MISSISSIPPI LEGISLATURE
2024 Regular Session
To: Finance
By: Senator(s) Parker, Blackwell, McLendon
AN ACT TO AMEND SECTIONS 27-31-7, 27-31-101 AND 27-31-105 AND 27-31-107, MISSISSIPPI CODE OF 1972, TO AUTHORIZE COUNTIES AND MUNICIPALITIES TO EXEMPT FROM AD VALOREM TAXATION, EXCEPT AD VALOREM TAXES FOR SCHOOL DISTRICT PURPOSES, THE VALUE OF RAW MATERIALS AND WORK-IN-PROGRESS INVENTORY; TO RATIFY ANY SUCH EXEMPTION FROM AD VALOREM TAXES GRANTED BEFORE JULY 1, 2024; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-31-7, Mississippi Code of 1972, is amended as follows:
27-31-7. (1) The board of supervisors of any county or the governing authority of any municipality is hereby authorized and empowered, in its discretion, to exempt from ad valorem taxation, excepting ad valorem taxes for school district purposes, all or any portion of the value of the products, including raw materials, work-in-progress and finished goods inventory, owned by or remaining in the hands of any manufacturer, or its subsidiary, or any distributor or wholesale merchant, located within such county or municipality. The time of such exemption shall be for a period not to exceed a total of ten (10) years, which shall commence from the date such exemption is granted. Any request for an exemption must be made in writing to the board of supervisors or the municipal governing authority. Any exemption from ad valorem taxes granted under this subsection (1) before July 1, 2024, and consistent herewith is ratified, approved and confirmed.
(2) The exemption granted herein shall be in addition to all other exemptions heretofore granted by the laws of the State of Mississippi.
(3) It is the sense of the Legislature that time limits imposed in Section 182, Mississippi Constitution of 1890, on the terms of certain ad valorem tax exemptions which may be granted to manufacturers and other new enterprises of public utility apply only to the physical plant of such manufacturers and enterprises and to any personal property necessary for the operation thereof; and any exemption for the finished products of such manufacturers and enterprises granted by the governing authorities of any county or municipality under this section after December 31, 1960, but prior to July 1, 1982, shall not be affected by the time limits established in subsequent amendments to this section after July 1, 1982, but shall remain in full force and effect subject to the original terms granted by such governing authorities.
SECTION 2. Section 27-31-101, Mississippi Code of 1972, is amended as follows:
[Through June 30, 2025, this section shall read as follows:]
27-31-101. (1) County boards of supervisors and municipal authorities are hereby authorized and empowered, in their discretion, to grant exemptions from ad valorem taxation, except state ad valorem taxation; however, such governing authorities shall not exempt ad valorem taxes for school district purposes on tangible property used in, or necessary to, the operation of the manufacturers and other new enterprises enumerated by classes in this section, including the projected annual value of raw materials and work-in-progress inventory estimated to be necessary to operate the new enterprise at full capacity during the term of the exemption granted, except to the extent authorized in Sections 27-31-104 and 27-31-105(2), nor shall they exempt from ad valorem taxes the finished products of the manufacturers or other new enterprises or automobiles and trucks belonging to the manufacturers or other new enterprises operating on and over the highways of the State of Mississippi. The time of such exemption shall be for a period not to exceed a total of ten (10) years which shall begin on the date of completion of the new enterprise for which the exemption is granted; however, boards of supervisors and municipal authorities, in lieu of granting the exemption for one (1) period of ten (10) years, may grant the exemption in a period of less than ten (10) years. When the initial exemption period granted is less than ten (10) years, the boards of supervisors and municipal authorities may grant a subsequent consecutive period or periods to follow the initial period of exemption, provided that the total of all periods of exemption shall not exceed ten (10) years. The date of completion of the new enterprise, from which the initial period of exemption shall begin, shall be the date on which operations of the new enterprise begin. The initial request for an exemption must be made in writing by June 1 of the year immediately following the year in which the date of completion of a new enterprise occurs. If the initial request for the exemption is not timely made, the board of supervisors or municipal authorities may grant a subsequent request for the exemption and, in such case, the exemption shall begin on the anniversary date of completion of the enterprise in the year in which the request is made and may be for a period of time extending not more than ten (10) years from the date of completion of the new enterprise. Any subsequent request for the exemption must be made in writing by June 1 of the year in which it is granted.
