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Has KiOR reached a purchase agreement for its product? (Update)

October 26th, 2010 2 comments

Bluefire Renewables Inc., the California-based biofuel company that is building a facility in Fulton, has reached three major milestones recently.

The company has reached a feedstock agreement that will ensure it has the biomass it needs to produce ethanol, it has found a buyer for the ethanol, and it has let the contract to actually construct its facility.

Another biofuel company that plans to build in Mississippi, KiOR, will not receive any of the $75 million in benefits the Legislature approved for it in late summer until KiOR has reached a purchase agreement with an oil company (or companies) to buy the renewable crude oil and refine it.

KiOR CEO Fred Cannon said in late August that he and his team were “in final negotiations” with a buyer. With that in mind, Magnolia Marketplace has been trying since Monday morning to find out if an agreement has been finalized; and if not, how close one is to becoming finalized. Calls and emails to a KiOR spokesperson have not yet been returned. Gov. Haley Barbour’s spokesman Dan Turner was not exactly sure one way or the other. We’re currently awaiting a response from the Mississippi Development Authority.

It would seem nothing can move on this project until KiOR has found somebody to buy and refine the re-crude it plans to produce from timber. The bulk of the state money approved for the project will go toward construction costs and the equipment that will stock it.

So has a purchase agreement been reached? It’s not a hard question. When we get an answer, we’ll let you know.

UPDATE: A KiOR spokesperson just emailed Magnolia Marketplace and said there had been no off-take agreement reached, and that discussions between the company and potential buyers remain ongoing.

No firm timetable exists for executing a deal, but it’s our guess that they’d like to get one done as soon as possible.

Barbour to miss Hobnob

October 22nd, 2010 No comments

The Mississippi Economic Council’s annual Hobnob is next Thursday. Hundreds of business leaders and politicians will be there.

Gov. Haley Barbour will not.

According to Dan Turner, Barbour’s press secretary, the governor will spend that day in New Hampshire and Pennsylvania campaigning for GOP candidates before Nov. 2’s midterm elections. Barbour will be one part of a large contingent of Republican leadership who will embark on a last-minute blitz that starts Tuesday and ends Saturday.

“He’s not real excited about missing it,” Turner said of Barbour’s absence. “That’s his element.”

Scott Waller, senior VP for public affairs at the MEC, said this is the second Hobnob Barbour will miss, the first coming in 2005 in the aftermath of Katrina, when Barbour was in Washington and addressed the crowd via satellite uplink.

There’s a good reason Barbour has been at all the others. It’s the largest gathering of the business and political community of the year. Lots of people with lots of money who give that money to political campaigns of every stripe are always there. If you run for office at any level in Mississippi, it’s a can’t-miss.

Granted, Barbour isn’t running for office, at least not officially and at least not one in which only Mississippi voters can participate. And his position as chairman of the Republican Governors Association requires him to campaign nationally (though he would probably do that anyway) and we doubt anybody is all that offended that he won’t be there next Thursday. He will address the crowd via video.

But Barbour is still the governor of Mississippi. Helping our state recover from Katrina is a perfectly good reason for missing Hobnob. Pitching voters in New Hampshire and Pennsylvania is not. Barbour should have made time.

Corollas not on Toyota’s latest recall list

October 21st, 2010 4 comments

A lot of folks lost a lot when that oil well in the Gulf of Mexico started gushing.

If there were a winner, it was Toyota. Just before the well blew Toyota was the hottest news around, and it wasn’t because everybody liked Camrys.

Rather, the company was being excoriated by consumers, industry analysts, even Congress for what was considered its less-than-ideal response to a wave of problems with its vehicles, most of them to do with sudden unintended acceleration. So when the Gulf started filling with oil, Toyota’s PR nightmare was replaced with BP’s.

Toyota recall news returned today, when the company announced that it was issuing recalls for several of its Lexus models and its Avalon because of problems with their brake fluid and fuel pumps. Nearly 750,000 cars in the U.S. and 600,000 in Japan are affected.

The good news: The Corolla, the compact sedan Blue Springs workers will begin producing next year, is not on the list. The bad news: This latest recall brings to 10 million the total number of vehicles Toyota has recalled in the past year, including 1.33 million Corollas in August due to concerns over their engines stalling.

