Bill would give MS auditor more power to keep tabs on industrial projects

By Steve Wilson | Mississippi Watchdog

Since 2009, a half-billion dollars handed out to industry projects by the Mississippi Development Authority hasn’t been subject to the state auditor’s scrutiny.

Now, that might be changing.

House Bill 1318 passed the Senate Tuesday, and if a motion to reconsider isn’t filed it will be headed for Gov. Phil Bryant’s desk. The bill, if passed into law, would give Mississippi Auditor Stacey Pickering the power to examine all of the MDA’s grant programs.

Previously, he could only do a full audit via order from the lLgislature or from the governor’s executive order. The last governor who had every economic development project scrutinized by the auditor’s office was the late Kirk Fordice, who served from 1992-2000.

Pickering said the move would give his office more power to “follow the money” to ensure companies live up to their commitments to the state.

“Did you create (jobs) or did you not? With this new law, we’ll be able to go in and just do an audit,” he said.

Originally, the MDA, which spent $306.9 million last year on tourism and economic development, was limited to allocating money for qualifying business projects via the Mississippi Major Impact Act. Now, there are 13 other programs that aren’t subject to the auditor’s oversight, like the motion picture incentive, the Workforce Training Fund and the Mississippi Industry Incentive Financing Revolving Fund, among others.

At present, the auditor looks at existing companies that have received state grants and tax incentives. The new law would give him the power to perform those same duties on new projects and hold them to the same standard.

Pickering said under the new law his staff could audit the MDA’s jobs program and look for red flags.

“If that happens, we can go do a site visit with the company like we do with (existing companies) like Nissan, Ingalls, Schultz Pipe and the others like Eurocopter, Viking, you name it,” Pickering said. “Nissan shows us their books and we know they’re employing these number of people, this is what we’re paying in salaries and we ask them are they following state law.”

“We verify that and put that out in a report that’s up on our website every year. We do that with all of the major economic programs in this state,” he added.

Pickering hopes the legislation would help prevent costly debacles like the beef processing plant in Yalobusha County that cost Mississippi $34 million in guaranteed loans after it failed in 2004 after three months in operation. The state has recovered more than $617,000, with Pickering recently recovering more than $48,000, since 2005. Six individuals were convicted and served prison time over the beef plant fiasco.

Pickering said the MDA’s role is managing projects, while his is accountability.

“We just want to know if that project is being a good steward of taxpayer dollars. But what we want to head off is fraud, waste and corruption,” Pickering said. “We might be able to prevent situations like the beef plant. If we could’ve gone in, and prevent that from being as bad a loss as it was when we found they weren’t meeting requirements of the state.”

Contact Steve Wilson at swilson@watchdog.org

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