Bill Text: MS HB871 | 2023 | Regular Session | Engrossed
Bill Title: Ad valorem tax; extend time for partial exemption and fee-in-lieu of ad valorem tax agreement for certain renewable energy projects.
Spectrum: Slight Partisan Bill (Democrat 2-1)
Status: (Failed) 2023-03-14 - Died In Committee [HB871 Detail]
Download: Mississippi-2023-HB871-Engrossed.html
MISSISSIPPI LEGISLATURE
2023 Regular Session
To: Ways and Means
By: Representatives Reynolds, Stamps
House Bill 871
(As Passed the House)
AN ACT TO AMEND SECTION 27-31-46.1, MISSISSIPPI CODE OF 1972, TO EXTEND THE PERIOD IN WHICH CERTAIN RENEWABLE ENERGY PROJECTS MAY BEGIN CONSTRUCTION IN ORDER TO BE ELIGIBLE FOR A PARTIAL AD VALOREM TAX EXEMPTION; TO EXTEND THE TIME PERIOD WITHIN WHICH COUNTY BOARDS OF SUPERVISORS AND MUNICIPAL GOVERNING AUTHORITIES MAY AUTHORIZE A PARTIAL AD VALOREM TAX EXEMPTION FOR CERTAIN RENEWABLE ENERGY PROJECTS; TO AMEND SECTION 27-31-104, MISSISSIPPI CODE OF 1972, WHICH AUTHORIZES COUNTY BOARDS OF SUPERVISORS AND MUNICIPAL GOVERNING AUTHORITIES TO ENTER INTO AGREEMENTS WITH CERTAIN ENTERPRISES GRANTING A FEE-IN-LIEU OF AD VALOREM TAXES, TO REVISE THE ENTERPRISES WITH WHICH COUNTY BOARDS OF SUPERVISORS AND MUNICIPAL GOVERNING AUTHORITIES ARE AUTHORIZED TO ENTER INTO SUCH AGREEMENTS; TO EXTEND THE TIME PERIOD WITHIN WHICH COUNTY BOARDS OF SUPERVISORS AND MUNICIPAL GOVERNING AUTHORITIES MAY ENTER INTO SUCH AGREEMENTS WITH CERTAIN RENEWABLE ENERGY PROJECTS; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-31-46.1, Mississippi Code of 1972, is amended as follows:
27-31-46.1. A project that is
eligible for an ad valorem tax exemption under Section 27-31-46, and for which initial
construction begins on or after July 1, 2022, but not later than December 31, * * * 2027, may be allowed an exemption from
ad valorem taxation as provided in this section. For such a project, one-half (1/2)
of the true value of property of the project that is subject to a fee-in-lieu of
ad valorem taxes pursuant to an agreement under Section 27-31-104 may be exempted
by a county board of supervisors and/or municipal governing authorities from ad
valorem taxation for a period of ten (10) years from and after the date of the expiration
of such fee-in-lieu of ad valorem taxes. Any exemption from ad valorem taxation
allowed under this section must be authorized by a county board of supervisors and/or
municipal governing authorities before July 1, * * * 2026.
SECTION 2. Section 27-31-104, Mississippi Code of 1972, is amended as follows:
[Through June 30, 2025, this section shall read as follows:]
27-31-104. (1) (a) County boards of supervisors and municipal authorities are each hereby authorized and empowered to enter into an agreement with an enterprise granting, and pursuant to such agreement grant a fee-in-lieu of ad valorem taxes, including ad valorem taxes levied for school purposes, for the following:
(i) Projects totaling over Sixty Million Dollars ($60,000,000.00) by any new enterprises enumerated in Section 27-31-101;
(ii) Projects by a private company (as such term is defined in Section 57-61-5) having a minimum capital investment of Sixty Million Dollars ($60,000,000.00);
(iii) Projects by a qualified business (as such term is defined in Section 57-117-3) meeting minimum criteria established by the Mississippi Development Authority;
(iv) Projects, in addition to those projects referenced in Section 27-31-105, totaling over Sixty Million Dollars ($60,000,000.00) by an existing enterprise that has been doing business in the county or municipality for twenty-four (24) months. For purposes of this subparagraph (iv), the term "existing enterprise" includes those enterprises enumerated in Section 27-31-101; or
(v) A private company (as such term is defined in Section 57-61-5) or entity as defined in Section 77-3-3(d)(i) having a minimum capital investment of One Hundred Million Dollars ($100,000,000.00) from any source or combination of sources, provided that a majority of the capital investment is from private sources, when such project is located within a geographic area for which a Presidential Disaster Declaration was issued on or after January 1, 2014.