This could be an illustration of Toyota being overly cautious. Or it could be a legitimate recall. Either way, Toyota seems determined not to let this recall issue eat it up like it did last spring.

Natchez rec funding hits a snag

October 18th, 2010 5 comments

Two weeks ago, we wrote a story that took a look at a few Mississippi towns that were either making plans or had firmed up plans to build multi-use recreational complexes.

Natchez was one of them, and there is news to pass along.

The Natchez-Adams Recreation Commission had gotten financial commitments from the city, county and the school board to help fund the planning costs of the complex. Each entity had promised to give $11,000 toward the effort.

The city and the county money encountered no trouble on its way to the Recreation Commission’s bank account. The school board’s cash has.

State law does not allow for a school board to spend money outside of its school district. Apparently, the site of the recreation complex sits outside of the Natchez-Adams School District’s lines. But there is a provision in that statute that allows school boards to provide for and regulate athletic activities. The school board is currently seeking an AG’s opinion on whether the recreation complex meets that definition.

Recreation Commission chairman Tate Hodby, who we spoke to for the story we wrote, told the school board in a letter that the Commission would have no problem designating the board’s $11,000 for improvements in facilities and  equipment within the district’s boundaries. So while it doesn’t seem that the funding is in serious jeopardy, this is an issue that will have to be cleared up before any money exchanges hands.

Staying in Natchez, this week’s MBJ includes a story about Chandler Russ, who is leaving the MDA to take the director’s job of Natchez Inc., the new economic development agency for Natchez and Adams County. The old Natchez-Adams Economic Development Authority had a rough couple years before it was finally dissolved. The Adams County Board of Supervisors pulled its funding in March 2009, right in the middle of the fiscal year, before restoring it after an AG’s opinion ruled that it was illegal to pull an agency’s funding before the end of a fiscal year.

Now comes news from Booneville, where city officials voted to stop funding the Booneville Area Chamber of Commerce for the 2010-2011 budget year. The city was contributing $3,780 per month to the Chamber. The city will provide free office space and utilities to the Chamber.

A lot of chambers and economic development agencies across the state are having to rely more than they’d like on private money, as the recession squeezes city and county budgets. Most experts in the field agree that public-private partnerships work best for funding and operating chambers and EDAs. Looks like Booneville’s, for the time being at least, will have to lean heavily on the private side to survive.

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Barbour toots job-creation horn

October 14th, 2010 No comments

Most of the press releases that come out of Gov. Haley Barbour’s office have something to do with an event.

The governor’s holding a press conference. The governor’s filling an empty seat on a judicial bench. He’s making an appointment to a state agency. He’s setting the date for a special election.

If they aren’t announcing something, they usually contain a statement relevant to a recent event. Here lately, most of his comments have taken on a national tone, hitting on broad political themes.

But we’ve never seen one quite like the one that landed in Magnolia Marketplace’s inbox a few minutes ago. For one, at more than 900 words, it’s a lot longer than most. Second, it’s not really announcing anything. What it is doing is pointing out some of Barbour’s year-to-date economic development wins.

According to the release, more than 5,000 new jobs were created in the first three quarters of 2010 by state-assisted economic development projects. Mentioned are Will.Schulz GMBH — the German company that hopes to manufacture at its Tunica facility pipes for the natural gas industry — Lane Furniture’s expansion in Lee County and Southern Motion’s 200 new jobs in Pontotoc, among many others.

The 5,000 new jobs created with the state’s help in the first nine months of this year, says the release, are more than what were created in all of 2009. It also mentions, but does not give a figure, that job-creation has been spurred by projects that did not seek state assistance, financial or otherwise.

Every project listed in the release is old news. No ground is being broken, just re-tilled.

So what’s the point? Well, wouldn’t job-creation within his own state be a leg of any platform Barbour might use in a presidential campaign? Sure would. And it’s our guess that this won’t be the last press release of its kind that Barbour puts forth.

You can read the release in its entirety here.

Gov. candidates of one mind on eminent domain (Update)

October 6th, 2010 No comments

Magnolia Marketplace is not finding much disagreement among the 2011 candidates for governor on the issue of employing eminent domain for private economic development.

Two of the three Republicans who are running support Farm Bureau’s efforts to put the issue on the ballot.

