MississippiHB 41122026 Regular SessionHouseWALLET

City of Tupelo; restore certain funding to be used by Northeast MS Regional Water Supply District for district operations.

Sponsored By: Shane Aguirre (Republican)

Signed by Governor

Local and Private LegislationLocal and Private

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Bill Overview

Analyzed Economic Effects

7 provisions identified: 2 benefits, 3 costs, 2 mixed.

Eminent domain allowed for water project

Local governments may use eminent domain to get land needed for the project. They must show the taking is required for public convenience and necessity. Property owners in the project area can lose property or rights through condemnation.

Bond funds build and start project

Bond money goes to the regional water district to build and launch the project. It can pay for construction, land and equipment, engineering, and legal costs. It can also cover interest during construction and for up to six months after completion. Startup and operations can be paid for up to 36 months after completion.

Property tax backup for water bonds

A trust holds the special sales tax and uses it only to pay the water bonds. If that and other pledged money are not enough, the city must levy a special property tax on all taxable property to make the payments. The water district must also use water-sale revenue left after operations to help cover the bonds. This can raise property taxes or water rates if revenues fall short.

Regional water district rules and access

The regional water project is owned by the Northeast Mississippi Regional Water Supply District. The district sells water and must charge local governments and water associations its cost. If a county in the Eutaw‑McShan aquifer is declared an emergency, it can join and must be granted access. New work to serve added counties is paid with user fees split equally among participating counties. Contracts, sales, or leases do not change the city’s authority to levy the special tax.

Rules and protections for Tupelo water bonds

Tupelo can issue general obligation bonds for the regional water project: up to $23 million (before March 2, 2007) and up to $30 million after. These bonds are backed by the city’s full faith and credit but do not count against the city’s legal debt limits. Bonds must be repaid within 25 years and follow interest‑rate rules (one rate per maturity; the lowest rate is at least 70% of the highest) under state caps, with interest paid once or twice a year. Bond income is exempt from Mississippi taxes (inheritance and gift taxes still apply). The city may refinance and use investment agreements; post‑2007 bonds must be issued by the later of two years after the act takes effect, two years after current city water bonds are paid, or two years after related litigation ends.

Officials cannot profit from these bonds

Legislators, elected or appointed officials, and their partners or associates cannot earn income from issuing these bonds. The law blocks conflicts of interest and self‑dealing around the bond sales. This protects taxpayers.

New 0.25% Tupelo sales tax for water

The law adds a 0.25% city sales tax on taxable purchases made in Tupelo, including food and drink. The tax must be in place before the city issues the water project bonds. Businesses collect it like the state tax and send it by the 15th each month. The money goes in a separate fund and can cover up to 50% of each bond payment and 50% of project costs. The tax ends the month after all bonds are fully paid.

Sponsors & Cosponsors

Sponsor

Shane Aguirre
Republican • House

Cosponsors

Nicole Boyd
Republican • Senate
Mike Thompson
Republican • Senate
Jerry R. Turner
Republican • House

Roll Call Votes

All Roll Calls

Yes: 338 • No: 0

House vote • 3/29/2026

Concurred in Amend From Senate

Yes: 121 • No: 0

Senate vote • 3/27/2026

Passed As Amended

Yes: 50 • No: 0

Senate vote • 3/26/2026

Passed

Yes: 52 • No: 0

House vote • 3/16/2026