CHARLESTON, W.Va. — Flanked by regulators who serve as his employees, Gov. Jim Justice said his companies have made good on their West Virginia back taxes but did not state the total amount paid or clearly describe whether it was the full amount owed.
“Today’s a good day for me,” Justice said.
Justice’s background as a businessman and his influence as a billionaire were big parts of his campaign for governor in 2016. But those issues also drew questions about how he would handle the 116 companies he listed on his financial disclosure forms or their related debts.
A 2016 National Public Radio report that was published when Justice was running for governor said his companies owed $15 million in taxes and fines.
That amount was spread over six states. The amount has grown, with additional tax liens being filed since the original report.
The amount in West Virginia was $4.71 million, according to NPR. Justice today said he was only describing payment on the West Virginia debt, alluding to likelihood of a similar repayment in states like Kentucky and Virginia over the coming months.
State Revenue Secretary Dave Hardy and Deputy Secretary Allen Prunty, both employees of the governor, said the tax debt of Justice companies was resolved this afternoon after a long period of working on the issue.
“The state tax department is completely and totally satisfied with the resolution of these matters,” Hardy said, saying he anticipates the removal of liens within the next 48 hours.
Prunty added, “I think it’s a great day to say we can put this to bed.”
Austin Caperton, the secretary of environmental protection, was also up front to support Justice and to talk briefly about reclamation debt on the mine properties.
Caperton said his remarks came from a position of friendship with the governor.
“I think it’s time everybody stop throwing stones,” said Caperton, a former mine company executive. “Everything he has said he would do he has done.” He concluded his remarks by saying, “Thank you governor and friend.”
Justice said he had exerted no influence over the state officials.
“I never spoke one word to either one of these people,” the governor said.
Although the governor himself called an afternoon press conference to discuss the matter, Hardy and Prunty said they are not permitted by state law to publicly provide specific tax information about private citizens or companies.
“I’m not at liberty to say the total amount or give you specific details because state code prohibits me from doing that,” Hardy said, “but I can say it resolves all outstanding issues with the state of West Virginia.”
Hardy added: “It was vetted, reviewed, and all parties have agreed to the appropriate amounts.”
Prunty said significant work has gone into concluding the matter with the representatives of Justice’s companies. He said that included an audit. He said the removal of the liens, which have been “unfairly used to say no taxes are being paid,” will be evidence of a resolution.
“It took a while for the tax department and the taxpayer, Jay Justice and his companies, to work these matters out and to get them resolved,” Prunty said. “All liens are going to be released and everything that’s owed will be paid as has been agreed to between the parties.”
Justice has turned over management of his coal operations to his son Jay.
So when the governor, sitting right beside the revenue secretary, was asked the amount of the payment, he said he didn’t know the details.
“I don’t know what the amount is, even at this moment,” Justice said, deferring to Jay, who was not present. “I know it’s millions of dollars.”
The entire group was asked if the full amount was paid or if a deal had been worked out. The response, provided by Prunty, didn’t directly address the question. The state officials described the issue as having been resolved.
Justice seemed to allude to negotiations that led to an agreement on what should be paid.
“I have told you that these people have conducted what their work — and in any work, there’s going to be disputes, you know, where one party doesn’t think they owe something and the other party does think they owe it and everything and they work things out,” the governor said.
“And I’m sure there was some give and take as they went through whatever they were doing.”
The lack of detail drew scrutiny.
“I am glad the Governor finally got around to paying some portion of the taxes he has owed the state of West Virginia, and various counties, for quite some time. I am disappointed, however, that he was unwilling to state publicly whether his taxes were paid in full, including with interest and penalties,” stated House Minority Leader Tim Miley, D-Harrison.
“It’s clear they were not, otherwise, he would have proudly said so. Instead, he reverted to the same old, same old, i.e. hosting a pity party for himself while blaming others for his tax problems. Integrity and transparency dictate that Governor Justice release all of his tax information, in writing, reflecting the amount of taxes owed, with interest and penalties, and the ‘deal’ he worked out with the WV Tax Department. Anything less suggests there is something he does not want the public to know.”
Justice spent part of the press conference describing the 2009 sale of his coal holdings to the Russian company Mechel for $568 million and then buying back the coal company Bluestone back in 2015 for $5 million.
He blamed much of the tax debt on the Russian company, a contention that drew a response from the writer of the original NPR investigation.
None of the unpaid state and federal taxes documented by @NPR in 2016 were “really owed by the Russian company.” We were careful to only report debts incurred by Justice-owned companies when he owned them: https://t.co/SnLJijjmax … https://t.co/h7TWbUH0i6
— Howard Berkes (@hberkes) August 6, 2018
Justice said the Russian company would have pulled out of southern West Virginia as coal markets struggled. Under those circumstances, he said, they also would have left their own tax debt unpaid.
“They were leaving. They were leaving West Virginia,” Justice said.
He said it was worth it to take on the responsibility of running the coal business in southern West Virginia, even during the struggle. He said many companies would have declared bankruptcy, but he didn’t want to choose that.
“It has stretched our companies beyond belief to overcome this situation right here,” Justice said. “We started plotting the course to come back and build it back.”
The tax debt has dogged Justice’s reputation from the time he ran for governor to the present. He said he has been asked many times on the street, “When are you going to pay your taxes?”
“It’s been no fun,” he said today.
— Governor Jim Justice (@WVGovernor) August 6, 2018