So do the two Democrats who hope to reach the Governor’s Mansion.

“As a businessman I strongly encourage economic development, but using eminent domain as a device to take privately owned land to transfer to developers is improper,” Bill Luckett, a Clarksdale attorney, said in a statement emailed to Magnolia Marketplace.

“Mississippians should be able to count on preserving their individual and personal rights against overbearing big government. (Farm Bureau’s) initiative protects private citizens from governmental abuse. Passing this initiative will greatly discourage government entities from taking one’s property for the sole purpose of making money.

“Unless property is taken truly for the good of the public, I do not believe in using confiscatory endeavors as a means of economic development.”

Luckett joins Lt. Gov. Phil Bryant and Gulfport businessman Dave Dennis in supporting the Farm Bureau petition.

“I tend to agree with them,” Hattiesburg Mayor Johnny Dupree, a Democrat who will oppose Luckett in the primary, said in a phone interview Monday afternoon. “It it is used for public use, I certainly support that.”

The other Republican in the race, Pearl River County Supervisor Hudson Holliday, has not returned a voicemail we left on his cell phone Tuesday afternoon. If and when he does, we’ll let you know his stance.

UPDATE : We just heard back from Holliday. He said he understands the principles behind employing eminent domain for private economic development. That doesn’t mean he agrees with them.

“It’s a slippery slope and something that can easily be abused,” Holliday said. Holliday added that he signed Farm Bureau’s petition. That makes two gubernatorial candidates — Lt. Gov. Phil Bryant is the other — who have confirmed that they signed it.

So if you’re scoring at home, every candidate who has either unofficially or officially started pursuing the governor’s seat is in favor of restricting the use of eminent domain to projects that serve a direct public use — like roads, bridges and utilities — and eliminating the government’s power to take private property and give it to a private entity for development.

Bryant, Dennis agree: No eminent domain for private use

September 30th, 2010 12 comments

If Dave Dennis and Lt. Gov. Phil Bryant are going to butt heads over an issue in their bids to be the Republican nominee for governor in 2011, they’ll have to find something other than the use of eminent domain for private development.

Both are adamantly against it.

“I have long tried to find common ground between Farm Bureau and the Governor on this issue,” Bryant said in a press release. “There must be a balance between growing jobs in our state while not trampling the rights of our citizens. I am for property rights and congratulate Farm Bureau on what appears to be a successful petition drive.”

Bryant was referring to Mississippi Farm Bureau Federation handing over to Secretary of State Delbert Hosemann Thursday morning 119,000 signatures of registered voters who oppose the use of eminent domain for private development. Mick Bullock, spokesman for Bryant, said the lieutenant governor was one of the folks who signed Farm Bureau’s petition.

Most likely, the issue will appear on the 2011 ballot. Bryant also alluded to Gov. Haley Barbour’s vehement opposition to the restriction. During the 2009 legislative session, Barbour vetoed a bill that would have eliminated the government’s power to employ eminent domain for projects that did not serve a direct public use, like roads or bridges. His veto was narrowly sustained in the Senate, after being overwhelmingly overridden in the House.

Barbour argued then that stripping government of the power to use eminent domain for private economic development would be deal-killers for major projects like Toyota and Nissan.

Dennis, a Gulfport businessman, disagrees.

“Plainly and simply, if a development is that good and that attractive and that resourceful, then there should be appropriate dollars associated (with it),” he said. “If somebody thinks there’s that good a return coming in, they should be willing to pay market or even premium-of-market value. If for some reason people still would not sell, then you work around them.”

Dennis told Magnolia Marketplace that he has had two pieces of property over the years seized by eminent domain, both times to clear the way for road-widening projects.

“That eminent domain I’m very comfortable with,” he said. “Eminent domain should not be used to take private property for private development. If you’ve got a piece of property that has stayed in your family, it’s hard for me to swallow somebody coming in and taking it.”

Waide: No decision about running for election

September 30th, 2010 1 comment

Magnolia Marketplace just returned from Secretary of State Delbert Hosemann’s office, where the Mississippi Farm Bureau Federation delivered 119,251 signatures of registered voters who oppose using eminent domain for private economic development projects.

The issue will very likely be on the ballot in 2011.

