State lawmakers approved a $250 million bond bill on Monday that includes an appropriation for the construction of a Starkville-Oktibbeha Consolidated School District-Mississippi State University partnership school after representatives and senators held pointed debates on it and a franchise tax cut in each chamber.
Among the statewide allocations approved in House Bill 1729 is a $5 million pledge for the new campus. Additional language provides another $5 million in the future once local or federal funding sources “have been irrevocably dedicated” toward paying for the project, the legislation states.
The state’s allocation is the second of three funding streams that will construct a school on MSU’s campus for all grades 6-7 students in Oktibbeha County. The university previously pledged $10 million toward the project — most of which came from a land donation — and the school district is now expected to broach a reverse referendum to raise the remainder of the estimated $30 million project.
The Legislature previously authorized the reverse referendum in past bills addressing local consolidation. SOCSD Superintendent Lewis Holloway has said expiring debt should negate a significant tax increase, but an exact millage requirement to service the debt is unknown at this time.
The House passed HB 1729 by a 109-9 margin, while the Senate voted 46-6.
It now heads to Gov. Phil Bryant’s desk for approval.
David Shaw, MSU’s vice president for research and economic development who served on the consolidation committee that recommended the partnership school, said he was pleased the Legislature saw the school’s great value and its potential impact in the district, state and across the Southeast.
“This funding gives us tremendous momentum to continue down the pathway of addressing some of our most critical education issues in an incredible facility and setting on the MSU campus,” he said.
Reaction from area House members was mixed after Monday’s vote. The bond bill’s fate — the conference report required passage in both the House and the Senate — became intertwined with how the House approached Senate Bill 2858, also known as Taxpayer Pay Raise Act of 2016.
That bill, which was approved in both chambers, phases out income taxation on the first $5,000 of taxable income and franchise taxes. If signed into law, it would cut about $415 million in state revenue over 12 years.
From the House floor, lawmakers blasted the Senate — Lt. Gov. Tate Reeves, specifically — for pushing the bill while holding the state’s bonding legislation hostage. House Ways and Means Chairman Jeff Smith, R-Columbus, acknowledged Reeves was unlikely to allow senators to approve the bond bill if the House didn’t first pass the tax cut.
The House was the first chamber to vote on the tax cut. Senators took up the bond bill after the House passed SB 2858.
“If we go home without doing something for our colleges and universities, we’re being negligent, and this is something I think we need to reluctantly do,” Smith said before the vote on the tax cut.
Rep. Gary Chism, R-Columbus, said lawmakers also balked at the bill because they wanted a trigger to prevent cuts in years where Mississippi revenues do not show a 3 percent growth.
“Of all the years — especially when we just got through cutting everybody’s budget — to be demanding a tax cut without a trigger was just really unpalatable,” he said. “Many of us are fed up with the way that the House is treated. They’ll bash us at every opportunity and say, ‘Look at them. We don’t have the money, but they’re still trying to spend it.’ It’s not uncustomary for this lieutenant governor to (force the House’s hand). It seems we always have to come around to his deal, whether it’s in a bond bill or for charter schools.
“We have a leadership team, and the chairmen have great influence over the House,” Chism added. “Over there? It’s his way or the highway.”
Representatives passed the tax cut 73-44, while senators rubberstamped the measure 36-14.
It now awaits Bryant’s signature.
“A flatter, fairer tax policy can grow the economy of our state and make Mississippi-grown businesses more competitive in the global marketplace,” Reeves said in a statement.
Since the cuts do not go into effect for two years, lawmakers have two more sessions to adjust tax rates if revenue shortfalls continue.
Carl Smith covers Starkville and Oktibbeha County for The Dispatch. Follow him on Twitter @StarkDispatch
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