Montgomery County commissioners spent the December 16 information session debating whether to formalize an agreement that would reserve 10% of a county 1¢ sales tax for economic-development projects intended to grow the tax base while maintaining 90% for education.

Clint Graves, who said he drafted the agreement, told the commission the 10% allocation is meant "to be limited to economic development projects where a finding is made by the county commission where those projects would increase the tax base," and that the language is intended to preserve the tax's status as an education tax. Graves cited the statute's history dating to Act No. 89 (1975) and subsequent code changes.

Unidentified Speaker (S2) challenged the proposal as "taking money from public education to spend on economic development," calling the clause "ambiguous" and asking whether the county could instead designate 90% for education and 10% for other purposes. Graves responded that while the commission retains broad authority over a general tax, the agreement was drafted to provide certainty that education receives 90% and that the 10% would be used for limited economic-development projects that would not be abated in ways that reduce education revenue.

Several commissioners framed the proposal in the context of Jackson Hospital, saying the county must act to prevent the hospital and its roughly 2,200 jobs from collapsing. Unidentified Speaker (S4) argued the 10% could be used to incentivize or secure businesses such as the hospital to preserve the future tax base that funds schools. Unidentified Speaker (S2) and others warned the county has fiscal constraints and pointed to an earlier $10,000,000 county pledge to Jackson Hospital as evidence of existing commitments.

No formal vote on the allocation agreement was recorded during the information session. Commissioners asked legal and procedural questions about abatements, prior designation changes of the 1¢ tax, and whether future abatement agreements could capture some of the 10% under current deals. The discussion closed with commissioners agreeing more clarification and possible formal action would occur at a subsequent meeting.

Why it matters: The county's choice affects funding available for public education and county economic-development incentives and could determine whether public dollars are available to shore up a major regional employer and health-care provider.

What happens next: The item was discussed at the information session for clarity; commissioners indicated it would return for formal consideration and potential action at the regular agenda.