Toyota incentive package zips through Mississippi Legislature

Published 11:19 pm Saturday, March 3, 2007

Mississippi lawmakers on Friday quickly approved a multimillion dollar incentive package to secure a deal that will bring a Toyota plant to northeast Mississippi.

As the Senate took the final votes, Gov. Haley Barbour stood in a nearly empty Capitol hallway and made a brief cell phone call to Dennis Cuneo, a retired Toyota vice president who led the site-selection process that sent the plant to Mississippi over competing sites in Arkansas and Tennessee.

“It’s done,” Barbour said within earshot of a small cluster of reporters and lobbyists.

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Moments later, during a news conference in his office, Barbour recounted the call to Cuneo.

“I could hear his jaw drop and hit his desk that in three hours we had already gotten this fully passed,” the governor said.

Mississippi’s incentive package includes $293.9 million for Toyota, much of which will cover costs for infrastructure such as roads and water and sewer lines for the 1,700-acre site at Blue Springs, near Tupelo.

The package also has $30 million from the state for top-tier Toyota suppliers and $60 million from local governments for land acquisition and water supplies.

Barbour signed the bills Friday afternoon, and they became law immediately.

Barbour and company officials announced Tuesday that Mississippi had been chosen as the site for Toyota’s eighth vehicle assembly plant in North America, part of a growing pattern of auto companies choosing sites in the South.

The $1.3 billion plant will produce Toyota’s new Highlander sport utility vehicle starting in 2010, and company officials say it will have 2,000 jobs, with assembly line positions paying about $20 an hour.

Workers will start clearing trees and stumps from the mostly wooded, rolling hills of the site in the next few days, and Toyota plans to start flattening the site May 1, said Gray Swoope, executive director of the state’s economic agency, the Mississippi Development Authority.

The company plans to start pouring concrete for the plant by September, he said.

The plant will manufacture 150,000 Highlanders a year. It also will create badly needed jobs in an area with an economy that has slowed because of losses in furniture manufacturing and meat processing.

Toyota officials said the company chose to go to northeast Mississippi because they liked what they saw of the education levels and work ethic of prospective employees.

Mississippi officials courted Toyota for 2 1/2 years, mostly out of the public eye. There was little debate among lawmakers Friday about a project that went from a tightly kept secret to one of the biggest news stories in the state in just a matter of days.

Some lawmakers from the impoverished Delta expressed concerns that the Toyota plant might not help their constituents. Some legislators from the Hurricane Katrina-battered Gulf Coast noted that they were supporting a plan that primarily will help north Mississippi, with the hope that a growing economy will boost the entire state.

“I have a Toyota that drowned in Katrina and I replaced it with a new Toyota,” said Rep. Diane Peranich, D-Pass Christian. “I’m happy that Toyota is coming to Mississippi so I can drive a Mississippi Toyota.”

Barbour said this week that Mississippi officials showed Toyota potential industrial sites in Tunica and Como in the northern Delta, near Meridian in the east and near Tupelo. He said company officials chose the site near Tupelo last summer, while still considering sites in other states.

In 2000, when Ronnie Musgrove was governor, Mississippi gave Nissan a $363 million incentive package to lure the state’s first auto manufacturing plant. The Nissan plant opened in 2003 near Canton, about 25 miles north of Jackson and nearly 200 miles south of the Toyota site. The Nissan plant employs about 4,000 people and produced 278,000 vehicles last year.

Barbour, a Republican who defeated Democrat Musgrove four years ago, said the Nissan package did not include incentives for suppliers.

The Toyota plant near Tupelo will be part of what Barbour called a “Southern automotive manufacturing zone” that now includes the Nissan plant at Canton; a Hyundai plant at Montgomery, Ala.; a Mercedes plant at Tuscaloosa, Ala.; a Honda plant at Anniston, Ala.; a Nissan plant at Smyrna, Tenn. He said that “box” of plants should help spur development of suppliers.

“We’re going to pursue suppliers aggressively,” he said. “Because not every place is like Tupelo and the PUL Alliance big enough to have an automotive assembly plant. But every place is big enough to have a supplier that employs 50 or 150 or 500 people.”

The bills are Senate Bill 3215, 3212, 3213, 3214.