MississippiHB 9642025 Regular SessionHouseWALLET

MS Business Finance Corporation; extend repealer on authority to issue bonds to finance economic development projects.

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Bill Overview

Analyzed Economic Effects

6 provisions identified: 5 benefits, 0 costs, 1 mixed.

Project workers face deductions with tax credits

Approved companies can keep deducting job development assessments from paychecks for jobs created by projects in specified bond or approval categories. Employers choose whether to impose the assessment as a condition of employment. Caps are 2% of gross wages for hourly pay from $5 to under $7, 4% from $7 to under $9, and 6% at $9 or more. Workers receive Mississippi income tax credits, but credits cannot exceed taxes owed; unused amounts are not refunded or carried forward. Assessments end when the project's bonds are paid off. After a company closes a Mississippi facility, only project jobs above that facility's former job count qualify.

Investors keep development bond tax breaks

Investors keep Mississippi state and local tax exemptions on income from qualifying Mississippi Business Finance Corporation bonds. The exemption includes profits from selling those bonds. The related bond authority is scheduled for repeal October 1, 2028.

Officials remain barred from bond profits

Covered officials cannot gain financially from their duties involving the corporation's development bonds. Bond-income restrictions also cover listed relatives and associates. Specified clerical and administrative work is exempt, but attorneys' legal services are not. Violations carry one to five years in prison and fines of $2,500 to $10,000. These safeguards continue under authority scheduled for repeal October 1, 2028.

Business development financing extended three years

Effective July 1, 2025, the law extends Mississippi Business Finance Corporation financing and related tax-credit authority. Their repeal date moves from October 1, 2025, to October 1, 2028. The corporation can issue bonds for approved business development costs, with repayment terms lasting no more than 25 years. Repayment comes from financing agreements and pledged project funds or assets, not the state's general obligation. Eligible businesses include manufacturers and approved technology, research, headquarters, and distribution businesses. Warehouses and distribution centers need at least 50 workers, or 20 workers and a $5 million investment. Mining and medical cannabis businesses are excluded.

Development companies keep income tax credits

The law continues income tax credits for approved development companies, with the authority scheduled for repeal October 1, 2028. Credit rules depend on the project's bond issuance or approval history. Credits can reflect debt payments under financing agreements; the applicable later-project credit remains capped at 80% of taxes due. Qualifying excess payments can be recovered through available credits over the next three years. Agreements last no more than 25 years. Companies receive credits in the fiscal year they file the return for the agreement year. While their agreement is active, they do not have to make estimated income tax payments.

Financed business projects keep tax exemptions

Qualifying corporation-financed projects keep exemptions for project property, lease income, and specified financing agreements and purchases. Local taxing authorities must approve exemptions for the covered mortgages, agreements, and purchases. Specified contractors' and sales taxes remain payable, along with school-district property taxes. The stated income-tax exception also remains for projects and lease income. The related authority is scheduled for repeal October 1, 2028.

Sponsors & Cosponsors

Sponsor

Fred Shanks
Republican • House

Cosponsors

Lataisha Jackson
Democratic • House

Roll Call Votes

All Roll Calls

Yes: 163 • No: 0

Senate vote • 3/7/2025

Passed

Yes: 48 • No: 0

House vote • 2/11/2025