It’s time to look at the Good, the Bad, and the Ugly of this year’s legislative session through Bigger Pie Forum’s lens of enhancing opportunity and reducing barriers to growth in Mississippi’s economy.

The Good

We start with some minor victories for taxpayers related to gifts that can be accepted by regulatory agencies from the people or companies they regulate.

HB 1664 offers some clarification to the prohibition on gifts and campaign contributions that may be given to or received by a Public Service Commissioner or the Public Utilities Staff. This was prompted by 2023 campaign contributions to now-former commissioners Brandon Presley and Brent Bailey from solar power producers from other states.

HB 1664 doesn’t mention solar producers specifically, but it does reference another section of law where the definition of an electric public utility includes “the generation, manufacture, transmission, distribution, provision, or furnishing of electricity to or for the public,” which should cover solar. It also adds a prohibition against gifts or contributions from anyone “acting at the request or direction” of a public utility. That addresses the concern that solar companies operating in Mississippi may have asked solar companies in other states to make contributions the Mississippi companies might not be allowed to make.

HB 1664 also adds a prohibition against gifts or campaign contributions from anyone who has participated in a PSC proceeding in the four years preceding the gift or contribution. The goal of all these prohibitions, of course, is to limit the conflicts of interest that could influence decisions by the PSC.

HB 1471 creates a similar prohibition on gifts to officers or employees of BEAM, the Office of Broadband Expansion and Accessibility of Mississippi, which provides grants to broadband service providers to deploy broadband access in unserved or underserved areas.

In the “shouldn’t be necessary, but it is” category, HB 1583 prohibits any ordinance, building code, or other policy that restricts or prohibits anyone from using an appliance based on the type of utility service required to operate the appliance. This is to preempt what we have seen in other states where local governments are prohibiting the installation of appliances that use natural gas or other fossil fuels.

SB 2059 stipulates as a matter of law that energy produced from biomass (mostly forest product residuals) or from agricultural harvesting is considered renewable and carbon neutral. When the bioenergy is paired with carbon capture and storage, the bioenergy is carbon negative.

SB 2072 allows physical therapists to perform physical therapy on patients without a prescription or referral from another health professional if the physical therapist has a doctorate in physical therapy or has five years of licensed clinical practical experience.

The Bad

SB 2557 calls for Mississippi State or Alcorn State to lease land at one of their branch experiment stations for up to 50 years for a “solar installation.” This provision was added to the section of law declaring that agriculture “is the primary industry of Mississippi” and that research should be expanded in livestock, poultry, soil conservation, forestry, plant testing, and a variety of other fields, none of which will occur on the vast acreage occupied by a solar installation. To its credit, however, the legislature did mandate that the lessee (presumably a solar company or utility) will be required, at the end of the lease or at the abandonment of the project, to remove everything it installed and pay all costs to return the property to the condition it was at the beginning of the lease term.

The Ugly

The legislature held two special sessions in January for economic development projects. The legislature was already in its regular legislative session, but for each of these projects, the governor used his powers under the Mississippi Constitution to call a special session where he sets and limits the agenda, thus allowing expedited consideration of the items on that agenda. These are generally referred to as a “special session within the session.”

In the first special session, the legislature approved up to $482 million for a factory that is intended to produce battery cells for electric commercial vehicles, primarily big-rig trucks, and industrial applications. We say “intended to produce” because the factory is being built at a time when major car manufacturers are cutting back on their electric vehicle (EV) production due to a less-than-enthusiastic reaction from car buyers. The additional cost, distance limitations, charging time requirements, and other issues are likely to be just as, if not more, prohibitive in the truck market.

In the primary bill for this project, the manufacturing and assembly of battery cells doesn’t have to begin until December 30, 2029. By that time, unless there is an unexpected breakthrough in battery technology, there might be little demand for these batteries.

In addition to the money, the state is providing for everything from site preparation to utilities to job recruitment and training, and a myriad of other expenses, the bill exempts the project from a variety of laws, including bid requirements in procurement rules. For highway construction, public agencies are “authorized to use any method for…construction procurement and contracting.”

It also exempts the project from the state’s prohibition against foreign ownership of more than 320 acres of land for the purpose of industrial development. A Chinese-owned company is part of the joint venture of four companies, which includes Daimler Trucks, PACCAR, and a division of Cummins, which will each own 30% of the company, and the Chinese-owned company which will own 10%.

The second special session was called to assist the Amazon data center project. While we are not critical of the project or the legislature’s action in general, this bill is listed in the “Ugly” section because of the breadth of a section of the main bill for this project. Sec. 22 exempts from Public Service Commission (PSC) approval almost every aspect of the agreements between Entergy and Amazon.

Although the legislature was told that these agreements will result in a more reliable grid and stable prices for consumers, the PSC has no way to ensure that happens, and they are powerless to do anything about it if it doesn’t happen. And for this project, Entergy is exempt from procurement laws that normally apply to electric utilities, which might also drive up the price that Entergy eventually passes on to regular ratepayers.

The final two Ugly designations are things the legislature didn’t do. In both cases, bills were alive until the end of the session to solve major problems, but legislators chose – again – to kick the can down the road instead.

We have published many articles on the need to make major changes to the Public Employees Retirement System (PERS). The House passed HB 1590 that took a significant step in the right direction. It would have required the board, which is currently made up entirely of PERS beneficiaries, to have representation from taxpayers, who pay the cost of PERS as the “employer” of public employees.

That bill could have been written in a way that didn’t reduce the number of PERS board members elected by PERS members but simply added a number of non-beneficiaries. However, rather than making that change – or any others – to the House bill, a Senate committee chairman chose not to call the bill up for any amendments or for a vote, so it died.

After another bill was considered and died, an agreement was finally reached, and the legislature passed a resolution to allow a new bill to be introduced long after the normal deadline for introduction of bills. The resulting SB 3231 does nothing to the composition of the PERS board. It implements a 2.5% increase, in five installments of 0.5% per year, in the employer (meaning taxpayer) contribution. That will put the taxpayers’ contribution at 19.9% of employees’ salaries. In a separate bill, the legislature appropriated $110 million to the PERS retirement fund, which currently faces a $19 billion unfunded liability.

The other issue the legislature neglected to address is the health care Certificate of Need, which limits – and in some cases prohibits – competition among providers of healthcare services of many kinds. HB 848, which would remove the need for a CON for alcohol and drug treatment facilities, intermediate care facilities, and for psychiatric residential treatment facilities passed both houses, with only slight differences. In the end, however, no bill was finalized.

 

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