Mantachie officials concerned about $50K investment

By Adam Armour/The Itawamba County Times

Mantachie’s $50,000 investment in a reeling business may not pay off in the dividends town leaders were anticipating.

During their regular meeting last week, Mantachie aldermen discussed the recent exodus of Townhouse Furniture, which relocated its Smithville operations to Mantachie last year when a tornado devastated the town, back to its hometown. The business, which at its peak, employed 150 workers, was located in the former PeopLounger’s building.

According to Mantachie Mayor Jeff Butler, the company ceased its Mantachie operations approximately two weeks ago. Company representatives, he said, claim the closure is “temporary” and the company plans to reopen its Mantachie plant within eight weeks.

Butler said company officials claimed work at the plant had slowed to a crawl. Many of its employees live in Smithville, he said, and the plant was losing workers to the long commute.

Now, the plant stands empty and in poor shape, according to town leaders. Overgrown and trash-littered, the grounds are in desperate need of some maintenance.

The board voted to send the company a letter requesting the grounds be cleaned within the next 30 days.

More troubling, however, is that the opening of the Townhouse Furniture plant required significant investments on both the part of the town and county. Following the April 2011 tornado that destroyed its Smithville business, Mantachie pledged $50,000 to help Townhouse Furniture rebound. This money was pulled from the town’s general fund savings account.

Numerous local businesses and individuals also helped restore the PeopLounger’s Building, which had been empty for years prior, to operable conditions.

The investment was supposed to be just that — an investment. The county, which owns the building, spent $35,000 to help renovate the building. That money is being recouped via a rental payment of $10,000 per month, which is still being paid.

But the town of Mantachie receives no such regular payment. Although the company was purchasing its utilities through the town, with operations halted, that well has dried up. If the plant were operational, the workers would be spending money in the town’s stores — eating lunch at its restaurants and filling cars with its gas — generating the sales tax revenue on which the town operates. No workers equal no sales tax.

Needless to say, town officials are worried their hefty investment isn’t going to pay off.

“We were counting on that sales tax revenue from their employees,” Butler said. “That was a heck of an investment for the town of Mantachie. To a town our size, that was a huge chunk of money.”

For now, the board has little choice but to wait and see what happens. If the company returns as promised, all is good; if not, then alderman Wayne Guin suggested the town consider seeking some legal recourse.

“[That investment] was a big risk for the town,” he said, adding that Townhouse should keep up their end of the bargain.

Prior to locating to Mantachie, Townhouse guaranteed to keep a minimum of 125 jobs. Additionally, the company agreed not to request a tax deduction for the next 10 years. After this time had passed, the county would agree to sell the building to the company at a discounted rate.

Townhouse is worth about $1.6 million on the Itawamba County tax roll.

When the company first relocated to Mantachie, representatives claimed they would reopen a Smithville division within the near future, but also keep both the Amory and Mantachie locations operational.

adam.armour@journalinc.com