(b) A fee-in-lieu of ad valorem taxes granted in accordance with this section may include any or all tangible property, real or personal, including any leasehold interests therein but excluding automobiles and trucks operating on and over the highways of the State of Mississippi, used in connection with, or necessary to, the operation of any enterprise, private company or business described in paragraph (a) of this subsection (1), as applicable, whether or not such property is owned, leased, subleased, licensed or otherwise obtained by such enterprise, private company or business, as applicable, irrespective of the taxpayer to which any such leased property is assessed for ad valorem tax purposes. If a fee-in-lieu of ad valorem taxes is granted pursuant to this section with respect to any leasehold interest under a lease, sublease or license of tangible property used in connection with, or necessary to, the operation of an enterprise, private company or business described in paragraph (a) of this subsection (1), as applicable, the corresponding ownership interest of the owner, lessor and sublessor of such tangible property shall similarly and automatically be exempt and subject to the fee-in-lieu granted in accordance herewith without any action being required to be taken by such owner, lessor or sublessor.
(2) A county board of supervisors may enter into a fee-in-lieu agreement on behalf of the county and any county school district, and a municipality may enter into such a fee-in-lieu agreement on behalf of the municipality and any municipal school district located in the municipality; however, if the project is located outside the limits of a municipality but within the boundaries of the municipal school district, then the county board of supervisors may enter into such a fee-in-lieu agreement on behalf of the school district granting a fee-in-lieu of ad valorem taxes for school district purposes.
(3) Any grant of a fee-in-lieu of ad valorem taxes shall be evidenced by a written agreement negotiated by the enterprise and the county board of supervisors and/or municipal authority, as the case may be, and given final approval by the Mississippi Development Authority as satisfying the requirements of this section.
(4) The minimum sum allowable
as a fee-in-lieu shall not be less than one-third (1/3), or one-tenth (1/10) if
the project is also a project eligible for an ad valorem tax exemption under Section
27-31-46 and a fee-in-lieu agreement is entered into before July 1, * * * 2026, of the ad valorem levy, including
ad valorem taxes for school district purposes, and except as otherwise provided,
the sum allowed shall be apportioned between the county or municipality, as appropriate,
and the school districts in such amounts as may be determined by the county board
of supervisors or municipal governing authority, as the case may be, however, except
as otherwise provided in this section, from the sum allowed the apportionment to
school districts shall not be less than the school districts' pro rata share based
upon the proportion that the millage imposed for the school districts by the appropriate
levying authority bears to the millage imposed by such levying authority for all
other county or municipal purposes. Any fee-in-lieu agreement entered into under
this section shall become a binding obligation of the parties to the agreement,
be effective upon its execution by the parties and approval by the Mississippi Development
Authority and, except as otherwise provided in Section 17-25-23 or Section 57-75-33,
or any other provision of law, continue in effect for a period not to exceed thirty
(30) years commencing on the date that the fee-in-lieu granted thereunder begins
in accordance with the agreement; however, no particular parcel of land, real property
improvement or item of personal property shall be subject to a fee-in-lieu for a
duration of more than ten (10) years. Any such agreement shall be binding, according
to its terms, on future boards of supervisors of the county and/or governing authorities
of a municipality, as the case may be, for the duration of the agreement.
(5) The fee-in-lieu may be a
stated fraction or percentage of the ad valorem taxes otherwise payable or a stated
dollar amount. If the fee is a fraction or percentage of the ad valorem tax levy,
it shall be annually computed on all ad valorem taxes otherwise payable, including
school taxes, as the same may vary from year to year based upon changes in the millage
rate or assessed value and shall not be less than one-third (1/3) of that amount
or one-tenth (1/10) of that amount if the project is also a project eligible for
an ad valorem tax exemption under Section 27-31-46 and a fee-in-lieu agreement is
entered into before July 1, * * * 2026. If the fee is a stated dollar
amount, said amount shall be the higher of the sum provided for fixed payment or
(a) one-third (1/3) of the total of all ad valorem taxes otherwise payable as annually
determined during each year of the fee-in-lieu or (b) if the project is also a project
eligible for an ad valorem tax exemption under Section 27-31-46 and a fee-in-lieu
agreement is entered into before July 1, * * * 2026, one-tenth (1/10) of the total
of all ad valorem taxes otherwise payable as annually determined during each year
of the fee-in-lieu.
