Wilson: $274 Million Incentive Package Took 5 Hours From Soup To Nuts

By Steve Wilson, MississippiWatchdog.org, February 11, 2016


It took all of five hours for the Mississippi Legislature last week to receive, consider and approve a measure providing $274 million in taxpayer-funded debt and related tax breaks to help build a tire plant in western Hinds County and a shipyard in Gulfport.

For those keeping score at home, that’s $54.8 million per hour. It will take 25 years for taxpayers to pay off the debt on the incentive package.

After only an hour and 15 minutes of debate by the Legislature, Gov. Phil Bryant signed the package into law on Monday. State taxpayers will lend $263 million to Continental Tire to build a $1.4 billion factory employing 2,500 people, and $11 million to Topship, a division of Edison Chouest Offshore, to convert a former Hunter Ingalls facility on Gulfport’s Industrial Seaway into a shipyard employing 1,000. Continental will also receive exemptions on the state’s corporate franchise tax, sales tax and property tax and will build a training facility on the 1,000-acre site with state funds. Also, the Mississippi Public Service Commission authorized the utility Entergy to provide special rates for Continental.

Here’s what happened in the special session called by the governor:

Wednesday, Feb. 3

4 p.m. – Legislators find out about the special session regarding an incentive package for what are called “Project Potter” (the tire plant) and “Project Crawfish” (shipyard). According to state Sen. Hob Bryan (D-Amory), the Legislature is not given copies of the 198-page bill to study until the next morning. The two project companies are not named because of confidentiality agreements.

The Jackson Clarion-Ledger admitted it had known about the possible tire plant deal since 2014, but kept it under wraps. According to the Ledger story, “The Associated Press first reported the details of the projects. The Clarion-Ledger learned of the Continental project in late 2014 and agreed to not publish anything until negotiations were complete so as not to threaten the deal.”

The AP denied it had any concrete knowledge of the deal until last week and didn’t have an agreement with the state to keep the deal a secret due to confidentiality concerns.

Related: Zombie incentives still eating Mississippi taxpayers alive

Thursday, Feb. 4

8 a.m. – House Speaker Philip Gunn (R-Clinton) gavels the special session into order.

8:10 a.m. – House Ways and Means Committee Chairman Jeff Smith (R-Columbus) tells his committee that the incentives have some of the strongest clawbacks, which are based on job creation requirements and would give the state the ability to recover its money. He admits there have been some “hiccups” in economic incentives before, but that these incentives are rock solid. After some questions about the land, which would be part of a swap with the Clinton School District, and an amendment giving preference for minority-owned contractors, the committee approves the measure and sends it to the full House.

8:45 a.m. – After Smith describes the bill on the floor, state Rep. Joel Bomgar (R-Madison) is the only member to have any questions. He asks why the Legislature should approve such generous incentives for one business and not for another. Smith’s reply is basically that the two companies, who still can’t be named at this point, asked for help. A vote is called and only Bomgar, William Shirley (R-Quitman) and Steve Horne (R-Meridian) vote no.

9:30 a.m. – Lt. Gov. Tate Reeves convenes the Senate to consider HB1.

10 a.m.- In the Senate Finance Committee, state Sen. Michael Watson (R-Pascagoula) has some questions about the breakdown of how and when the incentives will be awarded. Then Bryan takes the microphone and questions Mississippi Development director Glenn McCullough and Mississippi State Institutions of Higher Learning senior economist Bob Neal for more than an hour on economic impact studies regarding the projects and their methodology, past economic incentives and their impact, and when the facilities would begin generating revenue for the state’s general fund. He also criticizes the rush to get the package passed, pointing out that he and others hadn’t had enough time to study its contents. But Bryan ultimately votes for the package.

1:15 p.m. – The bill is taken up by the full Senate and only state Sens. Chris McDaniel (R-Laurel), Deborah Dawkins (D-Pass Christian) and John Polk (R-Hattiesburg) vote no. The bill is sent to the governor for his signature.

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  1. State-sponsored Crony Capitalism has been around since the days of Adam Smith. The REAL ISSUE the article raises is: “how can the Legislature fully vet the deals in question in one morning’s time?” Everyone wants to trust the wisdom, judgement, and assurances of the representatives of the MDA. However, these folks are not accountable to the people of Mississippi if the businesses don’t produce the anticipated benefits, or worse, the deals fail and the taxpayers are left holding the bag.


  1. […] First, Senator McDaniel had major concerns with the secrecy behind the deal. He didn’t receive a copy of the 200-page bill until the morning of the vote. It would have been reckless to support the bill without time to read and research it. In fact, the whole deal from birth to final passage took all of five hours. […]

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