DailyMississippian The
thedmonline.com
Tuesday, Aug. 30, 2011
Vol. 100 No. 172
Is Mississippi ready for more big business? BY JOSH PRESLEY joshpresley551@gmail.com
One of Gov. Haley Barbour’s mission statements was creating a landscape friendly to economic development. This includes a push to bring big businesses to the state. Some Mississippians approach the state’s economic upturn with trepidation, however, especially with regard to the local economy. Lyn Roberts, general manager of Square Books, said she feels local businesses must not be pushed aside in favor of big business. “Locally-owned businesses are better for the local economy, and a better local economy makes a better national economy,” Roberts said. But Maggie Toole, a junior mechanical engineering major, disagrees and would welcome larger businesses like retail outlets in Oxford. “I do like the small businesses, especially Square Books,” Toole said. “But big businesses bring in more people and make shopping more convenient.” Toole said there would be more opportunities for her to find a job in Mississippi if bigger companies were brought in. Dale Flesher, associate dean of the School of Accountancy, said a lot of factors must be taken into account when bringing businesses into the state. “There’s a lot to weigh in on it, and it is an accounting decision on both the state’s side and the company’s side,” he said. Flesher said there can be stiff competition between states looking to bring in larger companies. “A company that might want to relocate here is comparing Mississippi to other states and trying to see which state has perhaps the most up-front offers or the lowest taxes in the future,” he said. “You’ve got the same thing on the state side.” One incentive for big businesses is that a fee can be negotiated and paid in place of standard property tax levy for new or expansion projects. This can only happen in a state that has
inside
Oxford resilient in the face of down economy BY LEE HARRIS LTHarris11@gmail.com
Illustration by Cain Madden | The Daily Mississippian
Some Oxonians argue that spending money locally is better for the local economy because more money stays in the area. Data from Civic Economics shows that for every $100 spent at a locally-owned business, 73 percent stays in the area.
a private capital investment in excess of $100 million, according to the Mississippi Development Authority’s website. This incentive is to encourage development with local communities and must be agreed upon by the local board of supervisors and municipal authorities prior to being awarded. The fee can be awarded for up to 10 years but cannot be less than one third of the property tax levy. Flesher said he believes the state should be cautious when offering incentives to companies. “They’ve got to ask how much they’re willing to give away,” he said. “They give the company a tax break or a free tax of some kind for so many years, (but) that factory may be going to use a lot of government resources and so you have to wonder if that’s fair.” Mark Van Boening, associate professor of eonomics, also said he believes states should be
cautious when handing out incentives, but that those incentives are also very important in bringing in businesses. “Tax breaks are widely used incentives, so if you don’t get in that game you’re not going to attract very many businesses,” Van Boening said. “But they are bartering away the future by doing things like loaning them money or providing improvements at the state’s expense.” Van Boening also said there seems to be an emphasis on being business-friendly and that means giving things away. He said there are positives and negatives to bringing in bigger businesses. “There (are) certainly higher-paying jobs and more disposable income, as well as improvements in infrastructure,” Boening said. “In the short term, it can drive up housing prices, the schools can get pretty crowded and they have to widen roads for the traffic with
all these people coming in.” Van Boening said most of the downside is short term, and the idea is that in the long-run the positives will outweigh the negatives. Flesher said the state has to figure out how much it can actually give these companies without hurting the local economy in particular. Senior history major Joseph Kennedy said he can see the logic in both sides of the argument. “You slowly lose the smalltown charm as more big business comes in,” Kennedy said. “But it’s a great way to employ many people and is tax revenue for the area.” Most seem to agree that there are both good and bad sides to bringing in larger companies and bigger business. Despite the various reactions of the residents of the state, the businesses are here and more are coming. Mississippi is growing one way or another.
The national economy is stagnant, unemployment is high and investor confidence is low. However, the construction and expansion of new and existing businesses make it seem as though Oxford defies national trends. Much of Oxford’s stability can be attributed the University of Mississippi. In 2006, the Oxford-Lafayette Chamber of Commerce estimated that the university’s impact on the local economy was more than $733 million. “It’s a tremendous economic engine,” said Max Hipp, president and CEO of the chamber. “Not only do you have the students and the faculty, but you‘ve got all these people coming in to deal with the university.” Although the university provides great economic strength, Oxford still holds a strong allure of its own. Oxford Mayor Pat Patterson not only acknowledged the university’s role in the city’s stability, but also pointed to its quality of life as another reason people continue to come to the city. “Oxford is small, safe and beautiful,” Patterson said. “Just walk around and look. There’s always something to do.” The combination of these factors allows Oxford to continue its expansion even as Mississippi and the rest of the country struggle. Over the last few years, Oxford’s stability has been clearly displayed by key economic indicators. The local unemployment rate in Oxford is 5.5 percent, according to the Tennessee Valley Authority. This rate is considerably lower than the national and state unemployment levels, which are both over 9 percent.
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I don’t think you’d want Oxford to be just like any other place. Because, honestly, it’s an amazing place to be.
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Eddie Lopez , Senior Political Science Major
See ECONOMY, PAGE 5
Ole Miss continues to add non-traditional students
Ole Miss ranks high in SEC tailgate cookoff
Brewers, a family tradition at Ole Miss
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