To abate or not to abate, that again is the question.
On Monday, the Sunflower County Board of Supervisors voted 4 to 1 to grant a tax break to Wade Inc., of Indianola.
President Glenn Donald cast the lone no vote. At the onset, Donald presented his argument against issuing the tax incentive, which sparked a discussion whereby he called for each supervisor to weigh-in with his or her opinion.
Donald began by acknowledging a conversation that he had with the city inspector concerning the matter and continued by stating the hardship situation the city and county are in with regard to needing money to fix roads and streets.
“We’re getting beat up pretty bad for as much money as the county and the city need. The city is in a deficit, but you’re giving tax breaks. Streets are falling apart, potholes everywhere,” Donald said.
He then questioned the number of additional jobs being created and asked Board Attorney Johnny McWilliams to advise the board. McWilliams began by stating the premise behind incentives, which he said is, “To get them to build something, it may not have taxes on it today, but after that you do.”
McWilliams further explained that for companies considering locations in other areas, if the local board decides not to give them an incentive then they wouldn’t have anything to tax now or then.
However, he added, “It is totally discretionary.”
He reminded the lawmakers that they are not required to give the abatement because the city did, but they are authorized.
Donald then asked if the board plans to give tax breaks to homeowners who install pools since their taxes go up or to the McDonald's restaurant since they are in the midst of a costly renovation.
“We open ourselves up to a lot. It’s steadily costing more to run the county. Are we going to put that burden on the individual citizen and land taxes?” Donald asked.
The conversation touched on whether Wade, Inc. was considering a new location. Donald said possibly in the area, but not outside.
“They might. You don’t know,” McWilliams said.
Donald stated a businessman told him that Wade has been planning this expansion for several years.
“We as a board can’t be threatened by they might move out of the city if we don’t give them this tax abatement,” he said.
“It’s not a threat, it’s a reality. Y’all are competing against other counties,” McWilliams said.
Supervisor Riley Rice added, “That’s the only incentive we have to keep existing businesses here, so that is why we give them that tax break… to keep them here.”
He then mentioned the SuperValu facility and how something may have to be done to entice the new owners to keep the warehouse here.
“I know we need the tax money, but if they leave here we won’t have any tax money at all.”
In an effort to distinguish between doling out breaks to existing businesses and new businesses, Donald mentioned the incentive given to Turner’s Downtown Market.
He said the existing stores were in an uproar about the decision.
However he said, “There was no business there. It was an abandoned building. They came in, fixed it up and made a store and probably 15 to 20 people work there now. That’s different from somebody who’s got a business that’s already viable.”
Donald continued regarding Wade Inc., “We do business with them. We buy equipment from them. We do service work with them, but we box ourselves in every time somebody does some renovations or tears down a building and this is not new, we’re giving tax breaks. Asphalt just went up, cold mix just went up, gravel just went up. Well, where are you going to get this money to pay for all these increase if you’re giving tax breaks on everything?”
Donald said he was only for giving breaks on new companies coming into the county.
Supervisor Dennis Holmes said in the past the board has given as much as 10 years of incentives to existing companies who completed multi-million dollar expansions and Wade was only asking for four years and it is incremental with 25 percent coming in after the first year and 25 percent each additional year until it is at 100 percent.
In addition, “They are already paying taxes. They are going to continue to pay taxes on what they’ve got and in the next year we’re going to pick up 25 percent of the $2.2 million.”
Holmes stated his intent to vote for the incentive although he sides with Donald that it should be for new businesses, but further established that Wade’is located in the designated central business district, which qualifies them.
“You know that was created just for Hampton Inn,” Donald injected, “It was special legislation just so Hampton Inn could get that tax break.” Regardless, Holmes said they qualify.
Rice then mentioned a statement made at a previous meeting where someone said that they didn’t want to get in the position of extending tax abatements to some and not to others (Attorney Johnny McWilliams made that statement in their July 2 session).
Rice stated, “We said that if the city approved it, then we’re going to approve it also.”
In that July 2 meeting, the Supervisors voted 3 to 1 to give a 7-year 100 percent tax abatement to businessman Sam Rosenthal based on his proposal to renovate an existing building he owned. At that time Donald said he was for issuing that incentive and stated then that one of the purposes of tax incentives was to maintain existing jobs. He added then that the county needed to do something to keep the jobs it has.
Also in that session, with regard to following what the city of Indianola does, Donald said, “We always have.” And although Rice stated that he and Dickerson were not against the tax break, but only had questions they would like answered, Donald insisted that Dickerson’s and Rice’s reluctance to issue the tax incentive could stagnate the economic growth of the county if it were to get out that county lawmakers were not for granting tax reductions.
Supervisor Anthony Clark was not present at that July session.
