City officials are trying to work out a way to get what they believe is their share of the $300,000 Toyota Motor Manufacturing Mississippi is giving to Union County annually for education. For now, the county is getting the entire amount.
Part of the commitment Toyota made to the Pontotoc-Union-Lee County PUL Alliance in coming here was to pay the member counties approximately $900,000 each year in lieu of property taxes normally designated to fund the schools. One-third was to go to each county for school use.
Complications arose, however, because the circumstances for Union County were different from the other two. Supervisors in Lee and Pontotoc Counties had the option of allocating their $300,000 however they wanted because no part of the Toyota plant was actually within their county boundaries, and technically the auto manufacturer owed no tax in the two. That made the payment something of a gift to them.
The plant is in Union County, however, entirely in the county school district and not in the city separate district. It appeared that the entire amount would go to the county school district.
City school officials argued that it would be unfair for them to not get any of the money when the two other counties were giving funds to city schools.
The county asked for an official opinion from the state attorney general’s office and one was issued Nov. 15, although local officials were apparently not notified at that time. They finally learned of the opinion this past week.
The opinion quoted a couple of sections of state law but, simply put, the opinion said the county supervisors have no authority to allocate county school tax money to a municipal district, directly or indirectly.
City School Superintendent Jackie Ford said he learned of the opinion after reading about it in the newspaper.
“It’s just not fair for the New Albany District to be the only one not getting the PUL money,” Ford said.
While he said he has had no communication about the issue with county officials, he has talked with New Albany aldermen about how to get their share.
“It looks like a local and private bill is the only way, but there’s not much hope for it this year,” he said. The deadline to introduce such a bill is Feb. 26 and Ford said they have learned one would have little chance of passing without being supported by a resolution signed by all interested parties.
Ford doesn’t seem to think there was a deliberate plan to keep money from the city schools. “The agreement was written fairly quickly,” he said. “I don’t think there was intention to single anyone out.”
One fair way to divide the money as suggested by Ford would be on a per-student basis. “That would give us $135,000 a year,” he said. “That might not sound like much but over 10 years that would be $1.3 million.”
The in-lieu-of-tax payments have no connection with the $50 million gift Toyota agreed to provide to enhance education in the eight school districts in the PUL counties. The education endowment fund was a voluntary gift by Toyota to be paid in $5 million installments over a ten-year period.
This is not the first time a question of city versus county school tax benefits has come up.
Ford pointed out the Diversity-Vuteq auto parts plant has part of its building in the city district and part in the county. “I think it’s 88 percent in the city and 12 percent in the county,” he said, and their tax money is divided proportionately.
Years ago, the ill-fated Enron natural-gas demand power plant was placed outside the city but was still in the city separate school district.
“But both of those were only local bills,” Ford said. “Toyota with the three-county PUL Alliance had to have state approval. And the Wal-Mart Distribution Center was in the county district but they trained in the New Albany schools and we did not charge them and got no tax.”
Ford is still hoping for a legislature solution and optimistic something can be worked out to give the city schools what they believe is a fair share. “If not this year, then next year,” he said.
The agreement to allow in-lieu payments instead of taxes lasts 10 years, after which the company will pay regular ad valorem taxes.