By Jack Gurner
WATER VALLEY-BorgWarner’s application for a tax exemption has been in the forefront of many people’s minds, but it was the last thing on the agenda at the regular monthly meeting of the Water Valley Board of Alderman Tuesday, July 1.
Discussion of the ad valorem tax exemption for BorgWarner and Water Valley Poultry began about one hour and fifteen minutes into the meeting when Mayor Bill Norris announced that both requests “are in the guidelines of the state.”
City Clerk Vivian Snider said that both companies had filed on time. “I went and spoke with Linda Shuffield (Yalobusha County Tax Assessor) to get some insight on what we are looking at.”
Snider explained that they had come up with a figure for BorgWarner giving them everything they have asked for. “We’re looking at approximately $221,780. If you just go with the new line they just put in, it would be an exemption of $8,519,” Snider said.
She also explained that based on a ruling BorgWarner officials claimed they had found under state law, the company could go back and reapply each year for those years that they missed. The city clerk added that the almost $222,000 figure is just what they are asking for this time.
Snider then gave an amount of $10,691 for Water Valley Poultry’s exemption. She added that they had asked for the exemption for the next ten years. “That’s based on if we left our millage rate at 37 mills.”
Board attorney David Burns said, “If I may. I looked at the application that Borg submitted. It’s (number) seven, all the way back to December of 2000. In all of them they request a ten-year exemption. I don’t think you can do that. The statute is pretty clear on that.”
He continued that the statute was amended in 2006 to allow companies to request exemptions that would cover the balance of the ten-year period. But, they could not get the full ten-year period if they had not requested the exemptions at the time.
“They asked for ten years on them all, but I don’t think you can do that,” Burns said.
Norris asked board members if local businessmen had approached them about the tax exemptions. He then passed around a letter that he had received “from one of our businessmen.” The letter was addressed to the mayor and board from CPA Joe Black (see the letter posted below this story).
Norris said that he had heard from “prominent business people” who had expressed concerns over keeping BorgWarner here. “Anything we can do to help would be greatly appreciated,” the mayor added. “We don’t need to lose them.”
“They’ve got the new line going,” the mayor said. “It’s not going as fast as they like it to go… I talked with others and they do have some new equipment and new contracts in the future. Right now I think there is 479 employees there.”
Alderman Sherry Martin asked, “When do we adopt a budget…September…August?”
The mayor answered, it has to be adopted in September.
Alderman Lance Clement said, “We really can’t even make a decision until we start looking at the budget.”
“She’s supposed to give me the figures Monday,” Snider said, referring to tax assessor Shuffield.
“We don’t even need to talk about it tonight then if we don’t have the numbers,” Martin said and then asked. “What do you need, a motion to table it to the next meeting?”
“This is informal,” the mayor said of the discussion.
Clement made a motion to go to the next item, but a motion wasn’t needed and the mayor moved on to the next business.
Earlier in the meeting, the board took the following actions:
• The board heard a request from the Street Department to purchase a Ford F-250 Crew Cab at the state contract price of $19,400. “They were going to ask for two, but we made concessions,” Norris said.
The street department grass cutting crew currently uses a second vehicle, which had been at the cemetery and parks department.
Alderman Fred White questioned the need for a crew cab. Street Department Manager Mike Scroggins answered that the truck would be needed to haul workers to job sites around town.
Alderman Lance Clements then asked if a truck had “gone down.” Scroggins explained that the truck currently in use is a 1995 model that has been driven about 160,000 miles and needs a lot of maintenance. “We just worked on it today,” he said.
“Is this something we budgeted for?” Clements questioned.
“There’s nothing in the budget for it,” answered Martin.
The discussion then turned to the amounts owed for equipment by the street department. White asked Scroggins if a used truck would suffice.
Scroggins replied that it would if it were a good, up-to-date truck, but he expressed concern over the lack of warranty.
Scroggins described a common scenario for the department in which equipment has to be hauled to change a tire on a garbage truck. “We need something dependable.”
“Thinking about repairs and everything, I make a motion that we purchase it,” Alderman Charlie Harris said,.