(6) Notwithstanding Section 27-31-111, the parties to a fee-in-lieu may agree on terms and conditions providing for the reduction, suspension, termination or reinstatement of a fee-in-lieu agreement or any fee-in-lieu period granted thereunder upon the cessation of operations by project for twelve (12) or more consecutive months or due to other conditions set forth in the agreement.
(7) For a project as defined in Section 57-75-5(f)(xxi) and located in a county that is a member of a regional economic development alliance created under Section 57-64-1 et seq., the members of the regional economic development alliance may divide the sum allowed as a fee-in-lieu in a manner as determined by the alliance agreement, and the boards of supervisors of the member counties may then apportion the sum allowed between school district purposes and all other county purposes.
(8) For a project as defined in Section 57-75-5(f)(xxvi), the board of supervisors of the county in which the project is located may negotiate with the school district in which the project is located and apportion to the school district an amount of the fee-in-lieu that is agreed upon in the negotiations different than the amount provided for in subsection (3) of this section.
(9) For a project as defined in Section 57-75-5(f)(xxviii), the annual amount of the fee-in-lieu apportioned to the county shall not be less than the amount necessary to pay the debt service on bonds issued by the county pursuant to Section 57-75-37(3)(c).
(10) Any fee-in-lieu of ad valorem taxes granted under this section before March 28, 2019, and consistent herewith, is hereby ratified, approved and confirmed.
[From and after July 1, 2025, this section shall read as follows:]
27-31-104. (1) (a) County boards of supervisors and municipal authorities are each hereby authorized and empowered to enter into an agreement with an enterprise granting, and pursuant to such agreement grant a fee-in-lieu of ad valorem taxes, including ad valorem taxes levied for school purposes, for the following:
(i) Projects totaling over Sixty Million Dollars ($60,000,000.00) by any new enterprises enumerated in Section 27-31-101;
(ii) Projects by a private company (as such term is defined in Section 57-61-5, Mississippi Code of 1972) having a minimum capital investment of Sixty Million Dollars ($60,000,000.00);
(iii) Projects, in addition to those projects referenced in Section 27-31-105, totaling over Sixty Million Dollars ($60,000,000.00) by an existing enterprise that has been doing business in the county or municipality for twenty-four (24) months. For purposes of this subparagraph (iii), the term "existing enterprise" includes those enterprises enumerated in Section 27-31-101; or
(iv) A private company (as such term is defined in Section 57-61-5) or entity as defined in Section 77-3-3(d)(i) having a minimum capital investment of One Hundred Million Dollars ($100,000,000.00) from any source or combination of sources, provided that a majority of the capital investment is from private sources, when such project is located within a geographic area for which a Presidential Disaster Declaration was issued on or after January 1, 2014.
County boards of supervisors and municipal authorities may not enter into an agreement with an enterprise that is a medical cannabis establishment, as defined in the Mississippi Medical Cannabis Act, granting, and pursuant to such agreement grant a fee-in-lieu of ad valorem taxes.
(b) A fee-in-lieu of ad valorem taxes granted in accordance with this section may include any or all tangible property, real or personal, including any leasehold interests therein but excluding automobiles and trucks operating on and over the highways of the State of Mississippi, used in connection with, or necessary to, the operation of any enterprise, private company or business described in paragraph (a) of this subsection (1), as applicable, whether or not such property is owned, leased, subleased, licensed or otherwise obtained by such enterprise, private company or business, as applicable, irrespective of the taxpayer to which any such leased property is assessed for ad valorem tax purposes. If a fee-in-lieu of ad valorem taxes is granted pursuant to this section with respect to any leasehold interest under a lease, sublease or license of tangible property used in connection with, or necessary to, the operation of an enterprise, private company or business described in paragraph (a) of this subsection (1), as applicable, the corresponding ownership interest of the owner, lessor and sublessor of such tangible property shall similarly and automatically be exempt and subject to the fee-in-lieu granted in accordance herewith without any action being required to be taken by such owner, lessor or sublessor.
(2) A county board of supervisors may enter into a fee-in-lieu agreement on behalf of the county and any county school district, and a municipality may enter into such a fee-in-lieu agreement on behalf of the municipality and any municipal school district located in the municipality; however, if the project is located outside the limits of a municipality but within the boundaries of the municipal school district, then the county board of supervisors may enter into such a fee-in-lieu agreement on behalf of the school district granting a fee-in-lieu of ad valorem taxes for school district purposes.