(2) Any board of supervisors or municipal authority which has granted an exemption for a period of less than ten (10) years may grant subsequent periods of exemption to run consecutively with the initial exemption period, or a subsequently granted exemption period, but in no case shall the total of the exemption periods granted for a new enterprise exceed ten (10) years. Any consecutive period of exemption shall be granted by entry of an order by the board or the authority granting the consecutive exemption on its minutes, reflecting the granting of the consecutive exemption period and the dates upon which such consecutive exemption period begins and expires. The entry of this order granting the consecutive period of exemption shall be made before the expiration of the exemption period immediately preceding the consecutive exemption period being granted.
(3) (a) The new enterprises for which any or all of the tangible property described in paragraph (b) of this subsection (3) may be exempt from ad valorem taxation, except state ad valorem taxation, ad valorem taxes for school district purposes, and ad valorem taxes on the finished products thereof or on automobiles and trucks belonging thereto and operating on and over the highways of the State of Mississippi, are enumerated as and limited to the following, as determined by the Department of Revenue:
(i) Warehouse and/or distribution centers;
(ii) Manufacturing, processors and refineries;
(iii) Research facilities;
(iv) Corporate regional and national headquarters meeting minimum criteria established by the Mississippi Development Authority;
(v) Movie industry studios meeting minimum criteria established by the Mississippi Development Authority;
(vi) Air transportation and maintenance facilities meeting minimum criteria established by the Mississippi Development Authority;
(vii) Recreational facilities that impact tourism meeting minimum criteria established by the Mississippi Development Authority;
(viii) Data/information processing enterprises meeting minimum criteria established by the Mississippi Development Authority;
(ix) Technology intensive enterprises or facilities meeting criteria established by the Mississippi Development Authority;
(x) Health care industry facilities as defined in Section 57-117-3;
(xi) Data centers as defined in Section 57-113-21;
(xii) Telecommunications enterprises meeting minimum criteria established by the Mississippi Development Authority. The term "telecommunications enterprises" means entities engaged in the creation, display, management, storage, processing, transmission or distribution for compensation of images, text, voice, video or data by wire or by wireless means, or entities engaged in the construction, design, development, manufacture, maintenance or distribution for compensation of devices, products, software or structures used in the above activities. Companies organized to do business as commercial broadcast radio stations, television stations or news organizations primarily serving in-state markets shall not be included within the definition of the term "telecommunications enterprises"; and
The new enterprises enumerated in this paragraph (a) do not include medical cannabis establishments as defined in the Mississippi Medical Cannabis Act.
(b) An exemption from ad valorem taxes granted under 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 an enterprise enumerated in paragraph (a) of this subsection (3), whether or not such property is owned, leased, subleased, licensed or otherwise obtained by such enterprise, irrespective of the taxpayer to which any such leased property is assessed for ad valorem tax purposes. If an exemption 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 enumerated in paragraph (a) of this subsection (3), the corresponding ownership interest of the owner, lessor and sublessor of such tangible property shall similarly and automatically be exempt without any action being required to be taken by such owner, lessor or sublessor.
(4) Any exemption from ad valorem
taxes granted under this section before * * * July 1, 2024, and consistent
herewith, is hereby ratified, approved and confirmed.
[From and after July 1, 2025, this section shall read as follows:]
27-31-101. (1) County boards of supervisors and municipal authorities are hereby authorized and empowered, in their discretion, to grant exemptions from ad valorem taxation, except state ad valorem taxation; however, such governing authorities shall not exempt ad valorem taxes for school district purposes on tangible property used in, or necessary to, the operation of the manufacturers and other new enterprises enumerated by classes in this section, including the projected annual value of raw materials and work-in-progress inventory estimated to be necessary to operate the new enterprise at full capacity during the term of the exemption granted, except to the extent authorized in Sections 27-31-104 and 27-31-105(2), nor shall they exempt from ad valorem taxes the finished products of the manufacturers or other new enterprises or automobiles and trucks belonging to the manufacturers or other new enterprises operating on and over the highways of the State of Mississippi. The time of such exemption shall be for a period not to exceed a total of ten (10) years which shall begin on the date of completion of the new enterprise for which the exemption is granted; however, boards of supervisors and municipal authorities, in lieu of granting the exemption for one (1) period of ten (10) years, may grant the exemption in a period of less than ten (10) years. When the initial exemption period granted is less than ten (10) years, the boards of supervisors and municipal authorities may grant a subsequent consecutive period or periods to follow the initial period of exemption, provided that the total of all periods of exemption shall not exceed ten (10) years. The date of completion of the new enterprise, from which the initial period of exemption shall begin, shall be the date on which operations of the new enterprise begin. The initial request for an exemption must be made in writing by June 1 of the year immediately following the year in which the date of completion of a new enterprise occurs. If the initial request for the exemption is not timely made, the board of supervisors or municipal authorities may grant a subsequent request for the exemption and, in such case, the exemption shall begin on the anniversary date of completion of the enterprise in the year in which the request is made and may be for a period of time extending not more than ten (10) years from the date of completion of the new enterprise. Any subsequent request for the exemption must be made in writing by June 1 of the year in which it is granted.
