Are State Incentive Packages Too Sweet?

For decades Mississippi has tried to lure companies through development incentive packages. But as MPB's Lawayne Childrey reports one group wants to put an end to the deals.

Governor Haley Barbour has just signed a multimillion dollar bond package benefiting Cooper tires in Tupelo. He says most of the money will go towards a building that's owned by Lee county.

“While we had the most productive work force there were product line that were built at other plants but not in Mississippi. So they needed a place to move these and that means more jobs.”

Some say the money spent on economic development incentives could be put to better use. Sue Hatem is President of the American Federation of Teachers in Mississippi. Her organization recently commissioned a study that suggest better use of the funds.

“They’re not working. We don’t have any sort of oversight and we don’t really know how much money we’re giving out. We need to focus all the funds on education, safer roads and technology.”

According to Gray Swoope, Executive Director of the Mississippi Development Authority, the states investment in Cooper Tire has been well thought out.

“When you have 13 million that the state is issuing in bonds, 7 million for a building, 6 million for a loan. The loan will be paid back. The 7 million for the building, then you look at the economic impact that that will have with the new equipment coming and the taxes that are generated from other purchases here the payback to the state would be very significant probably in the 7 to 8 year time period.”

Economic incentives have been used to draw industries like Toyota, and Nissan to Mississippi. For MPB News, I'm Lawayne Childrey.