(3) Any grant of a fee-in-lieu of ad valorem taxes shall be evidenced by a written agreement negotiated by the enterprise and the county board of supervisors and/or municipal authority, as the case may be, and given final approval by the Mississippi Development Authority as satisfying the requirements of this section.
(4) The minimum sum allowable
as a fee-in-lieu shall not be less than one-third (1/3), or one-tenth (1/10) if
the project is also a project eligible for an ad valorem tax exemption under Section
27-31-46 and a fee-in-lieu agreement is entered into before July 1, * * * 2026, of the ad valorem levy, including
ad valorem taxes for school district purposes, and except as otherwise provided,
the sum allowed shall be apportioned between the county or municipality, as appropriate,
and the school districts in such amounts as may be determined by the county board
of supervisors or municipal governing authority, as the case may be, however, except
as otherwise provided in this section, from the sum allowed the apportionment to
school districts shall not be less than the school districts' pro rata share based
upon the proportion that the millage imposed for the school districts by the appropriate
levying authority bears to the millage imposed by such levying authority for all
other county or municipal purposes. Any fee-in-lieu agreement entered into under
this section shall become a binding obligation of the parties to the agreement,
be effective upon its execution by the parties and approval by the Mississippi Development
Authority and, except as otherwise provided in Section 17-25-23 or Section 57-75-33,
or any other provision of law, continue in effect for a period not to exceed thirty
(30) years commencing on the date that the fee-in-lieu granted thereunder begins
in accordance with the agreement; however, no particular parcel of land, real property
improvement or item of personal property shall be subject to a fee-in-lieu for a
duration of more than ten (10) years. Any such agreement shall be binding, according
to its terms, on future boards of supervisors of the county and/or governing authorities
of a municipality, as the case may be, for the duration of the agreement.
(5) The fee-in-lieu may be a
stated fraction or percentage of the ad valorem taxes otherwise payable or a stated
dollar amount. If the fee is a fraction or percentage of the ad valorem tax levy,
it shall be annually computed on all ad valorem taxes otherwise payable, including
school taxes, as the same may vary from year to year based upon changes in the millage
rate or assessed value and shall not be less than one-third (1/3) of that amount
or one-tenth (1/10) of that amount if the project is also a project eligible for
an ad valorem tax exemption under Section 27-31-46 and a fee-in-lieu agreement is
entered into before July 1, * * * 2026. If the fee is a stated dollar
amount, said amount shall be the higher of the sum provided for fixed payment or
(a) one-third (1/3) of the total of all ad valorem taxes otherwise payable as annually
determined during each year of the fee-in-lieu or (b) if the project is also a project
eligible for an ad valorem tax exemption under Section 27-31-46 and a fee-in-lieu
agreement is entered into before July 1, * * * 2026, one-tenth (1/10) of the total
of all ad valorem taxes otherwise payable as annually determined during each year
of the fee-in-lieu.
(6) Notwithstanding Section 27-31-111, the parties to a fee-in-lieu may agree on terms and conditions providing for the reduction, suspension, termination or reinstatement of a fee-in-lieu agreement or any fee-in-lieu period granted thereunder upon the cessation of operations by project for twelve (12) or more consecutive months or due to other conditions set forth in the agreement.
(7) For a project as defined in Section 57-75-5(f)(xxi) and located in a county that is a member of a regional economic development alliance created under Section 57-64-1 et seq., the members of the regional economic development alliance may divide the sum allowed as a fee-in-lieu in a manner as determined by the alliance agreement, and the boards of supervisors of the member counties may then apportion the sum allowed between school district purposes and all other county purposes.
(8) For a project as defined in Section 57-75-5(f)(xxvi), the board of supervisors of the county in which the project is located may negotiate with the school district in which the project is located and apportion to the school district an amount of the fee-in-lieu that is agreed upon in the negotiations different than the amount provided for in subsection (3) of this section.
(9) For a project as defined in Section 57-75-5(f)(xxviii), the annual amount of the fee-in-lieu apportioned to the county shall not be less than the amount necessary to pay the annual debt service on bonds issued by the county pursuant to Section 57-75-37(3)(c).
(10) Any fee-in-lieu of ad valorem taxes granted under this section before March 28, 2019, and consistent herewith, is hereby ratified, approved and confirmed.
SECTION 3. This act shall take effect and be in force from and after July 1, 2023.
