Jackson Jambalaya

The following is an assistance memo prepared by the PEER Committee staff in response to a specific legislative request. It is not a report of the PEER Committee, nor does it represent the individual or collective views of the PEER Committee members. A legislative assistance memo is PEER staff’s best effort to answer the questions posed within the time frame allowed and with the information sources available. Unless prior approval has been given, this memo will be distributed only to the requesting legislator(s) named below....

As you requested, PEER staff obtained information regarding the amount of local tax revenue Southaven, DeSoto County, and the DeSoto County School District are expected to receive from the xAI data center development in Southaven, Mississippi.

According to the DeSoto County Tax Assessor, xAI self-reported its total value as $500,000,000 in 2026, including $50,000,000 in real property value (e.g., land, building improvements) and $450,000,000 in personal property (e.g., automobiles, machinery and equipment, leased equipment, inventory).¹ This resulted in the following taxes assessed in 2026:

• approximately $892,000 in city taxes to the City of Southaven;

• approximately $834,000 in county taxes to DeSoto County; and,

• approximately $946,000 in school district taxes to DeSoto County School District.

Differences in the assessed millage rate account for the difference in the three above amounts.

These figures are below the $17,000,000 the DeSoto County Board of Supervisors expected DeSoto County alone to receive annually from the announced "$20 billion investment." Both the DeSoto County Tax Assessor and the Office of the DeSoto County Tax Collector stated they have not done forecasts for future years. However, the DeSoto County Tax Assessor added the DeSoto County Board of Supervisors anticipate collections to increase to $2,000,000 each next year as the xAI build out continues.

¹ On September 2, 2026, WLBT reported the Southaven Board of Aldermen approved plans from xAI to build a new data center on the site of the city’s old training facility. The project will convert the city’s old 51-acre training facility on Tulane Road into a 660,000-square-foot data center. It will be the second xAI data center in Southaven and fifth in the Memphis metro area.

Here is the transcript of the provided file "Screenshot 2026-10-08 at 10.07.50 AM.jpg":

The DeSoto County Tax Assessor stated he accepted the xAI reported amount instead of developing their own estimate, in part because information related to the xAI development is covered by proprietary protection clauses. This differs from Madison County, which developed their own estimate. The DeSoto County Tax Assessor stated he was not aware of any coordinated effort by state tax assessors (Madison, Rankin, Lauderdale, Hinds, Warren) regarding determining the taxable value of major data centers.

Madison County Tax Assessor Valuation of Amazon Data Center

At a Madison County Board of Supervisor hearing Monday, August 17, 2026, Madison County Tax Assessor, Norman Cannady, told the Madison County Board of Supervisors that each of Amazon’s five data center buildings at the mega site has a true value of nearly $292 million for the 2026 tax roll. That figure is based on a building area of 214,534 square feet for each structure. Cannady stated he had to develop a cost estimate for the property based on available industry cost data after Amazon denied multiple requests for documentation for actual costs, citing company policy (and open records concerns). Cannady’s argument is that these are "highly specialized data centers" and "not simply a conventional building or shell unique" and should be valued as such. Cannady added:

The real property includes specialized building systems that are integral to the facility. And their construction involves significant electrical, specialized structural requirements, mechanical cooling, redundancy, and supporting infrastructure.

Amazon’s appraisal, presented by the company’s tax manager, James Poliyanskiy, put the value of each building at just under $70 million, or about $324 per square foot. Poliyanskiy said the estimate was based on the Marshall & Swift Valuation Service, an industry standard cost-estimating tool, and requested the board adjust the combined assessed value for all five buildings to $349.9 million.

The Madison County Board of Supervisors voted to certify (i.e., keep) the Madison County Tax Assessor’s assessment unless Amazon can provide documentation to justify lowering that amount.

Fee-in-Lieu Agreement versus Tax Proceeds

The DeSoto County Tax Assessor stated he would prefer to see the board move to including a "fee in lieu" as part of the terms of economic development agreements so tax collections do not come in under the projected amount—particularly below the amount that the county/city based their decision to offer incentives. According to a Clarion Ledger article published June 6, 2026, Amazon and Clinton signed a fee-in-lieu agreement to provide $12 million every year instead of paying tax. Clinton Ward 6 Alderman noted the Clinton’s current budget is $22 million. The article did not specify if that includes funds to Hind County and Clinton School District or if they receive additional funding.