The Columbus City Council approved a resolution Tuesday for an agreement with a local company to take care of more than $70,000 in back taxes and late note payments on its property.
City Attorney Jeff Turnage said the city and Golden Triangle Development LINK worked on the agreement, which would see American Power Source Inc., a clothing manufacturer, pay $47,373 in back ad valorem taxes — owed to the city, Lowndes County and the city school district — as well as $29,218 in delinquent note payments on the property. In exchange, the city agreed to forgive the remaining roughly $80,000 the company owes on the property note.
The city financed the 2009 sale of the property to the company.
The council approved the measure on a 5-1 vote, with Ward 4 Councilman Marty Turner opposing.
American Power Source, located at 826 17th Ave. S., is a clothing manufacturer that makes U.S. military uniforms. Its corporate headquarters is in Massachusetts. Its Columbus location employs 151 people.
American Power Source President Roxanne Ferreiro approached the LINK to seek assistance with the company’s owed taxes and note payments, Turnage said. After several conversations, the city and LINK agreed with the company on terms to recommend to the council.
“If they could do all that my March 21, the city would be agreeable to letting them deed that property back to the city,” Turnage said. “In exchange for that, the city would then cancel the deed of trust and return the property to them with a reverter clause if they fail to live up to the terms of the agreement.”
The terms of the new agreement require American Power Source to employ at least 30 people each month for the next five years. The company would have to pay the city $1,000 for any month that employment dips below 30.
The city received the property where American Power Source is located in 2003 from the Columbus-Lowndes Economic Development Agency, the LINK’s predecessor. That same year, the city leased the property to American Power Source for five years. In 2009, the city sold and financed the land to the company for $198,000. However, the company has struggled to keep up with payments.
“In the past three to four years,” the resolution says, “APSI has unfortunately experienced a substantial reduction in orders and sales volume for U.S. military uniforms that it produces due, at least in part, to a shift in the production of such uniforms to U.S. prisons.”
Because of slumping production, American Power Source has missed several note payments and ad valorem tax payments for 2014-16. The resolution notes a “substantial likelihood” the company would fail to make the remaining note payments.
“The taxes have been paid, and we will be paying the final note by the 21st of March,” Ferreiro said. “I thank everybody who made this consideration.”
Though state law typically doesn’t allow municipalities to sell public land to private entities for less than its appraised value, Turnage said Mississippi Code 57-7-1 does allow cities to set aside, sell or lease surplus property for industrial or commercial purposes for less than that value.
Turner opposed the agreement because he said he didn’t feel it was in the best interest of his ward or the city as a whole. He encouraged people to research the company and agreement, and said he felt more people should have been involved before the final decision.
“It could have been much better if more people were involved for the disclosure of what was going on,” Turner said. “It could have been much better. I don’t just necessarily disagree with everything, but if we would have had a better deal, then I would have went along with it.
“It seems like the government is leaving the ordinary people out of the discussion, and their representatives are just voting just to vote,” he added.
Alex Holloway was formerly a reporter with The Dispatch.
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