fbpx
Connect with us

Mississippi Today

Are revenue collections already slowing as state leaders consider massive tax cut?

Published

on

Are revenue collections already slowing as state leaders consider massive tax cut?

Mississippi's historic growth in state tax collections is slowing — at least for a month.

This past month the state collected $518.8 million in taxes and other revenue compared to $531.9 million in November 2021.

Does the November revenue represent the start of a slowdown in Mississippi tax collections that have grown at an unprecedented rate for more than a year?

Advertisement

It is a fair question? After all, Gov. Tate Reeves, House Speaker Philip Gunn and others are citing the unprecedented growth in state revenue as a reason to enact a tax cut that will take about $2 billion yearly out of state coffers.

The November report recently released by the staff of the Budget Committee represents the first slowdown in monthly revenue collections for the state since July 2021 when tax collections were less than the amount collected a year earlier in July 2020.

Granted, folks who study Mississippi revenue collection trends are fond of saying that one month does not a trend make. The state saw increased collections for 16 months after that slowdown in July 2021. So, there is a good chance that the collections will bounce back in December.

But as sure as night follows day, the slowdown in Mississippi tax collections eventually will occur. History tells us that.

Advertisement

Revenue grew by 9.54% during the fiscal year that ended on June 30 and by an unprecedented 15.9% the previous year.

The result of the strong growth is that the state has a revenue surplus of $3.9 billion going into the 2023 legislative that begins in early January. Having $4 billion in reserves is staggering considering the total state support budget, which consists primarily of general tax collections, such as the sales tax on retail items and the income tax, is $7.86 billion for the current fiscal year.

A small portion of those reserve funds, about $450 million, are federal relief funds and money from lawsuit settlements, but most of the funds are the result of a boon in state tax collections.

The net result of those large reserves is that state political are feeling pretty good and bragging on their governance prowess.

Advertisement

“We are in a great financial position,” Gunn, R-Clinton, said recently, echoing similar comments of Reeves.

“We can't neglect or ignore the fact that conservative spending led to this type of financial situation,” Gunn continued. “We have rejected the attempts to grow over the last many years and this (revenue surplus) has been the result of that.”

That is all well and good except for the fact most states have had similar unprecedented surpluses. California, for example, a state that Mississippi politicians like to criticize for its liberal policies, had a whopping $98 billion surplus, though, it appears that the Coast state's tax collections already are slowing.

But before slowing, California provided one-time rebates of between $200 and $1,500 to individuals earning less than $250,000 and to households earning less than $500,000.

Advertisement

Multiple states, controlled by and Democrats, have provided rebates.

In Mississippi, the taxpayers have not yet reaped any direct cash benefits from the massive surplus. In the 2022 session, legislators approved the largest tax cut in state history – a $525 million cut to the income tax. But that tax cut will not be fully phased in until 2026. Taxpayers can a small monthly benefit from the tax cut starting in January if they change their payroll deductions. Otherwise, taxpayers will receive no benefit from the tax cut until they file their tax returns in early 2024.

Lt. Gov. Delbert Hosemann has proposed the Legislature provide a rebate in the 2023 session. Reeves and Gunn are proposing the complete elimination of the income tax. Such a cut will take an additional $2 billion out of the state treasury on top of the $525 million tax cut made last year.

During much of the 1990s, thanks to the start and incredibly rapid expansion of casino gambling, Mississippi experienced a prolonged period of historic revenue growth.

Advertisement

But by the early 2000s, as a recession hit the country that was especially bad in Mississippi, the Legislature and then-Gov. Ronnie Musgrove were having to cut budgets.

That is not to say that the Legislature and governor should not look for innovative ways to spend the surplus for the betterment of the state and its citizens.

A reasonable debate can be had on whether it is better to return funds to citizens or use the surplus to address the litany of problems facing the state. But it is safe to assume tax cuts that take more than $2.5 billion yearly out of state coffers will have a lasting impact, especially when revenue collections slow as they most assuredly will.

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

Advertisement

Mississippi Today

State revenue is sluggish, but interest from federal COVID-19 money is buoying budget

Published

on

Mississippi is collecting enough money to fund the current year's budget passed by the in 2023 — largely due to interest earnings on federal money — but tax collections remain sluggish.

