Mississippi GO Zone Private
Activity Bonds
The Gulf Zone Opportunity Zone Act will provide private businesses and corporations
in Mississippi with the opportunity to finance construction and reconstruction
of projects through the issuance of tax-exempt bonds.
The Act provides for approximately $4.8 billion in additional authority
for Mississippi and its political subdivisions to issue private activity
bonds.
Private business owners and corporations may borrow tax-exempt money
to cover the costs of acquiring, constructing and renovating nonresidential
real property located in the GO Zone.
Issuance of any bonds authorized under this provision must also be approved
by Governor Barbour.
Mississippi Counties in the GO Zone
Adams, Amite, Attala, Claiborne, Choctaw, Clarke,
Copiah, Covington, Forrest, Franklin, George, Greene, Hancock, Harrison,
Hinds, Holmes, Humphreys, Jackson, Jasper, Jefferson, Jefferson Davis,
Jones, Kemper, Lamar, Lauderdale, Lawrence, Leake, Lincoln, Lowndes,
Madison, Marion, Neshoba, Newton, Noxubee, Oktibbeha, Pearl River,
Perry, Pike, Rankin, Scott, Simpson, Smith, Stone, Walthall, Warren,
Wayne, Wilkinson, Winston and Yazoo (Counties shown in orange on this map)
Projects That Qualify for Tax-exempt Financing
Eligible projects may include, but are not limited to: retail
stores, warehouses, manufacturing facilities, industrial plants, office
buildings, bank branches, hotels and motels, restaurants, physician office
buildings, medical hospitals and clinics.
The Benefits of GO Zone Bond Project Financing
Interest on bonds is exempt from federal and State of Mississippi income
taxes; therefore the interest rate is lower than through conventional
financing, historically saving a borrower 1.50% to 2.00%. Congress has
also excluded the interest on the GOZB from Alternative Minimum Taxation.
Special Depreciation Election Benefit
The Act permits businesses to claim an additional first year depreciation
deduction equal to 50 % of the cost of new capital investments made in
the Zone (depreciation will be taken in lieu of tax-exempt financing).
The depreciation deduction is exempt from AMT, does not require approval
by the State, and applies to property placed in service prior to January
1, 2008, or January 1, 2009 for real property. We recommend consultation
with your certified public accountant regarding qualification and treatment
of this benefit. Morgan Keegan and Regions welcome the opportunity to
assist in evaluating and executing taxable or conventional financing
alternatives for those who select the depreciation deduction.
Advance Refunding Benefit for Municipal Debt
The Act provides for an approximate $2.25 billion of funds to permit an additional
advance refunding opportunity for municipal debt. Through this, the State,
counties, municipalities, etc. may apply to the Governor’s office for
an allocation of the proceeds. This opportunity is NOT restricted solely
to the Zone; it applies to ALL Mississippi counties.
Securities offered through Morgan Keegan are not
FDIC insured, not bank guaranteed, and may lose value. |
