Mississippi's Business Climate Carries On

More than half of Mississippi's counties are designated as federal Gulf Opportunity Zones, which offer significant advantages to businesses, as a result of the fallout of last summer's Hurricane Katrina.

Two major programs of the GO Zones are helpful to business development. The first is a bonus depreciation program where a business can take a 50 percent federal depreciation of its investment in a project in year one, rather than spreading depreciation across several years, says Gray Swoope, COO, Mississippi Development Authority.

Private activity bonds provide tax exempt financing for a variety of projects that wouldn't have qualified under federal law previously. “In the 49 GO Zones the allocation is for manufacturing, commercial, distribution and retail operations,” Swoope says.

In regard to 2006 legislative activities, Mississippi's economic development officials are working to build on recent successes to support the state's business climate. Officials are asking for continued funding for traditional programs and to implement initiatives that passed in 2005, which included a restructuring of incentives under the Momentum Mississippi plan.

Swoope says in 2005 the state added more flexibility to incentives that were geared heavily toward manufacturing operations to provide more financial incentives to new economy jobs.

These efforts came on top of major tort reform and workforce training initiatives passed in 2004.

Industries

Swoope says another dimension has recently been added to the state's industry diversification with the SeverCorr mini steel mill project, which selected Lowndes County, and which will support the state's auto assembler, Nissan, auto suppliers and other organizations. He says the $850 million project will provide a raw source of high-quality auto grade steel that frame shops and car manufacturers are interested in.

Lowndes County's economic development officials were busy in 2005, and attracted $938 million worth of projects, which are all under construction, says Joe Higgins, CEO, Columbus-Lowndes Development Link. In March, the community already had $404 million in commitments for 2006.

“Several companies are coming in as a result of SeverCorr's announcement,” Higgins says. “We estimated that there will be anywhere from five companies to nine companies to make investments if the steel mill came in. We have four of these companies under construction as a result, and we are working with four more that are in various stages of financing.”

Lowndes County also features an aerospace cluster, including American Eurocopter, a division of EADS, which is in the running for an Army contract to make a light utility helicopter, Higgins says. “The firm will know the result at the end of April,” he says. Wood and timber industries also do well in Lowndes County, where Weyerhaeuser just finished expansions at both of its facilities. Higgins says this year the firm announced a 150,000-square-foot warehouse facility, expandable to 250,000 square feet.

East Mississippi has attracted a new engineered wood products company, which will make a $140 million investment and create 140 jobs. “We also have a lot of modular home activity,” says Wade Jones, president, East Mississippi Business Development Corp.

Auto suppliers are also well suited to the area. Tower Auto is building a 400,000-square-foot facility, and creating 200 jobs, initially. Another supplier, Teikuro, Inc., has selected the region as well.

Also in east Mississippi, Meridian was selected by a logistics firm as one of the top 10 distribution locations in the country. Jones says according to a computer-based model, for a company that needs four distribution locations located across the country, Palmdale, Calif., Meridian, Chicago and Edison, N.J., are the ideal spots.

In addition to accessing 55 percent of the U.S. population in one day's truck drive, the logistics industry will receive a boost from a commitment by Norfolk Southern to conduct a $300 million upgrade to increase rail speed and capacity, Jones notes. What's more, U.S. Highway 80 is being widened to four lanes from Montgomery, Ala., to Meridian.

In Rankin County, which is part of the Jackson metro area, lifestyle developments and services are thriving in order to keep up with the growing community of 130,000 people. For example, the only Bass Pro Shop located in Mississippi opened in December at the Bloomfield Development. The Mississippi Braves, the Double-A pro baseball team that moved from Greenville, S.C., completed its first season last year, setting record attendance in the team's history. The Flowood Town Center has been announced, which is a smart-growth development to feature retail, commercial and residential buildings.

“A lot of the industrial and commercial growth is based upon our transportation advantages, as compared to other areas,” says Tom Troxler, executive director, Rankin First Economic Development Authority. “We are home to the Jackson International Airport, the only international passenger airport in the state, and we feature an intermodal rail facility — the largest in a three-state region, and access to Interstates 55 and 20.”

Workforce and Education

Several of the state's universities are engaged in economic development activities, developing ways to transfer knowledge into the private sector to create jobs and investments for their communities, Swoope says.

