Lawmaker prefiles bill to fix tax loophole that could cost Harlan County schools $73,000

FRANKFORT, Ky. (WTVQ) – A state senator has pre-filed a bill that could keep the Harlan County School District from paying $73,000 to a bankrupt coal mine.

Revelation Energy, a sister company of Blackjewel, overpaid a utility tax to the district and the company is owed $73,000.

On Wednesday, State Senator Johnny Ray Turner, D-Prestonsburg, prefiled a bill that looks to fix what he says is a glitch in the tax code that could force Harlan County Schools to pay Revelation Energy.

Bill Request 346 would create an offset provision, clearing school districts of refunds owed if a company has outstanding taxes owed to the district.

Harlan County Schools says it shouldn’t have to pay Revelation Energy because the company owes the county $300,000 in delinquent property taxes and that tax goes to support the school system too.

The Department of Revenue announced that it would not seek repayment by the school district unless the court decides otherwise, but Turner says that decision should not be left up to the courts.

“The fact that the state wanted to leave it in the hands of the bankruptcy court instead of taking action to decide it under state law is something I do not agree with,” Turner says. “Eastern Kentucky schools have been hit by a lot of things in recent years- they have been hit by stagnant state funding, the loss of property values, the loss of coal severance dollars, and loss of jobs. We need to clarify this statute so we do not take another hit that is avoidable.”

The bill will be heard when the General Assembly reconvenes for regular session in January of 2020.

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