Meridian City Hall

Meridian City Hall

With revenue stagnant across the city, some Meridian City Council members questioned the city's practice of granting ad valorem taxes to businesses promising jobs or expansion.

"It's good to encourage business," George Thomas, of Ward 1, said. "At the same time... we need all the revenue we can get. Hopefully, by giving out these exemptions, it'll generate enough jobs to justify this."

Local businesses can request the city waive ad valorem taxes for a fixed period by detailing their workforce expansions or equipment purchases, as written in state law. Both Van Zyverden, Inc. and Magnolia Steel Co., Inc. requested five-year ad valorem tax exemptions from the council Tuesday.

Weston Lindemann, of Ward 5, said he didn't see evidence that these tax exemptions had generated jobs. 

"I think we've got to draw the line somewhere," Lindemann said. "We're taxing the citizens more to make up revenue because we gave it all away to these businesses."

Kim Houston, of Ward 4, joined the council via conference call and asked the city's finance department to supply a list of all people receiving tax credits, how much they receive and when those credits expire. Lindemann asked to add hotels, specifically, to that report.

"Van Zyverden has (said they) bought new equipment that enabled them to hire more people," Thomas said. "We want to do what we can to help (offset that) but the city has to consider their revenue... we have to look at what we're giving and who we're doing it for."

Thomas said that companies such as Van Zyverden had given back to the community, an important aspect to consider in ad valorem taxes for him.

"(They've) been a good community partner in things that make our city a better place to live. Van Zyverden has continually done that," Thomas said. "Those kind of things are what I look for... (but) I'm very concerned about the amount of property taxes that are written off in the City of Meridian."

Churches, non-profits and government entities don't pay property taxes, meaning much of the property throughout Meridian, and especially downtown, isn't taxed because it's owned by the City of Meridian, Lauderdale County, Mississippi State University-Meridian, Mississippi Arts + Entertainment Experience, or the Children's Museum. 

Thomas said that's why he supported moving forward on the industrial park on Sweet Gum Bottom Road as soon as possible.

"The industrial park has got to counteract all of that," Thomas said. 

Lindemann voted against giving both businesses the tax exemption.

"There are companies that, every five years, they come back for another tax break," Lindemann said. "We act like there some correlation between doing that and job growth but I haven't seen any evidence of that. It just shifts the tax burden to the homeowners of Meridian."

Lindemann said that companies such as Van Zyverden had already expanded before asking for a tax break and that the federal government credited business for their charitable work locally. 

"I think we should look at repealing all of it, if it's legal," Lindemann said. 

Lindemann said he wanted to look at credits for companies that eliminated kudzu, which contributes to ozone pollution through the release of nitric oxide, a greenhouse gas. He said this incentive would be a unique way to attract companies looking to have a greater environmental impact.

"I also have to wonder, do small businesses have the same opportunity to get that tax credit?" Lindemann said. "Because if you talk to small businesses, getting that could mean hiring more people."

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