“I’ll second Charlie’s motion,” Alderman Tommy Swearengen answered.
After discussion of the price difference between the various cab configurations available, they asked Scroggins if a regular cab truck would work. He agreed that it would.
Scroggins also explained that the new truck would replace a vehicle that had “done its time.” He added that the older vehicle would remain in the department for use within the city.
Clements asked again about the cab configuration and said, “Very seldom would you need the back (seats) to carry workers around. Is that what you are saying?”
Scroggins said that he could work with a regular cab. “We try not to ride in the back in the bed. We were told by the previous board that they didn’t want us riding in the bed because of liability.”
The board then voted on the motion to purchase a crew cab truck with only Harris and Swearengen voting yes.
Martin then motioned to purchase a regular cab truck that was seconded by Clements.
White then injected a comment about the street department having overspent on their budget for gas. After five more minutes of discussion, the board voted to purchase the regular cab truck.
• The aldermen voted to allow the Water Valley Junior Auxiliary to leave some art works from the Art in the Park event on display at the City Park.
• The board voted to let the Water Valley Electric Department “write off” a list of delinquent electric bills. The twice-a-year-procedure is for bookkeeping purposes. Electric Department Manager Joe Newman said the lists would be kept on file and collected in the future if possible.
• Aldermen voted to pay an invoice for $16,050 from Willis Engineering. The payment is for work under a federal grant for improvements at the airport
• City officials accepted a donation from the Water Valley Town and Country Garden Club of $9,269 for the purpose of purchasing trash containers for various locations within the city limits. The new containers are just like the ones located in Railroad Park and will replace the gray plastic containers in the downtown area.
• The board voted to begin replacing bridges beginning with the one on Lafayette St. which has been condemned at various times over the years.
According to Mayor Norris, the bridge will be replaced with two, six-foot culverts which will cost roughly $8000. The money is left over from work on Town Creek.
Alderman White commented that the city has three bridges that are in the same shape. “Wouldn’t it be smart to get the one with the most traffic on it first?” he asked.
One is on Boyd St. and the other on Martin St., White continued.
The mayor said that the bridge on Boyd St. was next on his list. However, the bridge on Lafayette had been condemned before and the school district had expressed concern over school buses having to cross it.
“I was hoping to get this one before school started,” the mayor said.
White said that the bridge on Martin St. probably had more traffic than the other two combined and suggested that the city tackle it first.
Street Department Manager Scroggins said that work on the Martin St. bridge would require a lot of water and sewer line rerouting.
The mayor agreed to gather some figures for replacing the other two bridges in time for the next meeting.
• Aldermen agreed to correct a mistake on the city zoning map that would change the colors to reflect the proper R-4 zoning of the area around Burks Dr. According to a finding by the Planning Commission, the mistake was made when the map was created and the intention was for the area to be R-4 instead of R-1.
The change would allow Rodney Phillips to place a mobile home on property located between property already zoned R-4 and the city brush dump.
• Board members agreed to sell the old mosquito sprayer to the City of Roxie (population 560). Originally, the plan was to donate the sprayer, but White said that he didn’t believe that the city should just give property away. “Sell it to them for $10 or something,” he added.
Although it is legal under state law to give surplus property to another municipality, the board agreed to attach a $10 price to the sprayer. It was originally purchased as surplus “many years ago” for $50.
• Aldermen approved the purchase of a used mini-truck for the electric department to use within the city. Department Manager Joe Newman said that he had been researching the small, fuel-efficient vehicles. “I’d like to try it,” Newman said. “I don’t think there is much to lose.”
Newman explained that he could put a tube for a “hot stick” and a small tool box in the vehicle and use it for after-hours calls and for reading meters. Mini-trucks sell for $3500 to $8000 and get from 40 to 50 miles-per-gallon, he added.
• The board approved replacing a memorial marker on the police and fire station that honored Frank H. Holloway. The original, which was approved in 1980, was destroyed by the 1984 tornado.
• Aldermen approved payment to the Burns Law Firm of $1140.
• The board approved advertising for “policemen” for the Water Valley Police Department.
White asked how many and the mayor answered that three had gone. “He (Chief Mike King) is going to be looking at one, two, or three just depending on the qualifications,” the mayor said.
