MISSISSIPPI LEGISLATURE
2020 Regular Session
To: Economic and Workforce Development
By: Senator(s) Parker, Blount, Branning, Jackson (11th), Boyd, Younger, Sparks, England, Blackwell, Jackson (32nd), Simmons (13th), Carter, McLendon, Frazier, Tate, Simmons (12th), Butler, Chism, Norwood, McDaniel
AN ACT TO CREATE "THE INCENTIVES TRANSPARENCY FOR A PROSPEROUS MISSISSIPPI ACT"; TO DEFINE TERMS; TO SET INITIAL REQUIREMENTS FOR THE AWARDING OF AN ECONOMIC INCENTIVE BY THE MISSISSIPPI DEVELOPMENT AUTHORITY TO A CERTIFIED APPLICANT FOR A QUALIFIED ECONOMIC DEVELOPMENT PROJECT, INCLUDING A FINDING BY THE AUTHORITY THAT THE PROJECT IS IN THE BEST INTERESTS OF THE STATE; TO REQUIRE THAT A CERTIFIED APPLICANT AWARDED AN ECONOMIC INCENTIVE ENTER INTO A MEMORANDUM OF UNDERSTANDING WITH THE STATE THROUGH THE AUTHORITY, CONTAINING PERFORMANCE MEASURES FOR ATTAINMENT WITHIN A PERIOD OF TIME DETERMINED BY THE MDA; TO PROVIDE THAT FAILURE TO MEET THE MEASURES WILL DISQUALIFY AN APPLICANT FROM THE AWARD OF AN ECONOMIC INCENTIVE FOR FIVE YEARS OR UNTIL THE RECIPIENT EITHER CURES THE DEFAULT OR REPAYS THE INCENTIVE, WHICHEVER OCCURS FIRST; TO REQUIRE THAT A CERTIFIED APPLICANT FILE AN ANNUAL REPORT WITH THE AUTHORITY FOR ANY QUALIFIED ECONOMIC DEVELOPMENT PROJECT FOR THE TAX YEAR ENDING DURING THE IMMEDIATELY PRECEDING CALENDAR YEAR; TO SPECIFY THE CONTENT OF THE CERTIFIED APPLICANT'S ANNUAL REPORT; TO REQUIRE THAT THE EXECUTIVE DIRECTOR OF THE AUTHORITY FILE A REPORT WITH THE STATE CONTAINING DATA FOR EACH YEAR THAT THE CERTIFIED APPLICANT RECEIVED AN ECONOMIC INCENTIVE; TO SPECIFY THE CONTENT OF THE AUTHORITY'S ANNUAL REPORT; TO CLARIFY THAT SECTIONS 2 THROUGH 6 OF THIS ACT APPLY ONLY TO CERTIFIED APPLICANTS FOR ECONOMIC INCENTIVES AWARDED AFTER JULY 1, 2020, WITH APPLICANTS AWARDED ECONOMIC INCENTIVES BEFORE THAT DATE HAVING THE OPTION OF FILING THE APPLICABLE INFORMATION VOLUNTARILY; TO AMEND SECTION 57-1-14, MISSISSIPPI CODE OF 1972, TO EXCLUDE FROM CONFIDENTIALITY INFORMATION REQUIRED TO BE INCLUDED IN THE ANNUAL REPORT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Short title. Sections 1 through 6 of this act shall be known and may be cited as the "Incentives Transparency for a Prosperous Mississippi Act."
SECTION 2. Definitions. For purposes of Sections 2 through 6 of this act, the following words shall have the meanings ascribed herein unless the context otherwise requires:
(a) "Certified applicant" or "applicant" means any privately owned corporation, partnership, company or other for-profit business enterprise or any individual receiving one or more economic incentives worth, in total, in excess of Five Million Dollars ($5,000,000.00).
(b) "Economic incentive" or "incentive" means any grants and/or loans awarded by the department to the certified applicant, and in exchange the certified applicant agrees to take some action that contributes to economic development.
(c) "Qualified economic development project" means a business or other economic development project receiving one or more economic incentives worth, in total, in excess of Five Million Dollars ($5,000,000.00).
(d) "Full-time employee" means an individual who is employed for consideration for an average of at least thirty-five (35) hours each week or who renders any other standard of service generally accepted by custom or specified by contract as full-time employment.
(e) "Part-time employee" means an individual who is employed for consideration for an average of less than thirty-five (35) hours each week or who renders any other standard of service generally accepted by custom or specified by contract as part-time employment.
(f) "Employee of a temporary employment agency" means an individual who is hired by a temporary employment agency providing temporary or contract jobs, where the individual performing the work is either an independent contractor or an employee of the temporary employment agency, rather than an employee of the certified applicant or qualified economic development project receiving an economic incentive.
(g) "New employee" means a full-time employee first employed by a certified applicant after the applicant enters into an agreement to receive the economic incentive.
(h) "Annual report" means the report described in Section 5 of this act.
