Former Presto C-stores Owner Claims $482K in Unpaid State Subsidies

TOPEKA, Kan. -- The former owner of 44 Presto Convenience Stores asked Kansas' Joint Committee on Special Claims Against the State yesterday to pay his $482,195.94 claim against the state's Department of Revenue, the Topeka Capital-Journal reported. Terry Presta argued that he is owed ethanol subsidies that were approved in 2007, but never funded.

In his testimony before the committee, Presta said he spent $1.4 million on four ethanol blending stations in anticipation of the six-cents-per-gallon state subsidy approved under the Kansas Retail Dealers Incentive Fund.

"This law that was passed was part of the revenue stream that was going to allow us to do that (expansion)," Presta told the committee. "It's in the bank financing and everything."

In 2008, then-Gov. Sebelius made the decision that the subsidy could not be funded, depriving Presta of what he said was $600,000 in subsidies on fuel actually blended and sold over 2009 and 2010, according to the report.

"We're not here today to contest what Mr. Presta has said," stated Leslie Rawlings, an attorney with the Kansas Department of Revenue, in response to Presta's claim. "We're here to state that never was one penny ever funded to the department from which any claim from this incentive program could be paid."

The original subsidy legislation was sponsored by Sen. Terry Bruce (R.-Hutchinson), who is on the Joint Committee. Hutchinson said while he believes funding for the subsidy was appropriated by the Legislature despite never making it to a dealers' fund, Gov. Sebelius likely did have the authority to withhold the money.

"I understand how things have been in the state in the last two years," said Presta. "But it's the same way in business, and I think it's definitely unjust to pass a law, have somebody rely on it, spend a million and a half dollars, and then when it comes time to collect under the law, to say, 'Well, we're not going to pay you.'" Presta also noted that the state would be unlikely to lose too much money on similar claims if the committee granted his request due to the impending two-year statute of limitations on claims. The committee requested more information and promised further review.

Presta ran the Presto Convenience Stores chain until last year, when he sold the stores to The Pantry Inc.