Thursday, November 19, 2015

Deadline? What deadline? MDA don't need no deadlines for Costco.

The war over all things Costco continues as the Clarion-Ledger and Andrew Mattiace slug it out in the courtroom.  The issue is pretty simple.  Mr. Mattiace and his fellow developers want nearly $30 million in tourism sales tax rebates from the Mississippi Development Authority while the newspaper and this website think you have a right to know how your money is spent.  If Mr. Mattiace wants to get his hands on the sales tax money, perhaps its times to dissect the tourism sales tax rebate program and see what exactly is in the MDA woodpile.


Section 57-28-3 of the Mississippi Code (2010) states:


incentive payments may be made by the MDA to an approved participant that incurs approved project costs to locate a tourism project in the state…

The aggregate amount of incentive payments that an approved participant may receive shall not exceed thirty percent (30%) of the approved project costs incurred by the approved participant for the tourism project.

Renaissance at Colony Park submitted an application to participate in the rebate program to the Mississippi Development Authority on December 23, 2013.  The MDA approved Mr. Mattiace's application on  June 10, 2014 and issued this certificate.



JJ and the Clarion-Ledger obtained copies of the certificate and the application through public records requests. Mr. Mattiace filed a petition to seal all MDA records concerning his application for the rebate on September 3, 2015 in Hinds County Chancery Court.  Attorney Mark Garriga of Butler Snow represented Renaissance.  Chancellor William Singletary cut to the chase and sealed Renaissance’s application and all supporting documents. Mr. Mattiace told the Northside Sun:

His opposition to the open records request for the details on Renaissance III are only to protect two aspects of the report: his financial information and his prospective client list.

His argument sounds reasonable as he just wants to keep other developers from poaching his project.  It is safe to say that those requesting the applications do not want to see it happen.  However, no one is asking for his trade secrets. Indeed, this correspondent and the newspaper want to see his project succeed.  Mr. Mattiace told a different story to the judge than he told to the reporter. The developer told the court that the release of any documents would harm his ability to recruit tenants for the project and compete against other developers.

Mr. Mattiace forgets that the sales tax rebate he so desires is our money. The working people of Mississippi have a right to know how their money is spent and also have a right to hold their leaders accountable for the use of that money as well.

However, there is one little fact that is left out of the controversy over Renaissance’s application for nearly $30 million in sales tax rebates. The Clarion-Ledger reported on September 16 a story that sported the headline

Time ticking for Renaissance expansion on state tax rebate deal

The developer who hopes to build a Costco as part of the Renaissance expansion in Ridgeland and receive a $29.6 million tax rebate from the state has approximately nine months to buy land, build and complete a $98 million dollar project before his certificate expires and the rebate vanishes….

However, the rebate rests on a caveat. According to the certificate, Mattiace “must provide in writing to Authority and the State Tax Commission a certification of completion” within two years of the certificate issued date. Construction on the proposed site has yet to begin…

Um, that is not exactly the case. It is understandable that the reporter made such claims in the story if she only reviewed the certificate, application, and statute.   However, MDA regulations that actually spell out the guidelines for the program and they have been virtually ignored by the media and Mattiace opponents during this entire controversy. Check out Mississippi Administrative Code Section 6-1:11.12:

Within three (3) months after the Completion Date, the Applicant must document the actual cost of the tourism project through a certification (Completion Certificate) of such costs by an independent certified public accountant or other independent party acceptable to the MDA. The Completion Date must be within 24 months following the Mississippi Tourism Rebate Program Certificate date, unless an extension is granted. The Approved Project Costs allowed for the tourism project will be the lesser of the actual costs as certified or the approved project cost provided on the application. Approved project costs may not increase regardless of the actual costs incurred by the project. (Emphasis added.)

“Unless an extension is granted”  means MDA Executive Director Glen McCullough has the authority to extend the deadline for the completion of the Renaissance at Colony Park III project for so long as he so desires. The regulations do not even state any criteria for the extension of the deadline. The regulations impose no final deadline but instead leave that to the discretion of Mr. McCullough. Governor Bryant appointed Mr. McCullough. Jim Barksdale is a co-developer of the project and was a predecessor of Mr. McCullough under Governor Bryant. Thus there is no ticking because unknown to the state newspaper, there is apparently no clock.

Mr. Mattiace is thus doing the dirty work for everyone else – Barksdale, Bailey, McCullough, et al - by going to court and trying to seal every piece of paper concerning his application. The developers made no attempt to negotiate with JJ or the Clarion-Ledger. They never attempted to work out a solution with the media but instead chose to get a court order to swing as a club towards all opposition. Indeed, the statute says MDA can only seal the records for up to two years but Mr. Mattiace argued a few weeks ago in a court filing that the two-year clock reset each time he provided new information to MDA- thus ensuring the two-year deadline rolls on almost forever.