SECTION 3. Initial requirements. (1) The awarding of an economic incentive to a certified applicant is contingent on a finding by the department that the applicant's qualified economic development project, including, but not limited to, the retention, expansion or location of the applicant's business is clearly in the best interests of this state. This finding shall be contained in a resolution adopted by the department. The resolution shall set forth the evidence and reasons supporting this finding, including, but not limited to:
(a) Supporting evidence such as a feasibility study, market trends or other data demonstrating that the qualified economic development project will reach the department's stated goal of the economic incentive;
(b) The general impact the qualified economic development project will have on the statewide and local economy and community;
(c) The number of full-time, part-time or temporary jobs the qualified economic development project is expected to bring in to the statewide economy;
(d) Information on direct and indirect public and private costs of the qualified economic development project; and
(e) Negative effects from the qualified economic development project, and the assumptions on which the information is based.
(2) The department shall share the resolution and supporting evidence described in this section with the University Research Center and, upon request, with the Governor, Speaker of the House and President of the Senate.
SECTION 4. Performance measures. (1) A certified applicant awarded an economic incentive shall enter into a memorandum of understanding with the state through the department. The memorandum shall contain performance measures, determined by the department, that the applicant's qualified economic development project is expected to meet within a specified period of time determined by the department after the incentive is awarded. The performance measures shall align with the department's resolution and supporting evidence for the certified applicant's qualified economic development project as described in Section 3 of this act. The memorandum shall contain provisions allowing the state, through the department or the State Auditor's office, to stop, readjust or recapture all or part of the economic incentive given to the applicant on noncompliance with the terms of the memorandum.
(2) A certified applicant that fails to meet performance measures as described in this section may not receive or be awarded an economic incentive from the department for a period of five (5) years from the date of the notice of default by the department, or until a recipient either cures such default in accordance with the agreement prescribed in subsection (1) of this section, or satisfies the repayment of the economic incentive, whichever occurs first. For purposes of this subsection (2), if the applicant is an individual, the disqualification attaches to the individual, and if the applicant is a business entity, the disqualification attaches to the entity and to each owner or shareholder of twenty percent (20%) or more of the business.
SECTION 5. Annual report. (1) On or before March 1 of each year, a certified applicant shall file an annual report with the department for any qualified economic development project for the tax year ending during the immediately preceding calendar year, referred to in this paragraph as "the report year," containing the following information:
(a) The name and county of operation of the recipient;
(b) The amount of the economic incentive awarded to the certified applicant;
(c) The purpose of the economic incentive;
(d) The number of full-time employees, part-time employees and employees of a temporary employment agency that the certified applicant agreed to hire, retain or train when the economic incentive was awarded;
(e) The amount of the investment the certified applicant expects to make in the state as a result of the qualified economic development project;
(f) The number of all full-time employees, part-time employees and employees of a temporary employment agency employed by the certified applicant and based in the state on the last day of the report year;
(g) The incremental amount of qualified investment made in the report year;
(h) The average and median wages of all additional full-time employees and part-time employees above the certified applicant's base level of employment in the state whose jobs were added since the first day of the first tax year in which the economic incentive was awarded;
(i) The percentage and number of all additional full-time employees and part-time employees above the certified applicant's base level of employment who have access to retirement benefits and health benefits; and
(j) The number of Mississippi-based companies included in the certified applicant's supply chain.
(2) The department may prescribe forms for the annual report.
(3) By October 1 of each year, the executive director of the department shall file a report with the Governor, the Speaker of the House, the President of the Senate, the Joint Legislative Budget Committee and the members of the committees in the Mississippi House and Senate having jurisdiction over taxation matters, containing data on employment levels, wages and other information described in this section and reported by certified applicants to the department, for each year that the applicant received an economic incentive. In addition to the data on individual qualified economic development projects, the report shall contain the following aggregate information:
(a) The total amount of incentives approved or awarded;
(b) The total amount of loans made by the department;
(c) The total amount of grants awarded by the department;
(d) A description of standard terms for each loan program;
(e) A list of projects that have met contractual requirements and have been closed out by the department.
(4) The Department of Revenue shall provide the department with the tax information required to be included in this report.
SECTION 6. Limitations. Sections 2 through 6 of this act shall apply only to certified applicants for economic incentives awarded by the department after July 1, 2020. Applicants awarded economic incentives prior to July 1, 2020, may file the applicable information voluntarily.
SECTION 7. Section 57-1-14, Mississippi Code of 1972, is amended as follows:
57-1-14.
(1) Any records of the * * * Department of Economic and Community Development Mississippi
Development Authority which contain client information concerning development
projects shall be exempt from the provisions of the Mississippi Public Records
Act of 1983 for a period of two (2) years after receipt of the information by
the department. Confidential client information as described in this
section shall not include the information which must be disclosed by the
certified applicant related to a qualified economic development project in the
annual report described in Section 5 of this act.
(2) Confidential client information in public records held by the department shall be exempt from the provisions of the Mississippi Public Records Act of 1983 during the period of review and negotiation on a project proposal and for a period of thirty (30) days after approval, disapproval or abandonment of the proposal not to exceed one (1) year by the department in writing.
SECTION 8. Sections 1 through 6 of this act shall be codified in Title 57, Chapter 1, Mississippi Code of 1972.
SECTION 9. This act shall take effect and be in force from and after July 1, 2020.