At last month’s meeting, after coming out of a lengthy executive session, the board voted to hire a part-time employee for the fire department and to advertise three full-time positions in the street department.
• Aldermen approved the mayor’s request to join the North Mississippi Mayor’s Association after Norris explained the advantages of being a member of the organization. He used the example of a group purchase of roll-type garbage cans. He said that by going in together, the cities could purchase such items at a lower cost.
“Leaning on each other for support,” is the way the Norris described the association.
“I’ll make the motion,” said Swearengen. Martin added a second. When the vote came, White abstained and said he didn’t think membership in the group would help the city.
• The board voted to close the meeting to determine if an executive session would be needed. The vote came after Attorney Burns explained to the board they needed a motion that the meeting be closed for a preliminary determination of the necessity of executive session. “In other words,” he said, “to close the meeting to determine whether there is a necessity for an executive session.”
After determining that the matter to be discussed fell within the legal definition of personnel matters under state law, the board voted to enter executive session.
After a 21-minute closed session, the board returned to regular session and voted to lift the suspension of Ray White, an employee of the Street Department, effective Monday, July 7. No reason for the suspension was stated in the motion or during the meeting.
• Aldermen voted to adjourn at 8:27 p.m. All board members were present for the one-hour and 52-minute session.
BorgWarner Tax Exemption Necessary Expense
Editor’s Note: The following letter was hand delivered to City Hall in time for last week’s city board meeting and was addressed to the Mayor and Board of Aldermen. The Herald is publishing the letter as part of our city board coverage.
Dear Sirs and Madam:
In recent weeks there has been much discussion in the community about BorgWarner’s recent request for a property tax exemption on certain manufacturing equipment located at the Water Valley production facility. I want to take this opportunity to express my support for such an exemption.
I know that the City faces many budgeting issues, such as fuel costs, employee pay and insurance costs, and needed capital improvements, along with many other competing needs. Finding funding for all is difficult at best and most likely impossible without using reserve funds. Giving up any portion of tax revenues is hard to do and should only be done when concrete benefits for the citizens of Water Valley can be had in exchange.
I believe that these benefits are many and in the long run far outweigh the short term loss of revenue. First, every main street merchant I have spoken with can attribute substantial business revenues to the employees of BorgWarner. These sales vary from 10 percent to over 30 percent of their gross revenue. Losing that volume would be disastrous for Main Street. Second, we have many families in our community that have both the husband and wife employed by BorgWarner. A loss of one wage for them would be severe but the loss of both would be an almost impossible event to overcome. Finally, the City should strive to attract new employers and to assist existing employers in maintaining and expanding their operations in any reasonable way. We must have and project a “business friendly” and “can do” attitude if we are to grow and expand our current manufacturing base and in the long run our property tax rolls.
A vote for this property tax exemption is a vote for the merchants and working men and women of Water Valley and I pray that you give them every consideration as you decide this issue.
Joseph Black, Jr., CPA
CITY OF WATER VALLEY BOARD MEETING
July 1, 2008
1. Call Meeting to Order
2. Approval of Agenda
3. Approval of Minutes
4. Willis Engineering – Airport Grant Invoice $ 16,050.00
5. Town & Country Garden Club – Donation of $ 9,269 to City for purpose of purchasing Trash Containers for various locations within the City Limits
6. Bridge Replacement on Lafayette St – Apprx Cost $ 8,000
7. Zoning: Rodney Phillips on Burks Drive
8. Approval of Donation of Old Mosquito Sprayer to City of Roxie, MS
9. Electric Dept: Approval to purchase mini-truck, (used)
10. Street Dept: Approval to purchase two trucks at State Contract Price
11. Approval to join North MS Mayor’s Assn – $ 350 year
12. Replacement of Frank H. Holloway memorial marker at Fire Dept
13. Jr. Auxiliary Art in the Park Display
14. Burns Law Firm Invoice
15. Advertise for Policemen
16. Tax Exemptions from: Borg Warner
Water Valley Poultry
EXECUTIVE SESSION: To Discuss Personnel Matter(s)