The Register-Herald, Beckley, West Virginia

State News

August 27, 2012

IRS snafu could mark the end for Pratt

CHARLESTON — The small town of Pratt has some big problems, and Kanawha County officials said Monday it could lead to the town being dissolved.

County officials said they learned last week that the town and its water plant owe the Internal Revenue Service about $140,000 because it did not submit federal tax withholdings for employees between 2008 and 2010.

The county already had bailed out the town to the tune of $5,000 earlier this month in an attempt to head off legal action. The state threatened to sue if Pratt officials didn’t pay more than $30,000 owed by its water plant, Pratt Waterworks, over unpaid retirement contributions. Water company staff made the deductions on employees’ paychecks but failed to send money to the state’s retirement board.

The West Virginia Public Employee Retirement Board agreed not to sue as long as town leaders paid the full amount by Sept. 7.

On Monday, Commissioner Dave Hardy asked that the town’s status be placed on the agenda for the Kanawha County Commission’s Sept. 6 meeting, media outlets reported.

“It’s either receivership or dissolution.” Hardy said. “I’ve lost confidence in the ability of the town to handle its affairs.”

Kanawha County Commission President Kent Carper said he and others were not willing to provide county funding to cover the debt, but that dissolving the town is not a definite.

“That would be a last resort,” Carper said. “But the handwriting is on the wall. They do not have the finances to be able to run the town.”

Pratt Mayor Gary Fields was out of the office and did not return a call seeking comment.

Incorporated in 1905, the town has fewer than 500 residents.

County officials were working with the town in a deal to allow West Virginia American Water to take over the town’s water plant. The town informed residents in June that they had been drinking contaminated water for more than a year.

“Frankly the people of Pratt deserve much better than this,” Carper said. “They work hard and they pay their taxes.”

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