District 4 Supervisor Bricklee Miller talks to Golden Triangle Development LINK CEO Joe Max Higgins about a tax exemption request during Monday's Board of Supervisors meeting. Photo by: Alex Holloway/Dispatch Staff
June 5, 2018 10:48:31 AM
A routine tax exemption request from a local manufacturer prompted Oktibbeha County Supervisors to examine the need for a set of standards for exemption requests.
Golden Triangle Development LINK CEO Joe Max Higgins approached the board at Monday's meeting about a request from Southwire, which is located on Airport Road across from George M. Bryan Airport, for a tax exemption on a recent expansion.
"Southwire's doing a multi-year expansion," Higgins said. "The one we're talking about has created about nine jobs with an estimated payroll of $450,000 and an overall capital investment of just short of $3.1 million."
Supervisors ultimately approved the 10-year exemption 4-1, with District 4 Supervisor Bricklee Miller opposing.
However, Miller initiated a discussion about giving tax exemptions to any company that asked for them. She said eroding a county's tax base through giving tax exemptions was a topic of conversation at a recent supervisors' conference.
"Southwire has done a great job and is expanding their company. That's good management," Miller said. "But, as a county trying to work off of a tax base that's already insufficient of what the needs are for infrastructure and other areas, I think we have to be very concerned when we do the tax cuts because in retrospect we have to turn around and raise taxes."
Miller asked Higgins for his thoughts on the matter. Higgins avoided saying what he thought supervisors should do on the particular issue, noting that it was their call. However, he pointed out that Lowndes County has a set procedure for dealing with tax exemption requests. He said companies have to invest at least $5 million to get a tax exemption in Lowndes County.
"What Lowndes County has done is establish a threshold," he said. "It's not tied to the number of jobs, it's tied to the investment.
"If you have a major company that goes one year, two years, three years, four years and they make no reinvestment in equipment, we put them on the prayer list," he added. "I could tell you that Omnova was going to close before Omnova closed in Lowndes County. That Sanderson Plumbing (in Columbus) was going to close because for 10 years, they didn't make any capital investments."
District 3 Supervisor Marvell Howard said he wanted to support allowing exemptions for existing industries.
"I've always been like this -- if I'm going to do this to attract new industry I damn sure want to take care of our industry that's already here," Howard said. "I look at it as, if they are creating nine new jobs that means you have salaries now that are going to flow back out into the community."
Higgins said the exemption would exempt Southwire from $25,500 per year in taxes to the county and $11,500 per year to the city. Starkville aldermen will consider the same request Tuesday evening.
The company is not exempt from paying school district taxes, which Higgins said come in at slightly less than $30,000 per year.
Miller, with some agreement from other supervisors, said she felt the county should look into creating a set of standards for handling tax exemptions, and asked County Administrator Emily Garrard to look at standards other counties use as possible examples.
"We need to come up with a standard procedure for what we're going to do," Miller said. "That way we know, and you know and other industries in the community don't come and say, 'How come you did for this one but you didn't do it for us?'"
In other business, supervisors voted to de-obligate county money that had been set aside to pave Longview Road, due to a lack of federal funding for the project.
The project, which has long been a goal for supervisors, was approved by Office of State Aid Road Construction in July 2016 at an initial cost of $3.8 million. Oktibbeha County obligated $250,000 for the project, with $457,460 in matching State Aid funds.
However, the estimated cost has grown to more than $5 million, and due to an apparent lack of federal Surface Transportation Program (STP) funding, supervisors approved allowing the money to be de-obligated and used elsewhere in the county. According to a letter from the Board of Supervisors to the Office of State Aid Road Construction, the county's expected contribution would exceed more than $2 million, which is funding the county does not have to spare.
District 1 Supervisor John Montgomery, who shares Longview Road with Miller, said the delay was frustrating. However, he said state aid money has to be used by the end of the current term, which ends next year, and cannot carry over between terms.
"If this money could be carried over, we could keep it and add to it next term," he said. "But when the state puts money up, they expect it to be put down in a road that term."
Still, Montgomery said supervisors will continue to seek funding for Longview Road, which he said is basically "shovel ready" when the county has money for the project in hand.
Miller said it made sense to use the money elsewhere, rather than let it expire.
"If we do not use our state aid money, during this term, we'll lose it," she said. "It made sense to withdraw the request and use the money on other roads. He's (Montgomery) going to work on County Lake Road and I'm going to work on Poorhouse Road."
2. City gives ultimatum to storm-stricken homeowners on Northside COLUMBUS & LOWNDES COUNTY
3. One person airlifted to hospital after being pinned under overturned vehicle COLUMBUS & LOWNDES COUNTY
4. Caledonia to install LED lights at two soccer fields COLUMBUS & LOWNDES COUNTY
5. Former MSU vet student, instructor files suit for wrongful termination STARKVILLE & OKTIBBEHA COUNTY