Furniture industry leaders, along with House Speaker Billy McCoy, said Tuesday they were surprised and disappointed by Gov. Haley Barbour’s veto of a bill that would have provided tax credits for the furniture industry.
But the furniture officials said they would continue to fight for the incentives that they insist will save jobs.
On Monday, Barbour said the credit proposal would have cost a battered general fund budget about $11 million this year.
The governor also said that the state tax credit law was designed to encourage newer, higher-paying jobs, and that the furniture incentives bill did not do that.
Ken Pruett, president of the Mississippi Furniture Association, said he was caught off guard by the veto.
“I’m shocked. We’re all shocked, and we’re all disappointed,” Pruett said. “We never heard a word about any hang-ups about the legislation until it got to the governor’s desk. We don’t know why if there were questions why they weren’t mentioned until now.”
In his veto message, Barbour said that in addition to hurting the state budget, the bill “singles out the furniture industry but would not cover other important Mississippi businesses, which are also struggling.”
Greg Roy, new president of Lane Furniture, said he, too, was disappointed with the veto.
“It’s disheartening,” he said. “We had folks that were involved with the legislation, and we’re supportive of anything that can save American jobs, especially jobs in Mississippi.”
Proponents of the incentives bill said the $2,000 tax credit for each cut-and-sew job would help save the 4,500 remaining jobs in the state and potentially bring back another 1,500 from overseas.
McCoy, a Democrat from Rienzi, also saw the bill as a chance to help a struggling but important industry.
“All of us have agreed to give millions of dollars in tax breaks to businesses and industries during the current administration,” McCoy said.
“Here is an industry that has been here 50 years making a difference for the state and the nation. It was just asking for a little of that.”
A Mississippi State University study said that the state would receive positive net revenue from the incentives legislation, despite the cost.
But Pruett said the most important statistic is the jobs that would be saved.
“We’ve lost about 10,000 furniture manufacturing jobs since 2000, and about 6,000 have been cut-and-sew jobs,” Pruett said. “If we continue to lose those support jobs, that will lead to the loss of many other furniture manufacturing jobs, too.”
Pruett said that MFA members were getting together to determine their next step. The Legislature will reconvene next month, and Pruett said he hoped they could convince them to override Barbour’s veto.
“If we’re not successful, we’ll try again in January, but that just means we’ve wasted another year and we’ll lose jobs we could have saved,” he said.
McCoy said that if the bill had been a House proposal, he would try to override the veto. But it is a Senate bill so it will have to be overridden there first.
Sen. Alan Nunnelee, R-Tupelo, the primary author of the bill, thinks it’s unlikely the Senate will override even though on final passage no member of the House or Senate voted against the proposal.
Barbour said that “there are better ways to help Mississippi’s important furniture industry, and its cut-and-sew operations.”
He cited the Foreign Trade Zone manufacturing authority granted to Lane, H.M. Richards and Bauhaus USA that enable the companies to import a particular fabric duty-free.
The companies said in December that they were able to save some 950 jobs and will save more than $1 million each year.
“The state will gladly pursue such approval for other Mississippi companies to save jobs,” Barbour said.
Contact Dennis Seid at (662) 678-1578 or firstname.lastname@example.org. Bobby Harrison of the Capitol Bureau contributed to the story.
Dennis Seid/Daily Journal