The goal of this joint exercise between Renaissance and MDA is to funnel  nearly $30 million in sales tax money back to the developers of this project - developers who are very much connected to the highest levels of state government. Northside Sun publisher Wyatt Emmerich said Mr. Mattiace gave him a big hug when he met him for an interview and interpreted it a gesture of friendship. What is the saying about holding certain people closer?

It will be almost impossible to hold Mr. McCullough or his boss accountable for the rebate as Mr. Mattiace’s records will stay sealed behind an iron mask of cronyism. Any extensions granted to Mr. Mattiace will become a state secret. The project itself can change.  Suppose MDA engages in some cronyism and approves changes to the application that don't meet the guidelinens? Who will know?  This fight is not about discovering who the prospective tenants for Renaissance are. This fight is not about punishing Mr. Mattiace. This fight is about holding the leaders of the most corrupt state in America accountable for what they do with our money.

If Mr. Mattiace and his friends doesn’t want to be held to any scrutiny at all, there is a simple solution: Don’t ask us for our money.



Earlier posts
The Web at Renaissance (Read the comments) 
 Clarion-Ledger challenges Mattiace in court.
STONEWALL!!! Mattiace seals records 
12 applications for tourism sales tax rebates 
Renaissance applied for sales tax rebates.  
Mayor & Ridgeland residents spar over Costco.  





23 comments:

Anonymous said...

I have a related question. There was a "tourism tax" or something that was pushed by Leland Speed and Jeff Good and Malcolm White and others that was to be levied upon food, beverage, and hotel rates in the city. It was to pay for the convention center, and the promise was that it would be rescinded once the money pit was paid for.

Now, I realize that taxes never go away and all politicians are liars, but my questions are how much longer until that white elephant is paid for and who is holding the taxman accountable?

I expect the answers are forever and nobody.

JH said...

Mississippi Code section 57-28-1, sets forth the types of projects eligible for the Tourism Project Incentive Program. Pursuant to section 57-28-1(d):

"Tourism project shall include an entertainment district described below and may include any of the following as may be approved by the MDA:
(i) A hotel[;]
(ii) A nationally branded, themed entertainment district consisting of restaurants, bars, amphitheaters, live theaters, other entertainment venues and commercial improvements[;]
(iii) A nationally branded museum/aquarium[;]
(iv) A public golf course[.]

Last time I drove by the Renaissance, I didn’t see a museum, an aquarium, a golf course or and entertainment district. Likewise, Costco is a store, and not an entity listed above.

Hmm. . . .

Anonymous said...

This just seems to be another reason why the state should not do any tax credits. The people that get them don't need them because they don't owe that much in taxes, and the people that later buy them for a discounted rate have absolutely nothing to do with the project. They just become another way for the ridiculously wealthy to get more money. If the state wants to give 1 dollar for every 3 dollars spent on developing businesses it should just do so instead of using tax credits.

Anonymous said...

@1:52

It certainly seems to be in opposition with the spirit of the statutory language of the Tourism Project Incentive Program, but my best guess is that the parties involved with The Renaissance were able to get those funds via a combination of good ole boy politics and the slightly vague language of 57-28-1(d)(ii). It reads: "A nationally branded, themed entertainment district consisting of restaurants, bars, amphitheaters, live theaters, other entertainment venues and commercial improvements that the MDA determines to be tourism related located within the entertainment district[...]"

It wouldn't be difficult to argue (especially back during the planning stages, before any of us saw the actual outcome) that The Renaissance is a "themed entertainment district" with restaurants and "other commercial improvements" (i.e. nationally branded stores). From that point all you need are the right connections at the MDA so that your proposed improvements can be "determined to be tourism related." The exploitation of this law seems shockingly easy to me and yet I'm not surprised.

Anonymous said...

Kingfish, I'm dying for you to post more about the top folks at MDA that are either jumping ship or getting dumped from the ship.... Marlo and Mal??

Anonymous said...

Stop speculating, Bill.

Anonymous said...

Singletary loves some secrecy, doesn't he? Does he ever reject these petitions? The man needs to figure out who it is he works for. He should know that a consistent record of siding with Mattiace-like parties will give folks the "appearance of impropriety" sooner or later.

Anonymous said...

And Mayor McGee will go to work for Buster as soon as he leaves office. Even hick mayor can become lobbyist.

Anonymous said...

Just move along. Nothing to see. I "Phil" so much better about this already...

let's just hand over the money! Costco!

Anonymous said...

In Mississippi the law means for less than connections! This is a very corrupt state, but these folks will be church Sunday!

Anonymous said...

How is this regulation being followed?
Rule 11.10 E. requires “a resolution from the local governmental unit that acknowledges that no city diversion will be received on the sales tax collections and that the community supports the project location and plan.”