(2) Any board of supervisors or municipal authority which has granted an exemption for a period of less than ten (10) years may grant subsequent periods of exemption to run consecutively with the initial exemption period, or a subsequently granted exemption period, but in no case shall the total of the exemption periods granted for a new enterprise exceed ten (10) years. Any consecutive period of exemption shall be granted by entry of an order by the board or the authority granting the consecutive exemption on its minutes, reflecting the granting of the consecutive exemption period and the dates upon which such consecutive exemption period begins and expires. The entry of this order granting the consecutive period of exemption shall be made before the expiration of the exemption period immediately preceding the consecutive exemption period being granted.
(3) (a) The new enterprises for which any or all of the tangible property described in paragraph (b) of this subsection (3) may be exempt from ad valorem taxation, except state ad valorem taxation, ad valorem taxes for school district purposes, and ad valorem taxes on the finished products thereof or on automobiles and trucks belonging thereto and operating on and over the highways of the State of Mississippi, are enumerated as and limited to the following, as determined by the Department of Revenue:
(i) Warehouse and/or distribution centers;
(ii) Manufacturing, processors and refineries;
(iii) Research facilities;
(iv) Corporate regional and national headquarters meeting minimum criteria established by the Mississippi Development Authority;
(v) Movie industry studios meeting minimum criteria established by the Mississippi Development Authority;
(vi) Air transportation and maintenance facilities meeting minimum criteria established by the Mississippi Development Authority;
(vii) Recreational facilities that impact tourism meeting minimum criteria established by the Mississippi Development Authority;
(viii) Data/information processing enterprises meeting minimum criteria established by the Mississippi Development Authority;
(ix) Technology intensive enterprises or facilities meeting criteria established by the Mississippi Development Authority;
(x) Data centers as defined in Section 57-113-21;
(xi) Telecommunications enterprises meeting minimum criteria established by the Mississippi Development Authority. The term "telecommunications enterprises" means entities engaged in the creation, display, management, storage, processing, transmission or distribution for compensation of images, text, voice, video or data by wire or by wireless means, or entities engaged in the construction, design, development, manufacture, maintenance or distribution for compensation of devices, products, software or structures used in the above activities. Companies organized to do business as commercial broadcast radio stations, television stations or news organizations primarily serving in-state markets shall not be included within the definition of the term "telecommunications enterprises"; and
(xii) Controlled environment agriculture enterprises meeting minimum criteria established by the Mississippi Development Authority.
The new enterprises enumerated in this paragraph (a) do not include medical cannabis establishments as defined in the Mississippi Medical Cannabis Act.
(b) An exemption from ad valorem taxes granted under 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 an enterprise enumerated in paragraph (a) of this subsection (3), whether or not such property is owned, leased, subleased, licensed or otherwise obtained by such enterprise, irrespective of the taxpayer to which any such leased property is assessed for ad valorem tax purposes. If an exemption 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 enumerated in paragraph (a) of this subsection (3), the corresponding ownership interest of the owner, lessor and sublessor of such tangible property shall similarly and automatically be exempt without any action being required to be taken by such owner, lessor or sublessor.
(4) Any exemption from ad valorem
taxes granted under this section before * * * July 1, 2024, and consistent
herewith, is hereby ratified, approved and confirmed.
SECTION 3. Section 27-31-105, Mississippi Code of 1972, is amended as follows:
27-31-105. (1) Any person,
firm or corporation who owns or operates a manufacturing or other enterprise of
public utility as enumerated in Section 27-31-101 and who makes additions to or
expansions of the facilities or properties or replaces equipment used in
connection with or necessary to the operation of such enterprise may be granted
an exemption from ad valorem taxation, except state ad valorem taxation, ad
valorem taxes for school district purposes, and ad valorem taxes on the finished
products thereof or on automobiles and trucks belonging thereto and operating
on and over the highways of the State of Mississippi, upon each addition to or
expansion of the facility or property or replacement of equipment, used in
connection with, or necessary to, the operation of an enterprise enumerated in
Section 27-31-101, including the projected annual value of raw materials and
work-in-progress inventory estimated to be necessary to operate the additions to
or expansions of the facilities or properties at full capacity during the term of
the exemption granted, whether or not such property is owned, leased,
subleased, licensed or otherwise obtained by such enterprise, irrespective of
the taxpayer to which any such leased property is assessed for ad valorem tax purposes,
within the discretion of the county board of supervisors and municipal
authorities; however, such governing authorities shall not exempt ad valorem
taxes for school district purposes on such additions or expansions of the facility
or property, or replacement of equipment. If an exemption is granted pursuant
to this subsection (1) 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 enumerated in Section 27-31-101, the corresponding
ownership interest of the owner, lessor and sublessor of such tangible property
shall similarly and automatically be exempt without any action being required
to be taken by such owner, lessor or sublessor. In order to obtain the
exemptions authorized by this section, a person, firm or corporation shall
follow the same procedure prescribed for obtaining an exemption on a new
enterprise, except as otherwise provided in this section. For any additions,
expansions or replacements with reference to any particular new enterprise,
which have been completed during any calendar year, only one (1) request must
be made for the exemptions sought for the additions, expansions or replacements.
