Sunday, March 19, 2017

Commission & Mayor continue to scrap over loan

The hard feelings that developed between Jackson Mayor Tony Yarber and several members of the 1% Sales Tax Commission at the March 1 meeting continue to linger.  Anna Wolfe posted a follow-up story on that particular food fight last Friday.  Her story is posted below along with some color commentary by yours truly.  Enjoy.


At the conclusion of a contentious one-cent sales tax meeting March 1, commissioners approved a master plan that could prevent Jackson from obtaining the $90 million loan it has worked to obtain for over a year.

In an interview with The Clarion-Ledger Wednesday evening, Jackson Mayor Tony Yarber first said he would not protest the plan, then wouldn't say if he would abide by it. The plan requires the city to get commission approval before entering any debt obligation to be paid back with one-cent funds.

"I'm going to follow the state law," Yarber said, calling the commission's plan an attempt to supersede Mississippi statute.

Yarber was referencing the law the state wrote to allow the city to set up the sales tax program, which states Jackson is "authorized to incur debt, including bonds, notes or other evidences of indebtedness, for the purpose of paying the costs of road and street repair, reconstruction and resurfacing projects based on traffic patterns, need and usage, and to pay the costs of water, sewer and drainage projects in accordance with a master plan adopted by the commission."
 Ms. Wolfe states the law correctly.  Section 27-65-241* of the Mississippi Code allows the city to securitize the 1% sales tax revenue and borrow against future collections.  It does not  give the 1% Sales Tax Commission the power to approve the borrowing.  However, Ms .Wolfe continues.

The problem is, there's been no approved master plan up until this point.

"Expenditures of the revenue from the tax authorized to be imposed pursuant to this section shall be made at the discretion of the governing authorities of the municipality if the expenditures comply with the master plan. The commission shall monitor the compliance of the municipality with the master plan," the law states.
 Ah.... there is a problem.  The commission did not approve a master plan until March 1.  The plan approved was submitted by Commissioner Ted Duckworth (Read the plan here.)  The law does not state that only the Mayor can submit a master plan.  Anyone can submit a master plan to the commission.

However, the law does give control over how the funds are spent to the commission.  The city can borrow as much money as it can against the 1% sales tax - but it can only spend the money on projects approved by the commission.  Thus the city may indeed get a honeypot of gold that makes every contractor and politico drool but the commission will direct where the money goes by selecting the projects funded by the loan.  However, an administration so inclined to favor its friends could still do so but only on project approved by the commission in its master plan. 


Just two days before the commission's last meeting, the Jackson City Council voted to move forward with the $90 million deal, even though the commission had not approved it.

Commissioners argue that the city cannot expend the one-cent money, or, by extension, obligate it to pay back a loan, without its approval. Some characterize the push to obtain the loan as a political move considering the upcoming municipal election.

"Here we are two months before an election and trying to cram though something that's going to tie the city up for the next dozen years when we don't know who the administration is going to be — City Council or the mayor — two months from now," said sales tax commissioner Pete Perry.
JJ must respectfully and humbly disagree with Mr. Perry on this point.  The legislature clearly stated that the city has the power to borrow against the 1% sales tax.  If it wanted to give the commission the power to explicitly approve the borrowing, it would have done so with the same language. The legislature did not state that the commission could approve the borrowing of such funds.  It gave that power to the city.  The commission can control how the funds are spent but it can't stop the city from actually securitizing the revenue.

It just happens to be a coincidence that the big push to borrow the money happens right before the municipal elections.  Nothing like a pot of gold to promise to contractors and tell the public "look what we are doing for y'all, don't forget to vote for me."  One last shot to get everybody paid before the electoral earthquakes take place in May.  Then there is the matter of going to the Mississippi Development Bank:

Though the city continues to argue that the commission doesn't have the authority to prevent it from leveraging the one-cent funds, officials confirmed to The Clarion-Ledger that the Mississippi Development Bank has decided not to accept the city's loan application until it's clear the commission is on board. So regardless how the law is to be interpreted, the commission has won veto power in this case.

Now, Yarber said he plans to challenge everyone involved in this loan to follow the law and compel those responsible for enforcing the law to get involved. He would not go into further detail about his strategy.
Keep in mind that the city did not submit a loan application to the bank.  This correspondent attended the March meeting of the MDB board and the loan was not even discussed.  The Executive Director told this correspondent that the city had not submitted any paperwork of any kind pertaining to a loan.  It appears bank officials don't want to get involved in approving a loan unless the commission and city are playing on the same sheet of music.  They probably wanted to at least see a master plan before it reviews anything else from the city.

It is not clear what the Mayor meant in his promises to "challenge" and "compel". 

Notably, the 2013 Mississippi Code included language that said, "No expenditure of revenue from the special sales tax authorized by this section may be made without the prior approval of the expenditure by the commission." This has been removed from the current law.

Stay tuned Sunday for The Clarion-Ledger's Jackson infrastructure deep-dive report.
 The primary purpose of this loan is to fund the Tiger Grant project for North State Street and West County Line Road.  The amount of the Tiger Grant shot up from $16.5 million when it was first announced in 2015  to $38.5 million.  The proposed project will connect West County Line Road to North State Street but provide an overpass for the railroad.  The matching fund requirement increased the city's share from 20% to 50%.  The remaining funds would be used for commission-approved projects.

