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“Good Ole Boy” way of doing things alive and well in Breathitt County. Local CARES Act Grant process questioned.


(Appalachian Citizens Voice, “APPCV”, Is grateful & thankful that any business received aid during this crisis. Every legitimate business is hurting. This article is in no way trying to belittle or take away from any business receiving aid of any kind. This article is to simply point out facts and information obtained directly from the Fiscal Court, Treasurer and Department of Local Government, on how things are handled in Breathitt County with Grants and other aid. APPCV believes all businesses should be treated equally and not discriminated against in any way.)

What is the CARES Act and how did it come about for Breathitt County?
The CARES Act, “Coronavirus Aid, Relief, and Security Act,” was meant to help businesses and those hurt by the mandates as a result of the Pandemic. This is why the CARES Act was passed, to help those in need, those affected by the Pandemic and those affected by the Governors mandates, directly and indirectly.

Breathitt County was given a CARES Grant of $430,003 to help those in Breathitt County. Appalachian Citizens Voice, “APPCV” will be looking in to the distribution of the total Grant awarded to Breathitt County in the upcoming weeks. For now, APPCV will shed light on the process of the Breathitt Fiscal Court Small Business Relief Program, the Grant Application and how decisions were made.

In the January 26th Fiscal Court Meeting, the Breathitt Fiscal Court Small Business Relief Program was discussed and voted on by the Fiscal Court. It passed unanimously. In this meeting, Breathitt County Treasurer explained that the decision on who would get the Small Business Relief would be the decision of the Breathitt Fiscal Court. (This is important as later on a different avenue would be used to decide who got funds).
Judge Noble admirably states in this video, that ALL businesses needing help, should get help from this Grant. 

You can view the video HERE. (Skip to the 52:30 mark of the meeting to hear the discussion on the Breathitt Fiscal Court Small Business Relief Program and how things were “SUPPOSED” to happen).

Who was on the Committee? How were they Selected?
In an Open Records Request to the Breathitt Fiscal Court by APPCV, Mr. Hudson was asked for the following information about the committee.
1) Names of members of the committee reviewing Grant Applications and their field of expertise and or qualifications to be on the committee. Who selected committee members?
In a discussion with Breathitt County Treasurer, Matthew Hudson, APPCV was told that he, Mr. Hudson, spoke with the (DLG) Department of Local Government about appointing a committee to oversee the application process. Hudson stated, “The DLG told me I should appoint a group from local banks or other citizens with financial backgrounds.”

Hudson also stated, “The original group of 5 members was submitted to my chain of command. This group included James Turner Jr., Mike Miller, JB Morgan, Burley Hudson, and Charles Howard. Judge Noble and the Magistrates approved the first 5 people selected.”
(In a phone interview with Magistrate Roy Darrell Herald, Mr. Herald stated he was never given a list of possible committee members, nor did he vote to approve any of them.) 

Of this group, Mr. Hudson stated that James Turner was advised to not participate due to his role as an elected official. JB Morgan said he might have surgery so named Shawn Tyra or Billie Phipps as a replacement. Hudson pointed out, “Charles Herald and I tried several times to meet but due to scheduling conflicts, we never got to meet.”

The five Committee Members that reviewed the documents after everything was settled were, along with their area of expertise:
JB Morgan – Citizens Bank – Handles PPP Grants. Similar to this Grant
Shawn Tyra – Citizens Bank – Handles PPP Grants. Similar to this Grant
Billie Phipps – Citizens Bank – Handles PPP Grants. Similar to this Grant
Burley Hudson – Board Chairman at Juniper Health, sits on multiple other boards used to handling Federal Grants. (It must be noted that Burley Hudson is a close relative to the Breathitt County Treasurer over seeing this board.)
Mike Miller – Former Mayor of Jackson and used to handling Federal Grants

APPCV attempted to contact three Magistrates, Ellis Tincher, Donnie Bush and Roy Darrell Herald. We did not have Ray Moore’s contact information. Mr. Tincher did not respond to voice mail or private message. Mr. Bush did not respond to Facebook messenger but shows message was read.
Only Mr. Herald responded to the following questions:
1 Did you magistrates approve the committee that determined who got grants. Herald: I did not approve anything and do not know if other 3 Magistrates did.
2 Did magistrates have any input on guidelines and who was approved or denied.
Herald: Only information I had on guidelines were from the Fiscal Court Meeting. I had nothing to do whatsoever with who was approved or denied.
3 Did magistrates review list of businesses approved for grants and did you vote to pay those approved.
Herald – I never seen any list and had nothing to do with those decisions.

Judge Noble was interviewed concerning the committee as well. Noble acknowledged he saw the list of original 5 committee members. He said he was never told of changes or the final committee selected, until AFTER the list businesses approved and denied was presented. Judge Noble said he had absolutely nothing to do with the decisions the board made.

