughter Jill in 2017, according to federal records.

Justice-family companies had owed millions in delinquent taxes to the state and five Eastern Kentucky counties until recently, when Jay Justice and the state worked out a payment agreement.

Jim Justice
Companies controlled by West Virginia Gov. Jim Justice and his family have faced millions in back taxes to five Eastern Kentucky counties. Tyler Evert Associated Press File Photo

The companies paid the state $1.46 million late last month under the plan. The state waived penalties and interest on its part of the debt as part of the deal, and released suspensions on Kentucky Fuel’s mining licenses that the Department of Revenue had sought because the delinquent taxes.

County attorneys in Pike, Harlan, Knott and Magoffin counties also agreed to concessions under the plan in order to collect back taxes from Justice companies.

Justice sent checks totaling $1.2 million to the four counties last week, with a pledge to pay that much more before the end of the year.

However, Floyd County was not included in the settlement deal.

In considering the agreement, state revenue officials had looked at counties where Kentucky Fuel had active mine licenses, and Floyd County was not on the list.

However, Bartley said he had told an attorney for Kentucky Fuel more than once about the company’s unpaid taxes, so felt sure the company knew about the debt.

An attorney for Justice, Richard A. Getty, said he offered Floyd County the same deal the state and several other counties accepted — that the company would pay the full, initial amount of the bills in return for having penalties and interest waived.

Bartley said the county offices and services would have to give up nearly $360,000 worth of penalties and interest on Kentucky Fuel’s tax debt under that deal.

He said he couldn’t agree to do that.

Other local officials support his decision not to waive such a substantial amount of money, Bartley said.

Sheriff John Hunt posted a newspaper story on his Facebook page thanking Bartley for refusing the deal.

Bartley said the sheriff’s office reported that 92 percent of the taxpayers in Floyd County pay their property taxes on time.

“It’s kind of unfair to the average person as a taxpayer in Floyd County,” Bartley said of giving a big break on delinquent taxes to a company affiliated with a billionaire.

Getty said Thursday that he hadn’t yet seen the notice of intent to sue Kentucky Fuel.

However, he said the company has no assets or operations remaining in Kentucky, so a judgment against the company wouldn’t be worth anything.

The money to pay delinquent Kentucky property taxes is coming from profits on metallurgical coal at Justice mines in West Virginia, Getty said.

Getty said he’s holding a check for $185,000 from Jay Justice to make the initial payment on back taxes in Floyd County.

Bartley said he’s determined to pursue a judgment for the entire amount through the lawsuit if necessary and then figure out how to collect.

“That’s what courts are made for,” he said.

Kentucky Fuel
Conveyors to move coal stand idle at a Kentucky Fuel Corporation underground mine in Knott County. The company, once owned by West Virginia Gov. Jim Justice, owed more than $2 million in delinquent property taxes in May 2019. Bill Estep