The Mississippi Senate, which has resisted an effort to provide a 1-cent sales tax for the city of Jackson to pay for improvements to its water system, voted Thursday by a 23-15 vote to allow Lee County to impose a 3/4-cent sales tax increase.
Senate Local and Private Chair Chad McMahan, R-Guntown, whose district consists of a large portion of Lee County, said before the sales tax could be imposed, it would have to be approved by voters during the next general election in 2023. In addition, Lee County supervisors, whom he said supported the bill allowing the sales tax increase, also would have to place on the ballot the projects that would be financed with the sales tax increase.
While the bill passed Wednesday does not list any specific projects to be funded through the sales tax increase, Lee County supervisors have recently proposed a sales tax increase within the county to finance a new county jail.
The Legislature has been reluctant to allow local governments to increase the statewide sales tax rate of 7%. Currently, there are two local governments with a local option sales tax on general items. The city of Jackson currently has a 1-cent sales tax for street improvements, and for decades the city of Tupelo has had a ¼-cent sales tax to help finance a surface water supply system.
This session, the city of Jackson has requested another 1-cent sales tax increase to help finance improvements to its aging water system that broke down during the February winter ice storm, leaving more than 40,000 people — mostly Black — without running water for weeks.
Rep. Chris Bell, D-Jackson, filed a local and private bill to allow the city of Jackson to impose the additional 1-cent sales tax.
But House Local and Private Chair Manly Barton, R-Moss Point, said he does not plan to take up any requests for local-option sales taxes, including the Lee County proposal and the city of Jackson’s 1-cent increase, and that has been a consistent House position in recent years.
Barton said that the Lee County bill will die on the House side, as the Lee County delegation is not united in support for the tax increase.
“We have been very hesitant to do general sales tax increases for other cities — in fact, we turn them down every year,” Barton said. “We had four or five requests this year. A lot of times the bills don’t even get filed. We work with them on local food-and-beverage, hotel-motel taxes, but there’s just no appetite to do general sales taxes. We’ve been pretty consistent.”
Barton added, “Part of it is the precedent.” He said that if lawmakers allow a city to add a local sales tax, “… we’d better get ready to do 20 or 30 of them for other cities next year. That has just not been the policy here, with our leadership.”
Senate Hob Bryan, D-Amory, who also represents a portion of Lee County, agreed with Barton and spoke against and voted against the local option sale tax increase for Lee County. He said every county in the state had a jail or access to a jail that had been funded without the aid of a local option sales tax and questioned why Lee, an affluent county, needed the sales tax increase when others did not.
“If we let Lee County do this, every county and every city will be up here asking for a local option sales tax,” he said.
In addition, Bryan said the sales tax is an unfair tax, forcing low wage earners to spend more of their income on basic items than more affluent people.
He said the county would be asking the low wage earners to pay a larger percentage of their income to finance the jail if the jail was built with sales tax revenue.
McMahan countered that the sales tax is the state’s fairest taxing method.
While the House has a bill to allow Jackson to impose the additional sales tax, no similar legislation has been filed in the Senate. And no senator representing Jackson has endorsed such a proposal.
The bill allowing Lee County the local option sales tax, which needed a three-fifths majority, passed by one vote. And 14 of the senators in the 52-member chamber did not vote or voted present.
None of the five state senators representing the city of Jackson supported their city’s proposed sales tax increase — the chief reason the Senate never considered it.
Four of them met privately with Lt. Gov. Delbert Hosemann on March 12, and none of those senators — Democratic Sens. Sollie Norwood, Hillman Frazier, John Horhn and David Blount — told the lieutenant governor they supported the sales tax increase, according to several of the meeting’s attendees. Sen. Walter Michel, R-Ridgeland, could not attend the meeting but was said to oppose the sales tax increase.
During Wednesday’s final vote on the Lee County sales tax increase, Norwood and Michel voted yes; Frazier voted present; Blount voted no; and Horhn did not vote.