(Photo from the City of Oxford on Facebook)
- The language creating the “Local Governments Disaster Recovery Emergency Loan Program Act” was placed into another bill and unanimously approved by both chambers on Thursday.
Both the Mississippi House and Senate unanimously voted Thursday to revive the “Local Governments Disaster Recovery Emergency Loan Program Act” that was vetoed earlier this week by Governor Tate Reeves (R). The program is intended to assist local government in recovering from Winter Storm Fern.
Reeves claimed the prior bill containing the loan program, SB 2632, included material changes to the legislation that were made after it had already been presented to his office. He said in his veto message that such action would violate the state Constitution and may rise to criminal conduct.
Lt. Governor Delbert Hosemann (R) and the lawmakers responsible for the bill rebutted the governor’s claim, saying Reeves had his facts wrong on the timing of the changes.
READ MORE: Hosemann says Reeves veto message of disaster loan program is inaccurate
Conferees in both chambers who were selected to work out the details on HB 1646 regarding the state’s disaster trust fund decided to include the loan program language in their conference report before bringing the measure back before the House and Senate.
The new agreed upon loan program sets the interest rate at 3% annually, up from the 1% that was in the prior legislation. In the earlier measure, lawmakers removed the word “monthly” in relation to the interest rate as it would have resulted in a total of 12% annually. The timing of that change was what Reeves had called into question.
“The House and Senate have come together to propose a 3 percent interest rate, which is much less than the 12 percent the governor wanted,” said State Senator Scott DeLano (R), referring to the contention over the rate and the wording in the previous bill.
The interest rate is zero while the local governments are waiting for FEMA to reimburse them for the money they have already spent.
“The only time we trigger an interest rate at all, this 3 percent, is when all the reimbursements are made to a local jurisdiction and there may be, and a loan amount is outstanding,” he said.
A statement from Lt. Governor Hosemann prior to the Senate’s action read, “Our neighbors in North Mississippi have suffered too much devastation, and we must provide financial relief as quickly as possible. This conference report is a second attempt to support our cities and counties. We will pass it out of the Senate.”
The program will be administered by the Mississippi Emergency Management Agency, with loans available to local governments through June 2027.
As for the other provisions in HB 1646 related to the state’s disaster trust fund, the bill increased the amount of funds MEMA receives from its working cash stabilization funds. The new amount is $2.5 million, up from $1 million for a storm event. The bill also increases the cap from $2 million to $5 million.
The disaster trust fund is what the state uses for emergency responses across Mississippi. It also pays the state match for any FEMA projects resulting from the event.
HB 1646 with the disaster loan program included now heads to the governor’s desk.
