The approval of a request for a tax exemption by a Delta industry received a cold shoulder during Monday night's Indianola Board of Aldermen meeting.
Attorney Richard Noble appeared on behalf of Clayton Dennington, president, Delta Cold Storage, LLC and made a request for a 10-year tax exemption on a $1,108,380.13 expansion to the existing cold storage facility, but the approval was almost iced after a motion from Alderman Darrell Simpson initially failed to receive a second.
Mayor Steve Rosenthal said, "Do we want to be seen as being non-business friendly?"
A subsequent discussion that lasted nearly 20 minutes resulted in Alderman Ruben Woods finally voicing a second to Simpson's initial motion and the exemption passed unanimously.
"I'm going to give you the benefit of the doubt, I'm going to second it," said Woods.
Alderman Sam Brock had raised the initial objection citing the board's previous decision to deny a tax exemption for business owner Maple Campbell after she made a request for her Platinum Plus adult care facility.
Brock asked, "Have the expansion been completed yet?” Noble indicated that it had been completed in the fall of 2019.
Then Brock, addressing Rosenthal said, "I want to know the difference between what Mr. Noble and Ms. Campbell presented before the board to get tax-exempt status and some kind of way in the dialogue you rejected or you said that Ms. Campbell couldn't get it because hers came after the fact and this right here looks like it is after the fact too, so I want to know what is going on here."
Rosenthal explained that the city offers a seven-year tax exemption based on pre-approved applications. "Everybody that brings a pre-approved application is eligible. She failed to do that; she came to us after it was over," he said.
Rosenthal further explained that when Campbell came back the second time former City Attorney Gary Austin said there was a way that it might be processed within the year that she opened and suggested that Campbell come by his office to further discuss it, but Campbell evidently did not go.
"This is the process on the state level and again she never came by and now it's past this point. Ms. Campbell had the opportunity to try for this," said Rosenthal.
He added, "Again, if we do it tonight, the ultimate decider goes to the state Department of Revenue. So we're just taking it and letting them decide." He again emphasized that Campbell did not follow through even after Austin called her twice and left messages. “So, she probably had that opportunity, but she failed to act,” Rosenthal said.
Brock asked if it would have been more beneficial for Campbell and Austin to discuss the matter in open meeting rather than in Austin's office in private. And Rosenthal said that it was not for a public meeting because it was her private business and that she would have had to bring it before the board once she had gotten an attorney to complete the necessary paperwork, like Dennington did.
Brock said, “I disagree with what you’re saying there, but y’all can roll on.”
Citing section 27-31-105 of the Mississippi Code as the basis for the request, Noble then explained that the proper steps are to file the application with the city and if they were to approve it, then file it with the county before submitting it to the state’s Department of Revenue for their approval.
Once the revenue board has approved it, the document would be returned to the city for final approval. "We're asking for 10 years, beginning this year," said Noble. He asserted that the aforementioned statute allows for that 10-year-tax exemption.
The exception would only be for the expansion and not the existing structure, which is already being taxed. And reportedly, only two new jobs would be created. However, Noble stressed that United Natural Foods Inc., formerly Supervalu, and all of the major catfish plants are customers of Delta Cold Storage.
Rosenthal mentioned that prior to the UNFI takeover, the Supervalu Distribution Center would come to the city and make similar requests for exemptions and that there are currently several active tax exemptions with the city for company expansions and improvements. "This is a normal process of business, to entice businesses to stay here in Indianola," Rosenthal said.
During the course of the discussion, Alderman Marvin Elder suggested that they table the matter until the county could render a decision, but was reminded that the city has to approve it before it can be presented to the county, so he then suggested that they table the matter until a later time.
That prompted Noble to make an appeal to the city leaders. Acknowledging his 40- year residency in the city, he admitted that the expansion would only create two new jobs; however, "Everybody's talked about getting together and trying to develop jobs, but it's an industry that is ancillary to a huge company and they are staying here because this man spent a million and one hundred thousand dollars. I don't know what the problem of not granting a tax exemption to have something grow Indianola, that to me flies in the face of what you all are here for," said Noble.
Noble then made a statement declaring that he didn't want this issue to be mixed with any previous matters calling this “an important issue."
Noble mentioned that Dennington elected to expand the Indianola plant versus the Greenville location because Indianola was centralized to his customers. He implied that the cold storage’s customers have given long-term commitments, which further enhanced Dennington’s decision to expand here.
Dennington stated that before his expansion at least one of his customers had one and a half million pounds of frozen food stored in another city, but that will now be stored in Indianola.
In his explanation of why he was asking for the exemption, Dennington said, "The electric company goes up every year. I don't know if y'all would want to even see the electric bill I have, to keep something zero degrees when it's 98 degrees outside or 101, it uses power."
To further his appeal, Noble added, “Those who are involved in economic development should pay heed.”
Rosenthal stated, “Mr. Brock I believe you're actually on our Sunflower County Economic Development board, are you not?" Brock replied, "I sure am."
Rosenthal responded, "So, if anyone should understand this..." Brock answered, “I understand, but we have to be fair with each other when it comes down to tax exemption. You can't measure one request by the other request; we have to be fair with them that's just the overall point. You can't say these are two separate entities no, it's one entity because it's all going to come from the city pot. A million dollars is a lot of money," he said.
Noble responded, "Mr. Brock we're not asking for an exemption of a million dollars. We're asking for a million dollar tax exemption, not school tax, the school is going to get their taxes. It is allowed by law. And if you're going to start comparing this to something else who is not a warehouse, is not a distribution, is not a cold storage, then in my opinion, (and) this is my opinion, this is not his, he may fire me after I get out of here, but in my opinion this is economic development that's going to keep jobs in Indianola Mississippi and Sunflower County.”
Noble continued, “He chose to put this business here, he could have put it anywhere, but he didn't, he put it here. And for this board to reject this tax exempt status, it's beyond belief."
During the discussion, Woods questioned if the two people being hired were from Indianola and mentioned another industry that came in and brought employees who were not from Indianola. "They came here, sucked up all of the tax money and then they left. You're not planning on getting the money and leave are you?" Woods asked.
Dennington said no and added that two of his employees live in Indianola and one lives in Inverness
Noble added that the Department of Revenue would not have a problem accepting the request.