The time of the exemption shall commence from the date of completion
of the additions, expansions or replacements, and shall extend for a period not
to exceed ten (10) years thereafter; however, boards of supervisors and
municipal authorities, in lieu of granting the exemption for one (1) period of
ten (10) years, may grant the exemption in consecutive periods of five (5)
years each, but the total of such consecutive periods shall not exceed ten (10)
years. The initial request for an exemption must be made in writing by June 1
of the year immediately following the year in which the additions, expansions
or replacements are completed. If the initial request for the exemption is not
timely made, the board of supervisors or municipal authorities may grant a
subsequent request for the exemption and, in such case, the exemption shall
begin on the anniversary date of completion of the additions, expansions or
replacements in the year in which the request is made and may be for a period of
time extending not more than ten (10) years from the date of completion of the
additions, expansions or replacements. Any subsequent request for the
exemption must be made in writing by June 1 of the year in which it is
granted. Any exemption from ad valorem taxes granted under this subsection (1)
before * * *
July 1, 2024, and consistent herewith, is hereby ratified, approved and
confirmed.
(2) For expansions of facilities or properties, or replacement of equipment, county boards of supervisors and municipal authorities may grant a fee in lieu of taxes in the same manner, to the same extent, and with the same qualifying threshold as provided for projects under Section 27-31-104, Mississippi Code of 1972. Any fee-in-lieu of taxes granted under this subsection (2) before March 28, 2019, and consistent herewith, is hereby ratified, approved and confirmed.
SECTION 4. Section 27-31-107, Mississippi Code of 1972, is amended as follows:
27-31-107. Any person, firm or corporation claiming exemptions from municipal or county ad valorem taxation as provided in Sections 27-31-101 through 27-31-117 shall first file an application with the governing authorities of the municipality or the county board of supervisors, as the case may be, on or before June 1 of the year following the year of completion of the new enterprise or completion of the expansion or addition; however, no such application shall be required for, nor shall this section otherwise apply to, any fee-in-lieu of ad valorem taxation, granted pursuant to Section 27-31-104 or 27-31-105(2). Each copy shall be subscribed and sworn to by the individual making the application or, if a firm or corporation, by an officer or person duly authorized to do so. In the application, full information shall be given as to the property proposed to be exempted, the kind of articles to be manufactured, and the date from which exemption is claimed. Each application shall also show an itemized listing of the true value of all such property, including the projected annual value of raw materials and work-in-progress inventory, sought to be exempted. The governing authorities of the municipality or county board of supervisors may, by resolution spread on its minutes, approve such application for all or any part of the property sought to be exempted and for all or any part of the authorized period of exemption. The resolution of approval shall also have an itemized listing of the true value of all property, including the projected annual value of raw materials and work-in-progress inventory, to be exempted. The application, together with the resolution of approval, shall be forwarded to the Department of Revenue within thirty (30) days from the date of the resolution. The department shall proceed to investigate the matter and determine whether the property is eligible for the exemption. After investigation of the eligibility of the property, the department shall certify its determination to the governing authorities of the municipality or the county board of supervisors. If such property sought to be exempted is not eligible for such exemption, as above set forth, the Department of Revenue shall so certify. If the Department of Revenue certifies that the applicant is eligible for an exemption, it shall be discretionary with the board of supervisors or municipal authorities as to whether they grant the exemption, but in no event shall an exemption be granted if the Department of Revenue certifies that the applicant is not eligible for an exemption. The original copy of the application for exemption shall be returned to the governing authorities of the municipality or the county board of supervisors, as the case may be.
SECTION 5. This act shall take effect and be in force from and after July 1, 2024.