JACKSON — Now that legislators have approved Gov. Ronnie Musgrove’s new economic development plan, more tedious work follows: implementation of the Advantage Mississippi Initiative.
“Some parts of the bill will become effective immediately, while other parts won’t become effective until Jan. 1,” said Sherry Vance, spokesperson for the newly named Mississippi Development Authority. “Basically, the name change goes into effect immediately. However, we can utilize both names as necessary. For a while, we’ll use both until the move to our new location is complete.”
Legislation effective Jan. 1 includes the Growth and Prosperity Act (GAP) and amendments to the Jobs Tax Credit Program and Basic Skills Training Tax Credit Program.
“It’s normal to set the effective date for tax-related legislation for the beginning of a new tax year — Jan. 1,” said Steve Pittman, MDA staff attorney.
In the Basic Skills Training Tax Credits amendments, employers would receive a 50% income tax credit for providing certain basic skills to employees, with training provided or approved by the employer’s community and junior college district.
Under GAP, county supervisor districts are eligible to participate if 30% or more of the population on June 30, 2000, is at or below the federal poverty level and the district is adjacent to a participating county. Designated counties could offer temporary relief from property, franchise, income and sales taxes to certain businesses, with tax exemptions that could last 10 years or until Dec. 31, 2015, whichever is first. Eligible tax exemptions would not include local property taxes that help fund public schools.
So far, only a few economic developers have called about legalities or technicalities of various programs, Pittman said.
“We’ve had a couple of calls from developers relative to the GAP program — about which counties are eligible right now and how the bill’s supervisory districts will work,” he said.
The remainder of the bill, primarily the Mississippi Advantage Jobs Act, ACE Fund, the Regional Economic Development Act and other amendments, and the name change of the Mississippi Department of Economic and Community Development to the Mississippi Development Authority, is effective immediately, Pittman said.
The Mississippi Advantage Jobs Act allows qualified businesses and industries to receive a rebate of up to 4% of the business’ gross payroll (the governor asked for 5%). Businesses and industries must create jobs that pay salaries equal to 125% of the most recently published average annual state or county wage, whichever is less, provide a MDA-approved basic health plan, and include applications for the tax break that reflects whether or not a retirement plan will be furnished. Businesses and industries in counties with unemployment at 150% of the state rate must create at least 10 high-paying jobs, while businesses and industries in other counties must establish at least 25 high-paying jobs.
Local economic development entities could apply for grants from the ACE fund to help expand businesses, and interested businesses must apply first to a local economic development entity, proving they are an economic development opportunity. Rules for the ACE fund must be submitted by MDA to a 10-member committee, consisting of five members each from the Senate Finance and House Ways and Means committees. The money must be requested by MDA during the 2001 Legislature.
In the Regional Economic Development Act, local governments, defined as cities and counties, can join others in Mississippi and those in other states to create regional economic development alliances with MDA authorization. MDA must approve or decline applications within six months of receiving them. Governments would share in the cost and profits derived from an economic development project and could pledge revenue from an economic development project to secure the payment of money borrowed for the project.
The Small Municipalities and Limited Population Counties Initiative allows MDA to use at least $1 million of a portion of money borrowed through the Mississippi Business Investment Act to help cities with 10,000 or fewer residents, or counties with 30,000 or fewer residents, complete infrastructure projects.
“For now, we’ll be terribly busy writing the rules and regulations for all of these programs,” Pittman said. “For programs effective on passage, we will have to work as quickly as we can to get the rules and regs in place. Then, we have to follow the Administrative Procedures Act to get them promulgated and get them officially adopted. There’s a timeline of about 60 days through the secretary of state’s office.”
Because several sections effective upon passage are amendments to current law, the rules and regulations are already in place and should provide a “seamless change,” Pittman said.
Contact MBJ contributing writer Lynne Wilbanks Jeter at firstname.lastname@example.org or (601) 853-3967.