One tool that the cities and counties have to recruit businesses to their area is to grant a company a fee-in-lieu of taxes agreement, which reduces property taxes for a certain period of time. By law, local governing authorities can only enter into a fee-in-lieu agreement with a new project whose aggregate investment is $100 million or more. With several of our surrounding states having a much lower fee-in-lieu threshold, Mississippi has missed out on a number of economic development projects over the years whose investment would have been significant, but did not reach $100 million.
“Economic Development is hyper-competitive. This new legislation will provide local communities the means, should they choose, to support public improvements related to large economic development projects while relying less on diminishing discretionary incentives from the state.”
– William “Skip” Scaggs, Executive Director, North Mississippi Industrial Development Association
During the 2018 legislative session, lawmakers, the MMA and other economic development organizations made it a priority to lower the investment amount needed to qualify for a fee-in-lieu agreement. After some debate about what the threshold amount should be, Senate Bill 2479 passed the Legislature lowering the amount to $60 million. Additionally, SB 2479 allows the local governing authorities to enter into fee-in-lieu agreements with existing industries in their area that are looking to expand. These existing companies must have been doing business in the area for at least 24 months and meet the $60 million investment threshold. This legislation is an important step towards giving communities more leverage in recruiting companies to their areas and helping their existing companies grow.
The MMA would like to especially thank Senate Finance Chairman Joey Fillingane and House Ways and Means Chairman Jeff Smith, for championing this effort. It is essential that the Legislature continue to act on legislation that will grow Mississippi businesses, create jobs and bolster the state’s economy.
Gov. Phil Bryant signed SB 2479 into law on May 3, 2018.
It will go into effect July 1, 2018.
L-R: Mary Swoope, Mississippi Economic Development Council; Robbie Brown, Mississippi Municipal League;
Mitch Stringer, Cooperative Energy; Greg Word, Greater Jackson Alliance; Mandi Arinder, Rankin County
Chamber of Commerce; Skip Scaggs, North Mississippi Industrial Development Association; Cary Karlson,
Washington County Economic Alliance; Kelly Wright, MMA; Scott Waller, Mississippi Economic Council;
Jamie Miller, Mississippi Development Authority (MDA); and Glenn McCullough, MDA