For example, Mississippi State University in Starkville is developing Phase II of its research and technology business park. In Hattiesburg, the University of Southern Mississippi is putting in the infrastructure for its innovation and technology business park.

“This year, we have announced plans in Oxford at the University of Mississippi for a research and technology park,” Swoope says. At the time of the interview, planning and feasibility studies were to begin.

University specialties include the polymer science program at the University of Southern Mississippi; pharmaceuticals, acoustical engineering and geospatial technologies at the University of Mississippi; aerospace and engineering at Mississippi State University; and e-commerce, communications and IT at Jackson State University.

Lowndes County offers access to four universities located within 75 miles, including Mississippi State University. East Mississippi Community College and a branch of Alabama's Bevill State Community College cooperate extensively for workforce training efforts, as both are partial recipients of the recently issue Wired Grants from the U.S. Department of Labor.

Jones says east Mississippi and west Alabama will use the funding from the Wired Grants to better prepare the region's workforce. “We are working with six community colleges, four in Mississippi and two in Alabama,” Jones notes.

Meridian Community College has a foundation that supports a tuition guarantee program where high school graduates from any one of the community's five high schools are guaranteed paid tuition for four semesters of college, as long as they meet the guidelines.

There is also a School Counts program in Meridian where more than 150 companies in the area offer preferential treatment for employment, again dependent on a student's ability to meet the requirements of the program.

What's more, Jones says 40 individuals from the community have made a commitment of $20,000 annually for five years to subsidize the salary of the next school superintendent, as the current one is getting ready to retire.

“We want to make sure we have the best superintendent for our school system,” Jones says. “Before we think of nurturing existing businesses or recruiting new industry, we ensure our schools perform well.”

Troxler notes that Rankin County's population growth is creating a large workforce, which includes the highest education levels in Mississippi, which means a highly trainable workforce. The community is home to Hinds Community College, which features full-service vocational training.

Business Climate

One thing corporations will discover about conducting business in Mississippi is the abundance of available land and facilities. Lowndes County was recently in the running for Kia Motors Corp.'s facility that went to West Point, Ga.

“We have control of a 1,800-acre megasite, called the Crossroads, which Kia considered,” Higgins says. “This has gotten the word out about the site and we are fielding more prospects interested in the site.”

Lowndes County officials have submitted the site to be designated as a TVA-certified megasite. “If we are certified by TVA, we will be the only community in TVA's service territory to have two of these sites,” says Chris Marsh, COO, Columbus-Lowndes Development Link. Of the five active TVA-certified sites, only one has sold, which is the SeverCorr site.

The nearly 1,400-acre SeverCorr site will feature an industrial park for high steel users, who are projected to use 200,000 tons of steel annually in order to co-locate with the steel mill and minimize their transportation costs.

In east Mississippi and west Alabama, officials have optioned 1,400 acres along the state line, located adjacent to Interstates 20 and 59. Norfolk Southern runs along the southern border of the site. Jones says a feasibility study found the site is conducive to supporting a 1 million-square-foot facility.

The area also features the new 577-acre I-20 and I-59 Industrial Park with full infrastructure in place, as well as rail services.

In Rankin County, a 250-acre business park recently opened with infrastructure in place to support light industrial, distribution and office buildings. “Auto supplier locations are growing because of Nissan, particularly in the northern part of Metro Jackson,” Troxler says.

In terms of the pro-business atmosphere the state continues to build on, Swoope says Mississippi's competitive advantage is an economic development team that has experience and the right attitude to make things happen. “For Nissan, our team delivered the largest greenfield site in the country, which was a $1.4 billion project to produce five models of cars, where four were brand new models,” Swoope says. “We delivered the project on time and on budget.”

“We know how to do deals,” Higgins says. “If you come in, you will see a well-oiled machine. We are not learning on your project.”

The East Mississippi Business Development Corp. has a 15-member committee that calls on existing companies every year to maintain a dialogue. “There is another benefit from this committee,” Jones notes, “which is that officials have knowledge of what existing companies are experiencing, which can be conveyed to prospective companies.”

Growing corporations can couple that experience with the efforts underway in this year's Legislative session to enhance business climate initiatives.

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