State Senator Bart Williams (R, Starkville) said he is optimistic the city of Starkville will receive matching American Rescue Plan Act funds from the state.
Williams, along with Senator Angela Turner (D, West Point) and Representative Rob Roberson (R, Starkville), met with the Starkville board of aldermen at its work session Friday to give an update on the current legislative session.
Starkville received $6.3 million from the federal government to aid COVID-19 relief. The board voted in January to identify projects those funds could be spent on, including the Main Street redesign and the 182 BUILD grant project — both of which would create a more pedestrian-friendly streetscape for both roads — and improvements to city parks.
While Williams said the Senate is wanting to prioritize water and sewer projects, Roberson said the House is looking at other projects to fund with matching dollars.
Through the Senate’s matching plan, the Mississippi Department of Environmental Quality and the Mississippi Department of Health would oversee the allocation process, giving rural water associations funds to improve water and sewer systems throughout the state.
Roberson said while improving water and sewer systems are a necessity, the House is debating only allocating half of the matching funds and waiting on the other funds because other projects, like improving streets throughout the state, are a priority as well.
“There is a lot of push for projects with streets involved and things like that,” Roberson said. “We are trying to make sure those matching funds can go to that as well.”
Ford said some cities and local governments did not receive enough money for the legislature to even contemplate matching their projects, and she said both chambers will have to navigate how to spend dollars in the best way possible.
“Where the meeting place is between those two, I have no idea at this point,” Ford said.
Williams, who serves on the appropriations ARPA subcommittee, said he has spoken with all eight of the state’s top elected officials, and they all support the spending of ARPA on water and sewer improvements. He, along with Roberson, said he is lobbying for the city to receive funds for its desired projects, whether that be from ARPA or other revenue sources, such as the general appropriations fund.
“I hope this is one of the top priorities,” Williams said. “In some way, shape or fashion, we’ll have some top dollars allocated by the time we close the session, which is five weeks from now.”
Income tax
The elected officials also discussed the potential elimination of state income tax.
Gov. Tate Reeves has been a strong advocate for canceling income tax. Both the House and Senate have created possible plans for phasing out not only income tax, but decreasing grocery sales tax as well, with the Senate’s plan passing Thursday and heading to the House.
The Senate’s plan would phase out the 4-percent income tax over four years and reduce grocery tax from 7 percent to 5 percent.
Ward 5 Alderman Hamp Beatty expressed concern for this plan, worrying about how it would trickle down to municipalities and cause them to eliminate services or raise taxes in the future.
“The state income tax — if you go look at the general fund for Mississippi — is the second largest source of revenue for the state’s general fund, almost 30 percent,” Beatty said. “When that is eliminated, whether that be next year or in four years, that’s going to be a significant loss of revenue. The question is where does it get made up?”
The House’s discussed income tax elimination plan is a 12-year phase out with trigger points, meaning the state must sustain a measure of growth before moving on to the next phase of the plan. Roberson said while eliminating income tax might sound as though the state would lose money, he believes it would be revenue neutral and allow people to spend more money, putting more dollars into local communities.
“If you don’t have a way to replace that funding, I’m certainly not for doing it,” Roberson said. “Assuming that has a basis in that you’re going to create some growth in that revenue stream, I think that it ends up being revenue neutral, but I think it could have a stronger impact for your local economy.”
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