Columbus City Council unanimously approved a tax abatement Tuesday for equipment purchases for JTB Furniture. The company asked for the help to enable it to remain competitive in an increasingly turbulent business environment.
The abatement period is 10 years, but that time period started running at the date of acquisition of the equipment, explained City Attorney Jeff Turnage. That means the company will not get the full 10-year period allowed by law, but will instead have staggered tax breaks over the next several years.
Cities and counties can offer tax exemptions for equipment to industrial/manufacturing companies per state statute, Turnage said.
According to figures Turnage provided, the company invested about $1.4 million in 2017, about $804,000 in 2018 and about $261,000 in 2019. The company will save $19,500 in taxes per year for six years, then that amount will fall to about $9,000 for a year, and then the following year will fall to about $2,000.
JTB was founded in 1932 and made residential furniture. It branched out into making furniture for hotels in the 1980s, and, since 2004, shifted entirely to the hospitality industry. Owner Reau Berry told the council members that when they had stayed in a major hotel, they were probably surrounded by JTB’s products.
With the COVID-19 pandemic, the hospitality market collapsed and the company is trying to shift back to residential products, which are thriving.
“If there’s a time to turn the company around, now’s the time to do it,” Berry said.
Overseas competition in the industry, combined with the ongoing COVID-19 pandemic, are cutting deeply into JTB’s business now, he said.
“The Chinese came into our marketplace to take the jobs,” he said. “So many of the manufacturing plants located in Columbus, as you know if you ride around, are closed.”
Chinese businesses approached him about using his brand as “their storefront,” but he turned them down, he said.
JTB has maintained an about 300,000-square-foot facility in Columbus, he said, and in 2017, 2018 and 2019 a total of about $2.5 million was invested in new equipment.
At one point JTB had 1,300 employees and was the largest “single-shift employer” in North Mississippi, he said, but right now that has shrunk to about 100, with an average pay of $12.95 per hour. It’s one of the last manufacturers inside the Columbus city limits.
The plant’s workers are unionized, he said, and about to renegotiate its contract.
“The American workforce has been under tremendous strain,” Berry said. “The only way to survive the Chinese coming into our marketplace was to re-equip. … Now I’ve got to make some hard decisions. If y’all approve this, I will continue to fight for my employees and I will continue to keep my business open.”
Ward 2 Councilman Joseph Mickens and Ward 1 Councilwoman Ethel Taylor Stewart both praised JTB for its local impact.
“This company has been a big help to where I’m from, in Noxubee County,” Mickens said. “… I know that company has saved a lot of families and put bread on people’s tables and clothes on people’s backs. We don’t need to lose (any) more companies in the city.”
“My biggest thing is that you have 100 employees,” Stewart said. “That’s 100 people who won’t be out of work if we help you. Hopefully you will find a way to go from 100 back to where you were.”
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