JACKSON- Today, the Performance Audit Division of the Office of the State Auditor released the quarterly “Economic Development Bond Monitoring Quarterly Report.” You can view it here.
The Office monitors the expenditure, employment, construction, and in some cases, the productivity of a number of State-funded major economic development projects.
The Economic Development Bond Monitoring Quarterly Report
In recent years, the Legislature has begun using alternate avenues to codify economic development bond projects—the Mississippi Industry Incentive Financing Revolving Fund (MIIFRF) (’57-1-221) and the Mississippi Advantage Jobs Act (’57-62 et al, MS Code of 1972, Annotated). Neither the Act nor the establishment of the MIIFRF provides the authority for the OSA to audit any of these projects.
During the 2013 Regular Session, two pieces of legislation (HB 473 and SB 2686) was introduced (but died in the Senate Accountability, Efficiency, Transparency committee) that would have provide the authority for OSA to better monitor and audit the economic development incentives provided by the State. Failure to provide OSA with the authority to audit such private recipients of taxpayer dollars was how the MS Beef Processors failure occurred without warning.
The Legislature established the MMEIA to assist with the recruitment of major economic projects into the State and to provide incentives to those companies choosing to conduct business in Mississippi. Under MMEIA, the State Bond Commission is given the power to borrow money and issue general obligation bonds to the projects the State declares as major economic projects. Bonds are defined in MS Code §57-75-5 as …general obligation bonds, interim notes, and other evidences of debt of the State of Mississippi…Borrowing money and issuing bonds for the purpose of these projects should serve valid public purposes that significantly contribute to the employment base and growth in the State revenue and employment opportunities. These projects are to be designed to benefit the people of the State to improve and promote community welfare and prosperity.
Under MS Code §57-75-5, 27 economic development projects were approved to receive general obligation bonds. To date, there are 11 active programs under MS Code §57-75-5. Some of these projects have consisted of industrial, pharmaceutical, and automotive manufacturing, etc. Which are expected to create jobs and make an initial capital investment into the project sites.
The Legislature has given the OSA the responsibility and authority to conduct audits; to ensure the taxpayers’ funds expended for these projects have been used appropriately; jobs promised have been created; and private investment commitments have been made. This specific duty was authorized by the Legislature under §§57-75-5 and -15, MS Code of 1972, annotated. The PAD’s ultimate goal and responsibility is to provide objective oversight and monitoring of these projects.
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