It is the opinion of this website that the funds would be better used for other infrastructure projects.  However, spending millions of dollars to create a railroad overpass and open up land for development around Tougaloo  is an option that should be rejected.  Spend the money on North State Street but there are plenty of other areas that need help. 


* Section 27-65-241 of the Mississippi Code states:


(h) The commission shall, with input from the municipality, establish a master plan for road and street repair, reconstruction and resurfacing projects based on traffic patterns, need and usage, and for water, sewer and drainage projects. Expenditures of the revenue from the tax authorized to be imposed pursuant to this section shall be made at the discretion of the governing authorities of the municipality if the expenditures comply with the master plan. The commission shall monitor the compliance of the municipality with the master plan.

(8) The governing authorities of any municipality that levies the special sales tax authorized under this section are authorized to incur debt, including bonds, notes or other evidences of indebtedness, for the purpose of paying the costs of road and street repair, reconstruction and resurfacing projects based on traffic patterns, need and usage, and to pay the costs of water, sewer and drainage projects in accordance with a master plan adopted by the commission established pursuant to subsection (7) of this section. Any bonds or notes issued to pay such costs may be secured by the proceeds of the special sales tax levied pursuant to this section or may be general obligations of the municipality and shall satisfy the requirements for the issuance of debt provided by Sections 21-33-313 through 21-33-323.

13 comments:

Anonymous said...

where would you spend the money? not trying to be a jerk or anything... i'm just curious.

Anonymous said...

I trust the commission more than I trust any elected official w/in the city

Anonymous said...

This is a con from the start. The Tiger grant is for Benny Thompson to help himself and the private college; not for the City.City lied about having the match ready to use since the match is the main reason the City got approved over others across the nation.There should be only one Master plan or Capital improvement program for the City ; not one for each official. The commission is not much but all the City has to slow down the stealing. How about a 90 million debt and nothing to show for it ; that is were this is heading.

Anonymous said...

This isn't a Bennie special: it's Senator Cochran thanking the City for the 2014 reelection. Thompson actually wanted something to benefit Clinton/Bolton and the Continental area. He was trumped by a Senator. Sometimes the obvious connections aren't the explanation. Only giving Bennie a pass on this one, not on anything else.

Anonymous said...

Priester has been exposed.

Anonymous said...

The 7 billion request from our state government has nothing for road or bridge repairs. I thought that was such a big need as to increase the gas tax. Of course, Jackson get nothing.

Anonymous said...

9:49 this project has been going on for almost 20 years with Benny putting the College in the land business.

Anonymous said...

Of all the things needing fixing in the City of Jackson and this is what they want to spend the lions share of the money on? No wonder the city/Hinds County is in the shape its in. #whywecanthavenicethings

Pete Perry said...

JJ must respectfully and humbly disagree with Mr. Perry on this point.The legislature clearly stated that the city has the power to borrow against the 1% sales tax. If it wanted to give the commission the power to explicitly approve the borrowing, it would have done so with the same language. The legislature did not state that the commission could approve the borrowing of such funds. It gave that power to the city. The commission can control how the funds are spent but it can't stop the city from actually securitizing the revenue

"Here we are two months before an election and trying to cram though something that's going to tie the city up for the next dozen years when we don't know who the administration is going to be — City Council or the mayor — two months from now," said sales tax commissioner Pete Perry.

Please tell me, Kingfish, what part do you disagree with me on this. I did not say anything about the City's "ability" to borrow money secured by the sales tax. I did question the wiseness of the city taking this action two months before the election - tying up the money for the next dozen years for what will be a different administration.

I also said - in another place - and you note in your comment that the Commission would have to approve the "expenditure" of the funds to pay back the loan. Whether that affects the "ability" of the city to convince a lender to loan the money is a matter of conjecture.

You, along with other media types, need to put all the parts together before you start your disagreeing.

Anonymous said...

You, along with other media types, need to put all the parts together before you start your disagreeing.

Buzz off with the heavy handed bullshit Pete.

If there is any media outlet in this state that has your (specific) back and pulls comment punches to protect your butt -- especially regarding #mssen -- it is Kingfish.

People get sick of you needing to be a damn expert about everything. Then you come here to a friendly venue and play big man. Give it a rest.

Pete Perry said...

Anon at 1:47. I totally appreciate the 'friendly venue' at this site. But I can - and do - expect to disagree with KFish every now and then. And I expect him to call the balls and strikes as he sees them as well. But when the unusual situation occurs that what I have said is actually what is printed, I will take issue when other words that I have not said are added into them. At least, when it matters.

Sorry my commentary upsets you so much - I'll be glad to send your anonymous self an Alka-Seltzer if you will give me an address.

Anonymous said...

Pete is right and that hurt me to say.

Anonymous said...

Your headline for this article is somewhat dated. Doesn't look like they are continuing to do anything. Anna Wolf has just put two or three weeks worth of stories into one long column. Nothing at all new here and it doesn't look like the commission is really fighting over a loan at all. More like Yarbor just is not happy with not getting his way and being outsmarted by Perry and Duckworth. His wanting to borrow a bunch of money seems to be just a part of the story but your heading makes it sound like thats all it is.

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Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).


Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

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This is definitely a Beaver production.


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There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

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