The following is what was listed on the Grant Application as requirements.
To be eligible to apply for this grant, a business must:
* Be categorized as a non-essential business type that was required to cease or reduce operations as a result of the executive orders issued by the Governor of Kentucky and has been compliant with said order.
* Exists within the County of Breathitt and is within a brick-and-mortar location.
* Own the property building or have a lease agreement with the property owner.
* Must have a valid business License and be current on all taxes and/or fees due the County and has met all requirements mandated by the Secretary of State to operate in the State of Kentucky.
* Be open and operating before January 1, 2020.
* Net Profit for 2019 of no more than $200,000 or a business with less than 25 employees.
* Not be a Franchise.
* Business must be listed in the eligible business category listed on the overview.

Eligible Businesses:
1. Retail (general, specialty)
2. Barber/Beauty Salons
3. Restaurants
4. Small Businesses closed by Governors Executive Order

Non-Eligible Businesses:
1. Home Occupations
2. Real Estate Companies/Agents
3. Attorneys
4. Finance/Accounting Firms
5. Not-for-profit organizations
6. Landlords/rental property owners

Eligible Expenditures:
1. Payroll
2. Rent/Lease/Mortgage Payments
3. Utilities

These businesses applied but were denied:
Mad Dog Garage
Jett Tours
East Ky Media, Inc.
Watts Healthcare Solutions
Campbell’s Garage
The House of Beauty
Brewer Farms
G&R Excavation
Lucas Automotive & Tire
Built Rite
R&J Repair
Altro TV Company
Walter’s Service Center
52 Auto Body Works
Barnett’s Plumbing and Heating

These businesses were pre-approved and amount approved by committee:
Steven Howard Chiropractor ($1,000)
Cut at the Curve ($2,500)
Fitness Factory ($5,000)
Jackson Window & Siding Supply ($1,000)
Richard Terry Barber Shop ($5,000)
Petals Flowers and Home ($2,500)
Campbell’s This & That ($2,500)
Kelsey’s on Main ($5,000)
Kudzu Boutique ($2,500)
Thatcher Industries ($5,000)
Miller’s Amish Bakery ($5,000)
Redbeard Vapes ($2,500)
Jett’s Home Furnishings ($2,500)
The Hair Mafia Salon ($5,000)
Hairworks by Lisa ($5,000)
Jaxon Flowers ($2,500)
Close Cuts ($5,000)
Log Cabin Trading Post ($2,500)
Jackson Inn Inc. ($5,000)
Cozy Corner Café ($5,000)
Gorgeous Grooms ($5,000)
HairLoom ($5,000)
Wayne’s Beauty ($5,000)
Cricket’s Cuts ($5,000)
Shana Moore Grocery ($1,000)|
Dexter Gas Station ($1,000)
Baker’s Auto ($1,000)
Some businesses still are pending due to committee waiting on documents to complete their application process.

Some businesses spoke up about the inconsistencies of the process.
EAST KY MEDIA Inc. Ron Hamblin: I was told by Breathitt County Treasurer Matthew Hudson, when I submitted my application that everything was in order and “YEAH IT’S GOOD”. (This is documented in phone text). Never, not once anywhere during the procedure was I told anything about not meeting criteria.

On February 26th 2021 at 1:29pm, I received a call from Treasurer Hudson explaining that my business was denied due to the fact the Committee “RAN OUT OF MONEY”. I didn’t know what to say. Towards the end of the conversation Hudson went on to say the Committee didn’t think that Media businesses were a priority. 

On Monday the 16th, I stopped in to talk to the Treasurer face to face. We again had a discussion about businesses that were approved and denied. This time I was told that when the list was presented to Department of Local Government, (DLG), that they said some of the businesses on the list, including mine, could not be approved. Mr. Hudson said even tried a second time to push our business through. I asked for the names of the people in charge of the Grant process at DLG, Mr. Hudson refused to give me that info. I did some research and found the name and number of the DLG representatives. When I contacted DLG, I was told that all approvals and denials were done at the local level.

JETT TOURS: Lillian Jett: I was told I was denied due to the fact I had a substantial SBA Loan, even though that is never mentioned in the Grant Application. 

BARNETT PLUMBING AND HEATING: Ricky Barnett: I was told my business did not meet the qualifications.

Some things that jumped out during APPCV’s research.
1) Not All businesses were in operation as of the Mandated Date of January 1st, 2020. Yet were pre-approved.
2) Was Jett Tours the only business who received a substantial SBA loan?
3) Not all businesses are listed with the Secretary of State as mandated by the Breathitt County Fiscal Court Small Business Relief Program Grant Application.
4) One business has a direct family relationship with a magistrate. Awarded $5,000
5) One Business owner is an alleged employee of Citizens Bank and awarded $2,500
6) Some businesses were denied when they met guidelines, while others were approved that apparently did not meet guidelines.

All the information in this report is derived from the following:
The Grant Application, Open Records response, Cell Phone Text Messages, Committee Minutes, Statements by Business Owners, DLG, Magistrates & County Judge. APPCV Will have more on this story as information becomes available.

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