Within four years, Marion County will get an estimated $583,026 annually from internet sales tax collections for repairing roads and bridges and Columbia will receive $291,905.
That’s the result of an infrastructure bill the legislature passed during a special session this week.
“This is going to be good for the cities and the counties altogether,” State Rep. Ken Morgan, R-Morgantown, said Tuesday. “We could have already had this thing in place because this is almost, not quite but almost, an identical bill of what passed in the House and sent over to the Senate during the regular session and they didn’t take it up.”
The House voted 111-4 in favor of the Mississippi Infrastructure Modernization Act of 2018 and the Senate voted 48-3. All of the Marion County delegation – Morgan, State Rep. Bill Pigott and State Sen. Angela Hill – voted for the plan.
It divides up part of the 7 percent tax the state collects on internet purchases to local governments specifically for roads and bridges. Cities get 15 percent, counties get 15 percent and 5 percent goes to the state’s bridge fund for counties.
It’s phased in over four years. That means the cities and counties will gradually get a higher percentage of the tax collections.
The totals for Marion County and Columbia are estimates based on what the state expects to collect by 2022 from internet sales. The U.S. Supreme Court court in a 5-4 June vote in the South Dakota v. Wayfair case approved states to collect a use tax, essentially a sales tax, on out-of-state purchases by residents even if the seller doesn’t have a physical presence in the state.
That decision cleared the way for road funding after the state House and Senate had been at a standstill for three years. The Senate and Lt. Gov. Tate Reeves relented and approved a plan similar to what the House wanted.
For cities, the money is divided up:
• $3 million to all of the state’s roughly 300 municipalities in equal shares, which comes out to about $10,000 per city.
• Of the remainder, half goes based on population size and half based on sales tax revenue.
For counties:
• One-third is divided up equally among all 82 counties
• One-third is done based on number of rural road miles
• One-third is based on the total rural population (people in the county who don’t live within a cities limits).
Cities and counties will get the money twice a year, in January and July.
Morgan said there’s a stipulation in the bill that municipalities can’t let the funds build up year after year.
“You have to be using that money to be receiving the money. If you’ve got $100,000 left in there, you might not get your money next year if it’s still sitting there,” he said. “What it is is they’re wanting to put those wheels in motion.”
To receive the state money, cities and counties must spend at least as much locally on roads and bridges as the amount they get from the state. That’s intended to prevent municipalities from cutting what they previously spent on infrastructure once state dollars come in. In most cases, cities and counties are already spending well above those amounts, so that stipulation is unlikely to affect funding in most cases.
How much for roads?
Mississippi cities and counties will get 3.75 percent each of internet sales taxes collected statewide in 2019 and then increasing each year by that amount until it reaches 15 percent in 2022. Here’s estimates of what that will bring in locally:
2019
Columbia, $72,976
Marion Co., $145,802
2020
Columbia, $145,952
Marion Co., $291,603
2021
Columbia, $218,928
Marion Co., $437,405
2022 and beyond
Columbia, $291,905
Marion Co., $583,026
