Lawmakers approved in a special session Friday a large load of state incentives for Yokohama Tire to make heavy equipment tires in Clay County.
The House passed authorized legislation 117-2 for the project Friday morning. The Senate did the same less than an hour later. The bill now goes to Gov. Phil Bryant, who has said he intends to sign it.
The state will borrow $70 million for land, infrastructure and workforce training. Local governments will chip in $12 million, $1 million from the Appalachian Regional Commission, $900,000 from the TVA and $590,000 from natural gas utility Atmos Energy.
The first phase of the project will represent a $300 million investment from Yokohama, and create in the neighborhood of 500 jobs. The company has plans to expand in three additional phases, raising its investment to over $1 billion and job numbers to 2,000. The expansions are scheduled over the next eight to 10 years. Total state bonding authority for the project is $130 million, with everything above $70 million contingent upon the expansions.
Yokohama will build the facility on a 500-acre megasite close to West Point. Construction will start this fall with plans to start production in fall 2015. Economic development officials have spent the past several months marketing the site in hopes of luring a large manufacturer.
This is the first big fish for the new economic development consortium made up of West Point and Clay County , Columbus and Lowndes County and Starkville and Oktibbeha County. The consortium, known as the Golden Triangle Development Link, had in its sights a Yokohama-like project when it formed last year.
The House Ways and Means Committee passed the bill unanimously Friday morning. Chairman Jeff Smith, R-Columbus, said talks with Yokohama started about a year ago. He said Clay County, whose March unemployment rate was second highest in the state at 18.2 percent, was one of two finalists.
Ad valorem taxes, under a revenue sharing plan West Point and Clay County have entered into, will be split between the city and county.
The Memorandum of Understanding (MOU) between the company and the state contains clawback provisions that call for the state to receive $35,000 for every job the company comes up short in providing in each phase. For example, if the job count for phase one is 500, Yokohama will have to pay the state $35,000 for every job short of that. The same clawbacks apply to all four phases.
State Auditor Stacey Pickering will have oversight of the project, since the state bonds will be issued under the Mississippi Major Economic Impact Act. Pickering pushed legislation last session – and plans to push again next session – that would have extended his office’s oversight authority to all state bonding programs. Pickering currently does not have automatic oversight over projects assisted under bonding programs like the Advantage Jobs Act and the Mississippi Development Bank.
Rep. Steve Holland, D-Plantersville, offered an amendment to the incentive legislation that would have given Cooper Tire in Tupelo a sales tax on equipment break worth $1 million. The amendment was defeated.
“This is going to be such a shot in the arm for West Point,” Smith said.