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Cooper win was only option

It’s a good news-bad news couple of weeks for Northeast Mississippi.

First, it was learned that Toyota was holding off on the opening of the new automobile plant in the nearby community of Blue Springs.

More than 2,000 potential jobs gone in a part of the state that badly needed some good news after more than a 1,000 jobs have been lost in the last year in the furniture industry.

Then, there’s the good news – or the reasons for a least a big sigh of relief.

Last week, city and county leaders, joined by CDF officials, celebrated Cooper Tire & Rubber Co.’s decision to keep the 1,200-employee plant in Tupelo open and likely add more jobs here.

“Christmas has come early,” CDF President and CEO David Rumbarger has said.

However, it seems like the loss of Toyota is a punch in the gut to the State of Mississippi, which invested $200 million in infrastructure improvements while local governments have spent about $35 million to accommodate the plant.

Gov. Haley Barbour said he was deeply disappointed in the decision, but called it a “simple delay.”

I think a “simple delay” is a far too simplistic approach to the situation. When Toyota announced its intentions, the automaker called the delay “indefinite.”

Unless Barbour and Toyota has had some conversation about a real time line, indefinite is not a simple delay.

Having said that, we know Barbour is trying to put the best foot forward on the situation to ease a lot of ill feelings in desperate economic times.

Still, we, as communities and a state, have spent more than $230 million for Toyota. Sure, we have a $300-million plant in Blue Springs to show for it, but how long will we wait before we start trying to collect some of that money from Toyota?

It’s easy to say let’s wait and see what happens and give Toyota some time to make a decision in tough economic times, but the last time I checked, Mississippi is facing a $100-million budget shortfall for the coming year. Lots of government workers, state agencies and the people whom those agencies help will have to bite the bullet when cuts to the current budget take place.

That $200 million in state money sure would help the situation.

Unfortunately, there are no “simple answers” to the dilemmas we face from the “simple delay” from Toyota.

Then, there’s Cooper Tire.

It came down to Tupelo and Albany, Ga.

In this case, Mississippi’s incentive package to the company worked like a charm.

Despite what a lot of people have thought during the course of these negotiations, Mississippi did not “bail out” Cooper Tire with cash like the federal government has done with the banking industry.

But state and local officials were able to come up with a retention and growth incentives package valued at more than $30 million — spread over 10 years — to pitch to Cooper Tire, which initiated a capacity study in late October to determine ways to drastically cut costs.

According to the Northeast Mississippi Daily Journal, unions at the Texarkana, Ark., and Findlay, Ohio, plants agreed to contract concessions in the $30-million-plus range after the Tupelo incentives became public. Albany, a non-union plant, had come up with about $32 million in incentives.

“Part of our economic development strategy,” said Gov. Haley Barbour, “is to work aggressively with existing businesses to retain jobs and help create new jobs. This is a case where Mississippi’s team was able to provide a competitive solution that will work to the benefit of the entire state, the company and certainly its dedicated employees in Northeast Mississippi.”

Complete details of the incentives package haven’t been made public, but Rumbarger said some legislative action will have to be taken on a few elements included in the state’s proposal to keep Cooper. Rumbarger said those details were being ironed out by Barbour and Mississippi Development Authority executive Gray Swoope.

Layoffs at the Albany plant will begin in early March.

Everyone should be excited that Cooper decided to stay put and officials in Northeast Mississippi and state government should be commended for the work for they did. This was a win for everyone involved.

Considering the situation with Toyota, a loss was unthinkable.

Contact MBJ managing editor Ross Reily at ross.reily@msbusiness.com.

About Ross Reily

Ross Reily is editor of the Mississippi Business Journal. He is a husband to an amazing wife, dad to 3 crazy kids and 2 dogs. He is also a fan of the Delta State Fighting Okra and the Boston Red Sox.

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