Legislative Session Week 2 update from MCBL&F member Camp Murphy with Capitol Resources, LLC. See below.
Highlights from the 2nd Week of the Mississippi Legislature
MS House Sends Tax Cut Bill to Senate
HB 1 Phases out Income Tax, Cuts Grocery Tax while Increasing Other Sales Taxes; also Funds Highways and Transportation Infrastructure and Shores Retirement System
House Bill 1 Passes with Bipartisan Support
The Mississippi House of Representatives, with some bipartisan support, adopted a comprehensive net $1 billion tax cut bill that would over a decade eliminate the state’s income tax and shift some tax burden toward consumption: namely sales taxes. The bill passed on Thursday with an 88-24 vote, setting the stage for what could be a significant shift in the state’s tax policy. Authored by House Ways and Means Chairman Rep. Trey Lamar and other House leaders, the bill proposes a phased elimination of the state income tax, coupled with changes to grocery, sales, and gasoline taxes. While nine Democrats joined Republicans in support, other Democrats expressed concerns over the bill’s impact on future spending.
Key provisions include:
A gradual reduction of the 4% income tax rate, eliminating it entirely within 10 years.
A new 1.5% local sales tax (opt-out option) raising the overall rate to 8.5%.
Gradual reduction of the sales tax on groceries from 7% to 2.5% over a decade.
A new 5% sales tax on gasoline at the pump to fund transportation infrastructure, adding an estimated $400 million annually.
Shifting $100 million in lottery funds annually from transportation funding to the state’s Public Employees Retirement System, which actuaries have warned needs a cash infusion and restructuring of benefits for new hires.
Gov. Tate Reeves, who has long called for elimination of the state’s income tax, lauded the legislation and urged the State Senate to join the House in adopting the proposal. Senate leaders have signaled their intention to offer their own tax cut proposal.
Mid-Term Redistricting Looms as ACLU Redistricting Proposal Sparks Debate
The Mississippi ACLU and NAACP submitted a proposal to the courts to redraw legislative districts in compliance with a federal court order, creating two additional majority-Black Senate districts in DeSoto County and HattiesburgLawmakers had already redrawn all districts based on data from the 2020 Census, but a court ordered them to create two new state Senate and one new state House districts with a majority of racial minority voters.
The plan submitted by the ACLU and NAACP would also impact the House by turning Chickasaw County’s District 22 into a majority-Black district. Their redistricting plans would place Republican senate incumbents in DeSoto County and Hattiesburg against each other, further intensifying political stakes. House and Senate leaders are expected to release their own plans, aiming to satisfy federal mandates by the end of the 2025 session while keeping most incumbents largely intact.
Regardless of which plan the Court adopts, as many as a dozen of the 52 senators (mainly in and around DeSoto and Forest counties) and three to six members in the 122-member House, mainly around Chickasaw County, could find themselves seeking reelection later this year in specially called elections. Any Legislative plan would require adoption of a joint resolution by the House and Senate and ultimately the federal courts.
Leadership Changes in Senate Committees
Lt. Gov. Delbert Hosemann reshuffled several committee chairs in the wake of a vacancy created by former Senator Jenifer Branning’s election in November to the state Supreme Court. Hosemann appointed:
Highways and Transportation:Sen. Chuck Younger (R-Columbus) to chair of the Transportation Committee, which Branning had chaired.
Agriculture Committee: Sen. Neil Whaley (R-Potts Camp) will chair the committee that had been chaired by Younger.
Wildlife, Fisheries, and Parks Committee: Sen. Ben Suber (R-Bruce) will chair the committee that had been chaired by Whaley.
Public Property Committee: Sen. Bart Williams (R-Starkville) will chair the committee that was chaired by Suber.
Technology Committee: Sen. Scott Delano (R-Biloxi) will chair the committee that had been chaired by Williams.
Environmental Protection, Conservation and Water Resources: Sen. Jason Barrett (R-Brookhaven) will chair the committee that had been chaired by Delano.
US Navy to Name Ship for former MS Gov. Ray Mabus
The US Navy announced that a destroyer to be built at Mississippi’s Ingalls Shipbuilding will be named for former Mississippi Governor Ray Mabus, who served as governor from 1988-92. Mabus, a Navy veteran, was appointed by former President Obama to serve from 2009-2017 as Secretary of the Navy.
What’s Next:
Introduction deadline Monday: Lawmakers arrive back in Jackson Monday, Jan. 20th facing a deadline to introduce general legislation. (The deadline for appropriations and tax legislation is later this session). House and Senate leadership are working to assign bills to committees and entering them into the system. Your CR Team is reviewing and tagging bills for you as they appear, but please let us know about any bills you hear about that may be of consequence.
Committee Deadline: After Monday Jan. 20th, the next major deadline is Feb. 4th. General bills must be approved by the committee(s) to which they were assigned in their chamber of origin.
Weather Watch: Legislative leaders are watching forecasts for sub-freezing weather this week and potential precipitation in case icy road conditions in parts of the state disrupt their workweek.
Full deadline calendar can be found here
