Coal company VS. CITY
Wayland City Attorney Tyler Green is asking a coal company to pay what it owes the city.
Green sent a letter this month to Thomas Sauve, president of Knott County Coal (and its subsidiary Quest Energy), the company that has a lease agreement with Wayland to extract coal from a refuse pile located on property the city owns.
Green alleges in the letter that the company is required to pay Wayland a minimum of $4,000 per month in royalties as part of that lease agreement.
“The city informs me that mining began in June, and the city has only received advance royalties of $3,000,” Green wrote. “However, the agreement states that the city should have received a total of $12,000 prior to June 1, 2018. In fact, the city has received no communication from Knott County Coal LLC regarding payment since June 2018.”
He further alleges that the company is in breach of the agreement because it would not allow Mayor Jerry Fultz to inspect records, as permitted in the agreement, and by failing to provide “accurate and true” statement about the amount of coal being extracted from the town.
Green explained the letter to the Wayland City Commission last week.
“The company was supposed to provide a minimum monthly royalty payment, I think of $4,000 a month,” Green said. “They’ve not done that. They’re supposed to provide us true and accurate statements to detail their wheelage payments. They’ve not done that.”
He said the letter serves as a 20-day notice for the company to correct the issues.
“Twenty days after the receipt of the letter, if they have not corrected those issues, we can actually terminate the agreement,” Green said. “So, hopefully, we can get their attention and get this resolved amicably.”
Commissioner Charles “Butch” Bentley voiced concerns about whether the company would honor its contract with Wayland.
“It seems to me like they’re hauling so much out of there, they might get everything hauled out and not give you nothing,” he said. “Because there’s a whole lot coming out of there; a whole lot coming out of there.”
Fultz said that concern is what prompted the letter.
“Well, he sat right here and told us what they would do,” Bentley said. “To me, he lied to you, because he hasn’t done what he said he was going to do.”
Green said if the company doesn’t keep its terms of the agreement, the city can sue for damages.
“This is the first step, I hope, toward a remedy,” Fultz said. “It’s at least bringing them to the table to talk.”
Fultz said the commission may call a special meeting if the company responds to the letter and ask officials to address the city commission.
By Mary Meadows
Floyd County Chronicle and Times