Remember: Mattiace’s application was for Renaissance II (2). Costco is a part of Renaissance III (3).

Timeline:
Dec 2013- Mattiace submits “cultural retail” tax incentive app for Renaissance II to MDA.

May 2014-Ridgeland passes resolution supporting Renaissance II.

July 1, 2014- “Cultural retail” tax incentive expired.

Dec 2014- Mattiace selected by Costco (part of Renaissance III) to lead the Costco “development and acquisition” (Ridgeland 08/17/15 press-release)

February 2015- For the first time, Gene McGee tells the board of alderman about Costco with instructions that “all discussions must be confidential.” (Ridgeland 08/17/15 press-release)

Since Mattiace wasn’t even selected until after the tax program expired and the Ridgeland alderman didn’t even know anything about Costco when it passed the Resolution before the tax incentive expired, how are there any rebates for Costco (Renaissance III)???????

This regulation is really funny:

Rule 11.16 Amendment and Waiver. “Development Authority’s Regulations allow it to amend the regulations “at any time”, or “in its discretion, may temporarily waive any requirement of these guidelines to the extent that the result of such waiver is to promote the public purpose of the Act.”

If this is the case, why even promulgate regulations? What’s the purpose of even having notice and comment???

We Have Gone To Hell said...

I quit reading at the phrase 'tourism project'.

Anonymous said...

I want my COSTCO.
Forget the BOZOS.
I want my COSTCO.
Or I'll put on my DOEJO.

Anonymous said...

1:18 PM

There was an additional tax on hotels, bars, and restaurants...but it expired in July, 2015.

So that tax has been rescinded.

Anonymous said...

Costco will make big profits, it is absurd for the state to pay them!suckers.

Anonymous said...

The additional tax for the convention center has not been rescinded.

Anonymous said...

Jim Barksdale - who props up Nancy Loome (who has criticized this specific program) - is a developer on this project and will personally benefit from it? Nice. KF, can you get a quote from him on that?

Anonymous said...

Did Mattice's original Renaissance proposal with the hotel include other phases of the project?

Can a developer now just add Roman numerals to a project name and be eligible for tax rebates even if they don't yet own the property for other phases ?

I'm sure it would be argued that acquiring property across the road is an expansion of the original project anyway if just continuing with the same name is not enough.

That would certainly be acceptable if it were Six Flags and property was later acquired across a road for more rides.

Since people who don't live here stay at hotels, any property with a hotel is eligible and it can argued they serve tourists ( instead of Butler Snow's out of town clients).

This ends up to be a big loophole since any retail center with a hotel on it qualifies apparently as it can be argue anything remotely near a tourist attraction should qualify. Of course, lucky for Mattice and Butler Snow ,the Renaissance hotel and shopping complex can be argued as serving tourists riding along the Natchez Trace.

You " fix" that by having tax rebates for hotels go through a Convention Bureau with credits for blocked rooms used or confirmation of the purpose of a visit for hotel guests. Then, you also tie those rooms to number of nights stayed. And, the hotel has to make available in the rooms and display tourist attraction information.

Legal loopholes are for dishonest people. So, Mattice and Ridgeland's elected officials have let us know they lacks character ,

They would be willingly and proudly be demonstrating how this project will benefit the State and local taxpayers with revenues expected to exceed the tax credit if this were about the best interest of Mississippi!

This is an example of gross fiscal irresponsibility so are all those involved self-declared liberal Democrats?







bill said...

I think we need to better define what makes a tourist, and therefore a tourist attraction. Am I a tourist when I leave my home in Madison and travel to another county to shop at Bass Pro Shop? What if I only drive to the next town to the south to the Apple Store? Maybe a four day trip to the outlet mall in Foley qualifies me as a tourist - it would also qualify me as an idiot - but the meat market in Crystal Springs shouldn't get tourist attraction money just because I like to go down there and buy their ribs. Has tourist been defined for the purpose of this law?

Anonymous said...

I think everyone should boycott Seafood R'evolution until Barksdale agrees to full disclosure. It would not be much of a sacrifice

Anonymous said...

Some say Obama should be impeached bc his regulations (ie regs for Obama Care & immigration) are overstepping. Guess what? Phil Bryant’s “cultural retail” regulations are no different. With the “cultural retail” regulations, Bryant claims he has the ability to change the regulations at any time and for any reason he wants. Can you say "arbitrary"? Can you say "capricious"?

Anonymous said...

Isn't giving money away like this Welfare? I mean, really, those involved need beach condos, car collections, flying first class...all on our money. We get SO upset at the child born into poverty whose mother gets food stamps, but not this?

Anonymous said...

@11:02

Obviously, you're just another cry baby democrat. You know us R's don't give a sh*t about whether or not a child is born into poverty. This is America. They can always work hard, educate themselves and pull themselves out of poverty. And, then they can be Black Republicans!



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