April's revenue, just released by the staff of the Legislative Budget Committee, was $6.87 million or 0.65% over the estimate. But actual tax collections were $1.3 million below the estimate.

The reason total revenue for April was above the estimate is the interest earnings the is garnering on its surplus money. For the month of April, interest earnings were $8.2 million above the estimate, thanks to the unprecedented amount of surplus money largely from federal COVID-19 spending and because of high interest rates.

Through April, the first 10 months of the fiscal year, interest earnings are $93.4 million above the estimate. Interest earnings are more than half of the total collections above the estimate of $185.8 million for the year.

For the fiscal year to date, revenue is .39% or $24.7 million above the previous year. Without interest earnings, the state would be collecting less revenue that it did the previous year.

Advertisement

The sluggish collections for April was released just as the Legislature was finalizing a budget for the upcoming fiscal year, which begins July 1.

For the upcoming fiscal year, the budget, all state funds, will be $7.28 or $583.2 million more than was budgeted for the current fiscal year. That number excludes the use of surplus funds to pay for one-time construction projects throughout the state.

Kindergarten through 12th grade education will $246 million or 8% of the increased funds while universities will receive an additional $60.8 million or 7.5% more than they received for the current year. Community colleges will receive an additional 18% or $53 million.

The Legislature is in an unusual position of being able to make record expenditures even as revenue collections appear to be slowing, thanks, in large part to COVID-19 relief funds and other federal funds.

Advertisement

But many legislative said during the just completed that they will continue to monitor collections that could impact budgeting in future years if the trend continues.

For the year, state income taxes are down $131.2 million or 6.6%. That, according to state Economist Corey Miller, is attributed at least in part to the $525 million income tax cut that currently is being phased in over a four-year period. Sales tax collections are up $71.7 million or 3.2%.

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

Continue Reading

Mississippi Today

Ex-Mississippi sheriff admits lying to the FBI

Published

on

mississippitoday.org – Jerry Mitchell and Ilyssa Daly – 2024-05-07 11:40:49

As sheriff, Terry Grassaree stoked fear into the citizens of Noxubee County by imitating his idol, wrestler “Stone Cold” Steve Austin.

On Tuesday, the 61-year-old former enforcement officer spoke in a soft voice to District Judge Daniel P. Jordan III as he pleaded guilty to lying to the FBI when he denied that he made a jailed woman take and share sexually explicit photos and videos of herself.

He faces up to five years in prison and a $250,000 fine when he is on Aug. 7.

Advertisement

Assistant U.S. Attorney Kimberly Purdie told District Judge Daniel P. Jordan III that Grassaree lied to an FBI agent on July 13, 2020, about making a woman behind bars take and share nude photos and videos in exchange for favorable treatment, which included making her a jail trusty.

After she texted the photos from a contraband cell phone, he responded, “Butt is great” and “Body looks perfect.”

Standing next to his attorney, Abram Sellers of , Grassaree admitted all of what Purdie had said was true.

Grassaree was also charged with destroying evidence and wire fraud. If he had pleaded guilty to all of his charges, he could have faced up to 90 years in prison.

Advertisement

But his story goes far beyond what the former sheriff pleaded guilty to on Tuesday.

The Mississippi Center for Investigative Reporting at Mississippi Today and The New York Times highlighted Grassaree in its , “Unfettered Power: Mississippi Sheriffs,” which showed how sheriffs can rule like kings in rural counties. They answer to no one and typically face little press or prosecutorial scrutiny.

The investigation published April 11, 2023, revealed that the allegations of wrongdoing against Grassaree have been far more wide-ranging and serious than his federal charges suggest. The investigation included a of nearly two decades of depositions and a previously undisclosed by the Mississippi Bureau of Investigation.

At a minimum, the documents detail gross mismanagement at the Noxubee County jail in Macon that repeatedly put female inmates in harm's way. At worst, they tell the story of a sheriff who operated with impunity, even as he was accused of abusing the people in his custody, turning a blind eye to women who were raped and to cover it up when caught.

