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Significant residential growth seen

Hub City sales tax collections flat for this year

HATTIESBURG — Sales tax revenues in Hattiesburg are no longer growing at the rate of 6%, the average seen in the 1990s. But neither have sales tax collections declined.

“If you watch this stuff long enough, you do see it goes in cycles,” said Joe Townsend, chief financial officer for the City of Hattiesburg. “Some years are banner years, and others are not so good. Right now we’re in a leveling off mode with sales taxes.”

Thus far in the fiscal year sales tax collections have brought in $8.5 million, which is about $20,000 more than last year. That represents an increase of less than a quarter of a percentage point. But since the city didn’t plan for growth in sales taxes when setting the budget, no shortfalls have resulted.

On the flip side, the city has seen considerable growth in residential development with 2000 logging the best rate of growth seen in a decade.

“We have had some real good growth on the property tax rolls,” Townsend said. “We went for a period of time in the early 1990s when we didn’t have much residential construction going on at all. In 1991, we had only nine permits issued for residential, and in 1992, only 26 permits were issued for residential. In 2000 we had 33 commercial permits, and 133 residential construction permits. If you look back over a period of time, the 133 that were issued in 2000 is by far the best year in the last 10-year period.”

Commercial construction projects totaled $10 million, and were down from previous years. That probably reflected a slowdown in the retail sector seen during a period of slow economic growth.

The residential construction was seen throughout the city, and totaled $23 million in value.

“This does show good growth in the tax rolls,” Townsend said. “There were a lot of years when we had really good growth in sales taxes, but we didn’t have nearly this kind of growth in terms of our property tax rolls. So there is a pretty good little trade off going on. Sales taxes have leveled off over the past year and a half, but we are pleased about the growth to our property tax rolls.”

And what was seen in 2000 could be far eclipsed in the future by a proposed Cooper Land Development Inc. project that would add 3,000 to 4,000 homes to the area in the next 10 years.

“If this is successfully completed, it will be equal to or exceed the benefits of recruiting a large industry like Sunbeam or Kohler to the area,” said Hattiesburg Mayor Ed Morgan. “It’s a quality, high-scale development that would bring in a system of marketing to attract people from outside into our area. A majority of those would be retirees. It would benefit the entire region , not only creating jobs through the construction portion, but putting additional dollars into our retail, wholesale, medical and service industries.”

Morgan said Cooper Land Development is a well-established development company that has been extremely successful elsewhere in the U.S. where it has established similar retirement communities.

The company based in Bella Vista, Ark., has an option on about 2,200 acres of land primarily in Forrest County with a portion in Lamar County. The land is located about a mile south of Hattiesburg on Highway 11 towards Purvis. The proposed gated community would include a 250-acre lake and an 18-hole golf course, and would attract about 5,500 residents.

The acreage is currently outside the city limits of Hattiesburg. Cooper Land Development has asked for the city to consider annexing the land in order to allow the development access to city services. Morgan said response to the proposal has been very positive, and the city is moving towards a basic assessment needed to meet the request for annexation.

The land is about one and a half miles from the current city limits, and property between the city limits and the land optioned by Cooper Land Development would need to be annexed. Morgan said the city is in the process of talking to landowners between the city and the site to reach agreements that are mutually beneficial to the city and the landowners.

“Some might want all of their land taken in and some might want just a portion taken in,” Morgan said.

Gray Swoope, president, Area Development Partnership (ADP), said the interest of a major developer like Cooper is indication that the area has done a good job with economic development.

“If the area is doing a good job recruiting good-paying jobs, then support services and more residents follow,” Swoope said. “I feel this proposed project is a result of our community continuing to be a center for employment. It is becoming a destination for people to work, raise families, and retire.”

Swoope said being selected for a project of this scope and quality is good news not just for Hattiesburg, but for the entire state.

“It is big news that Cooper Land Development has selected Mississippi for a potential 2,200-acre, planned residential and retirement community,” Swoope said. “If you look at Cooper and their experience, they have right now 120,000 property owners who have memberships in their developments across the country. They have been doing it basically since 1954.”

The company’s projects include Hot Springs Village, Hot Springs, Ark., Bella Vista Village, Bella Vista, Ark., Savannah Lakes Villages, McCormick, S.C., and Tellico Village, Loudon, Tenn. Swoope said one good thing about the project is that it doesn’t compete with local developers. The company has a sophisticated marketing campaign aimed at attracting retirees to relocate to their planned communities rather than competing for home buyers already living in the area.

“To me, this is one of the biggest things that has happened in South Mississippi in a long time regarding residential development,” Swoope said. “If the project goes ahead, it will generate millions of dollars in revenues for Lamar, Forrest and Hattiesburg. It will enhance the tax base, and have an impact even outside this region. They spend millions annually for marketing their developments. So it will add more visibility to the area.”

Jim Abrahamson, land acquisition manager for Cooper Land Development, said developments the company has done similar to the one proposed for Hattiesburg have reached $200 million or more in value.

“We know if we do a development it would have a championship golf course, a clubhouse and basic infrastructure for subdivision build out,” Abrahamson said.

The company doesn’t build all the homes, which provides plenty of opportunities for local homebuilders. Home prices for the proposed development would start at about $120,000 and could go as high as $1,000,000.

Abrahamson said the company has looked at Hattiesburg since the 1980s, and is attracted by the area’s strengths in education, medical services, retail, restaurants and highway infrastructure.

“We like the highway network,” Abrahamson said. “It is a real feeder for winter vacationers, and we would hope to capitalize on some of that flow of traffic that tends to go through Hattiesburg in the winter months. And we like the weather. It is a little more four-seasons weather than some of our communities.”

If all goes well the company hopes to begin applying for development permits in about three months, and will start work on the project in 2002. But Abrahamson said the project is still at a very preliminary stage, and a decision to proceed may not be forthcoming until the end of the year.

Contact MBJ staff writer Becky Gillette at mullein@datasync.com or (228) 872-3457.

About Becky Gillette

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