Judge Rules Kansas Owes Pizza Magnate A $50 Million Tax Refund | KCUR

Judge Rules Kansas Owes Pizza Magnate A $50 Million Tax Refund

Mar 6, 2019

Gene Bicknell’s name is all over the campus of Pittsburg State University, his alma mater. It’s on a sports complex. The arts center is simply known as the “Bicknell,” after the homegrown entrepreneur.

But while he’s beloved as a civic booster in Pittsburg, the former businessman is far less endeared to tax officials in Topeka, from whom he’s just wrested back $48 million in revenue.

In 1962, Bicknell started National Pizza Corporation, which ultimately operated 1,100 Pizza Huts in 27 states. He sold the company in 2006 and retired to Florida, where he’d been living and registered to vote since 2003.

But the Kansas Department of Revenue determined Bicknell was still living in Pittsburg with his cat Checkers at the time of the sale. In 2010, the state hit him with a $42 million dollar tax bill, which he has been fighting ever since.

On Tuesday, he won — at least for now. A district judge ruled Bicknell had been a Florida resident when Kansas taxed him $42 million, which has swelled to $48 million with interest and penalties.

The state can appeal the ruling, though a spokeswoman for Gov. Laura Kelly wouldn’t say whether the governor plans to do so. Paying Bicknell back will punch a nearly $50 million dollar hole in her budget, which is already under threat from a Legislature skeptical of her fiscal priorities.

Jay Heidrick, one of Bicknell’s attorneys, said after more than a decade, the fight should be over.

“Our hope is that the state will give up on its attempts to extract those funds from Mr. and Mrs. Bicknell,” he said.  

Bicknell first challenged the $42 million bill in the Kansas Court of Tax Appeals (now the Kansas Board of Tax Appeals), saying he’d been a resident of Florida in 2005 and 2006.

That court sided with the Department of Revenue.

In 2016 the Kansas Legislature — over then-governor Sam Brownback’s veto — approved legislation allowing taxpayers the opportunity to challenge tax decisions in district court, giving Bicknell a second chance. He took his case to Crawford County. The district court there held an eight-day trial last year, leading to Tuesday’s ruling.

Some Pittsburg residents contend Bicknell’s already paid his due — regardless of taxes — through his donations to Pitt State and his business investments in the local community.

Bicknell started another company, Pitt Plastics, in 1972, that still manufactures trash bags in the city. For 20 seasons, the commercial radio station he started, American Media Investments, was the broadcaster for Pitt State Football.

Pittsburg city manager Darren Hall said Bicknell’s businesses brought in “quality people” who have helped the town thrive.

“They’re still here,” he said. “Their families are still here.”

Madeline Fox is a reporter for the Kansas News Service, a collaboration of KCUR, Kansas Public Radio, KMUW and High Plains Public Radio covering health, education and politics. Follow her on Twitter @maddycfox.

Fred Fletcher-Fierro of KRPS contributed to this story.

Kansas News Service stories and photos may be republished at no cost with proper attribution and a link to ksnewsservice.org.