Advertisement

Over nearly two decades, as allegations mounted and Noxubee County's insurance company paid to settle lawsuits against Grassaree, prosecutors brought no charges against him or others accused of abuses in the jail. A federal investigation dragged on for years and finally led to charges in fall 2022.

In a 2020 lawsuit, Elizabeth Layne Reed accused two deputies, Vance Phillips and Damon Clark, of coercing her into having sex. She said the gave her a cellphone and other perks in exchange for sexual encounters inside and outside the jail. Deputies even put a sofa in her cell.

According to her lawsuit, Grassaree knew all about his deputies' “sexual contacts and shenanigans,” but the sheriff did nothing to “stop the coerced sexual relationships.” 

Grassaree has previously denied any knowledge of what his deputies were doing. “Are you a boss?” he asked. “Do your employees tell you everything they do?”

Advertisement

Instead of intervening, the lawsuit alleged, the sheriff “sexted” her and demanded that she use the phone the deputies had given her to send him “a continuous stream of explicit videos, photographs and texts” while she was in jail. She also alleged in the lawsuit that Grassaree touched her in a “sexual manner.”

The lawsuit was settled for an undisclosed amount.

No date has been set for the sentencing of one of those deputies, Phillips, who pleaded guilty last year to bribery, which experts say could have been the perks the woman says she received. Prosecutors asked for his sentencing to be postponed “pending a resolution of another criminal matter,” an obvious reference to Grassaree's case.

The other deputy, Vance, wasn't charged. “I never coerced Reed into sex,” he wrote in his response to the lawsuit, but he never answered whether he had sex with her.

Advertisement

Under Mississippi law, it is a crime for officers to have sex with those behind bars, and the felony carries up to five years in prison.

Nearly two decades ago, Grassaree faced allegations of rape inside the jail that he supervised and lawsuits claiming that he covered up the episodes. At least five people, including one of his fellow deputies, accused him of beating others or choking them with a police baton.

In 2006, after Grassaree and his staff left jail cell keys hanging on a wall, male inmates opened the doors to the cell of two women inmates and raped them, according to statements the women gave to state investigators. One of the women said Grassaree pressured her to sign a false statement to cover up the crimes, according to the state police report.

About a year later, in a lawsuit, four people who had been arrested gave sworn statements accusing Grassaree of violence. Two of the people said he choked or beat them while they were in his custody. A third said he pinned her against a wall and threatened to let a male inmate rape her.

Advertisement

All told, at least eight men — including four deputies and Grassaree himself — have been accused of sex abuse by women inmates who were being held in the Noxubee County jail while Grassaree was in charge.

Now, 18 years after a woman first said that he pressured her to lie about being raped, the former sheriff faces possible prison time.

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

Continue Reading

Mississippi Today

On this day in 1955

Published

on

mississippitoday.org – Jerry Mitchell – 2024-05-07 07:00:00

May 7, 1955

George W. Lee Credit: Wikipedia

The Rev. George Lee was shot to in Belzoni, Mississippi, after using his pulpit and his printing press to urge other Black to vote. 

He became one of the first African Americans to register to vote in the mostly Black Humphreys County. And when he helped register more than 90 other Black voters, White spoke with concern over growing African-American power in the Mississippi Delta. 

Lee continued his work in the face of threats and electrified crowds of thousands with his speeches, according to Jet magazine. 

Advertisement

“Pray not for your mom and pop,” he told the crowd. “They've gone to heaven. Pray you can make it through this hell.” 

Weeks later, shotgun blasts hit Lee in the face as he was driving home one night, and his Buick smashed into a house. The sheriff claimed the pellets found in his shattered jaw were fillings from his teeth. 

Mississippi NAACP Field Secretary Medgar Evers investigated the killing, and FBI tests concluded the pellets were buckshot. No one was ever prosecuted. 

More than 1,000 attended Lee's funeral, and his widow, Rosebud, decided to open the casket to show how her husband had suffered. Photographs of his body ran in Jet magazine. A few months later, Emmett Till's mother would do the same for her teenage son when he was killed. 

Advertisement

Lee is among 40 martyrs listed on the Memorial in Montgomery, Alabama. A in Belzoni now bears his name and that of civil rights leader Fannie Lou Hamer.

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

Continue Reading

News from the South

Trending