HATTIESBURG, MS (WDAM) - The Hattiesburg City Council voted to appeal a Forrest County Circuit Court ruling by special-appointed Judge Larry Roberts regarding a lawsuit filed by small engine manufacturer Kohler against Forrest County and the city of Hattiesburg.
That court ruling declared that Kohler is entitled to receive tax exemptions on raw materials and work in process for the full 20-year binding period through and including the 2017 tax year.
"The county and city have a good bit at stake here and not just for this case but for the future as well," said city attorney Randy Pope. "Of course this is money that if the city and the county are not successful on appeal that they will have to refund to Kohler. So it's a serious issue."
According to Forrest County Board Attorney David Miller, the county's amount to be paid is just above $900,000. The city's amount has not been calculated but Miller believes the number will be just over half of what the county owes.
The lawsuit was first filed in 2014 for declaratory relief, alleging that the county and city had breached the Inducement Agreement by refusing to grant Kohler's requested tax exemptions on raw materials and work in progress for tax years 2010 and later.
"There was an agreement when Kohler built their plant here back in 1998," Pope said. "The city and county entered into an agreement with them to provide tax exemptions to the extent that we could legally, and the controversy arose after the first 10 or 11 years of that concerning the 'personal property' and 'work in progress.' We took the position that it is not available for exemption and they took the position that it was."
The court ruled in favor of Kohler this week.
The appeal is headed to the Mississippi Supreme Court who will then decide to hear the case or send it back down to the Mississippi Court of Appeals.