Campbell County Commissioners agreed unanimously to a multi-year tax payment plan from the Navajo Transitional Energy Company (NTEC) in a county commission meeting.
Back in October, NTEC agreed to purchase the bankrupt Cloud Peak Energy with cash and the assumption of liabilities which included federal, state, and county tax payments. According to court documents, Cloud Peak owed about $90.2 million in total with $40.2 million of that owed in Campbell County property tax and ad valorem taxes.
For Campbell County, the majority of those payments were due either at the time of sale or at the end of 2019, but NTEC had yet to follow through.
"We're asking for a little bit of help, grace, mercy and leniency so that we can make those payments. As we know the thermal coal market is not in a highest of times. We are certainly much closer to a trough than we are to a peak," said Matthew Adams, a vice president and senior tax council for NTEC.
Adams formerly acted in the same position for Cloud Peak Energy.
The new plan has NTEC paying back its debt with $12 million in 2020. After that, the remaining balance will be paid in 72 equal monthly installments starting January 31, 2021 until December 31, 2026
The terms of the deal give NTEC an additional 10 days to make a payment if there is a default. As long as payments are timely, they will not accrue interest, which Commissioner Rusty Bell said should be a motivation to not be late.
"Certainly, the conversations that we've had with you guys all along has been that you're going to make those payments and that you want to be a good partner. And we know what it's like in Campbell County to work with good partners. We also know what it's like to work with not so good partners," he said.
In 2020, NTEC will make $1 million payments each month with two in February starting with a payment at the end of this week.
CORRECTION: The previous version said that payments following 2020 would be paid in six installments rather than six years of monthly installments.
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