Lots of media were there for the ceremony, including our favorite reporter ever, Bert Case of Jackson television station WLBT.

Case asked Hosemann if he would run for re-election next year, or seek a higher office. The rumor mill has been churning for some time now over that very question.

“Are you addressing that to David?” Hosemann retorted, with a hearty laugh. “I think we’ll stay on eminent domain today.”

Afterward, Magnolia Marketplace asked Waide if he had made a decision about next year’s elections. He too has been the subject of a lot of speculation. He will step down from Farm Bureau Dec. 6.

“I’m President of Mississippi Farm Bureau,” Waide said. “I asked the people in ’96 to elect me, and I promised them I’d serve my term. I’m stepping down Dec. 6, but I actually  have not made a decision. I don’t anticipate announcing prior to my leaving office.”

So has Waide not made a decision about whether to run, or has he not made a decision about which office he’s going to seek?

“I have not made a decision about whether I’m running or not,” he said.

So there you go.

Farm Bureau delivers eminent domain signatures

September 29th, 2010 No comments

Looks like the question of whether to use eminent domain for private economic development projects will be on the 2011 ballot. Here’s a release Farm Bureau sent out earlier today:

JACKSON – The Mississippi Farm Bureau Federation today delivered more than 118,000 certified signatures to Secretary of State Delbert Hosemann so that the issue of eminent domain reform can be placed on the November 2011 ballot for the people of Mississippi to vote on.

After several failed attempts to get an eminent domain reform bill passed in the legislature, the Mississippi Farm Bureau Federation (MFBF) decided to go the initiative route and gathered the necessary signatures to allow the people of Mississippi to speak on the issue of private property rights.

“For three years, Farm Bureau urged legislators to protect homeowners and landowners from confiscation of their private property by eminent domain, but to no avail,” said MFBF President David Waide.  “The 2009 Legislature passed H.B. 803, which prohibited the taking of private property under the guise of economic development for private development or business. Both House and Senate passed the bill, but Governor Barbour vetoed it.”

In 2005, the U.S. Supreme Court held in a 5-4 decision in Kelo v. City of New London that a Connecticut city could take away people’s homes and turn the property over to a private party to develop the property for its own profit. The Court justified this result because the increased tax revenue on the developed property would benefit the public and the use of the property was, therefore, a public use.

Farm Bureau and many others disagree with this decision.

Since 2005, forty-four states have strengthened their private property rights laws to keep property from being taken by eminent domain and used for economic development.  This initiative will give the people of Mississippi the right to vote to ensure that eminent domain will be used only in the traditional ways for public use such as roads, schools, and utilities.

Chinese Co. solidifies stake in Amory steel mill

September 15th, 2010 No comments

What was already official became officially official yesterday in China.

Anshang, a partially state-owned Chinese steel company, finalized an agreement with Steel Development Corp. to purchase a 14 percent stake in SDC’s facility in Amory that will manufacture rebar.

Magnolia Marketplace wrote a story two months ago about some of the angst this was causing members of the Congressional Steel Caucus. They were concerned this move was part of a Chinese plan to manipulate the U.S. steel industry from within, and wrote a letter to Treasury Secretary Timothy Geithner asking him to investigate the matter. The only thing new out of yesterday’s announcement is the 14 percent number. Originally, an SDC spokesman confirmed to the Mississippi Business Journal that Anshang would purchase a  “less than 20 percent stake” in the mill.

Neither Cong. Travis Childers, D-Booneville, who represents Amory as part of the 1st District, nor his general election opponent, Tupelo Republican Alan Nunnelee, had much of a problem with the Chinese investment when we spoke to them in early July. Neither did State Rep. Jimmy Puckett, D-Amory. They all said the area could use the 175 jobs SDC planned to provide once the facility is open. Childers expressed the most concern of the three, saying at one point in his interview with us that he didn’t want to “sell us out to Red China.” Nunnelee was probably the least bothered, countering that the Steel Caucus, whose members are mostly from the Rust Belt, might be a little jealous. “Sounds to me like it’s people trying to meddle in Mississippi’s business,” he said in early July.

At that time, there was no target date for the mill’s opening. That’s still the case.

To go with its 14 percent stake, Anshang will provide some of the technology the mill uses to make rebar, and it will also have a seat on SDC’s board.