Cities, counties urge lawmakers to approve federal stimulus spending amid tax cut standoff

by Geoff Pender, Mississippi Today
March 22, 2022

The leaders of associations representing 299 cities and 82 counties in Mississippi are calling on lawmakers — who are in a stalemate over tax cuts — to move forward on spending billions in federal pandemic stimulus money that could help local governments with historic infrastructure projects.

“The cities and counties of this state are ready and willing to start turning dirt and moving vital infrastructure projects forward through the use of (American Rescue Plan Act) matching grants,” Greenville Mayor Errick Simmons and Choctaw County Supervisor Chris McIntire wrote in a letter to lawmakers on Monday. Simmons and McIntire are presidents of the Mississippi Municipal League and Mississippi Association of Supervisors, respectively.

READ MORE: Mississippi procrastinates as other states plan for, spend billions in pandemic stimulus

“However, we cannot do this without legislative approval,” the two wrote. “We are concerned the federal government could start ‘clawing back’ some of the funds that have not been committed or spent … The clock is ticking on these ARPA funds. We are concerned that if the Legislature waits until 2023 to address the ARPA funds, it could possibly jeopardize the use of some of the fund in Mississippi.”

The two said local governments might run out of time to plan, bid out and complete projects by the Dec. 31, 2026, deadline to have the money spent, particularly given supply chain and inflation issues.

Mississippi cities and counties are receiving a combined $900 million from ARPA. The state is receiving $1.8 billion, and the Senate and House have offered proposals for the state to match local government infrastructure spending to allow for more meaningful upgrades. Many cities and counties have dilapidated water, sewerage, roads and other infrastructure, and the ARPA funds offer what Lt. Gov. Delbert Hosemann has called a “transformational, generational” opportunity.

READ MORE: Hosemann fears federal funds might be lost, squandered in battle over taxes

But Hosemann and his Senate leadership have been at odds with House Speaker Philip Gunn and his leadership over tax cuts. Gunn has been adamant that legislation be passed this year to eliminate the state’s personal income tax, which accounts for about one-third of state general fund revenue. The Senate has proposed a more modest tax cut that still would be one of the largest ever passed by the state.

Gunn and other House leaders have threatened to hold up ARPA spending and other legislation if the Senate doesn’t come around on the income tax elimination plan. Gov. Tate Reeves, who also supports eliminating the income tax, praised Gunn’s threat of holding up ARPA spending as “impressive commitment and a smart move. The taxpayers should be the first to benefit when we have this much money.”

Mississippi is already behind the curve on spending the ARPA money. It is one of just four states, districts or territories not to have allocated substantial amounts of ARPA money to date, along with Idaho, Nebraska, Oklahoma and Washington, D.C., according to data collected by the National Conference of State Legislatures.

Hosemann, who traveled the state meeting with local government leaders and held hearings in the summer and fall of 2021 to plan ARPA spending, has urged Gunn and the House to move forward on it.

In an op-ed column he penned over the weekend, Hosemann said: “Let me be very clear: failing to appropriate the one-time $1.8 billion in federal American Rescue Plan Act funds for infrastructure and recovery projects is not a rational option for our state.

“Yet, last week members of the state House of Representatives made public comments hinging the allocation of these one-time dollars on the passage of unrelated legislation.

“… Meanwhile, the citizens and communities who elected us are in limbo, waiting for this critical funding to increase the number of available hospital ICU beds, extend broadband service to rural areas, support child protective services, and boost our economy through workforce development and tourism.

“The Senate hit the ground running in January, having already met with stakeholders, held public hearings, and developed an initial ARPA plan before the Session started. This is because the clock is ticking. Mississippi does not have time to wait.”

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.