[1/26/05] A bill that could help redevelop the idle Vicksburg Chemical plant moved a step closer to passage in the House of Representatives Tuesday as city officials took steps to encourage the rehabilitation of older commercial properties.

The Vicksburg Board of Mayor and Aldermen voted to approve creating a new citywide tax abatement district.

Separately, the House Ways and Means Committee sent a bill to create an Redevelopment Project Incentive Fund from taxes collected on contaminated property to the full House for consideration.

The new ordinance will go into effect in 30 days and will allow developers to avoid some property taxes when they invest in existing structures.

A twin program is already in place to encourage redevelopment in the downtown area.

Those who meet requirements will be able to apply for exemptions from city taxes on the value of the improvements made to existing buildings. Owners would still pay the taxes on the assessed value of any building before improvements as well as county and school taxes.

City Attorney Nancy Thomas said the new program will also include redevelopment of properties where older properties are demolished and replaced, but will not apply to new construction. The value of the improvements will have to be at least $100,000 and will have to improve the aesthetic of the property, Thomas said.

While the new city rules could exempt certain projects from city property taxes on improvements, the Redevelopment Project Incentive Fund proposed by Rep. George Flaggs, D-Vicksburg, would use state taxes to clean up contaminated properties.

The bill and a companion bill filed in the Senate by Mike Chaney, R-Vicksburg, are aimed at the former Vicksburg Chemical Property off Rifle Range Road. It has been estimated that the clean-up of the 40-acre contaminated site could cost up to $8 million.

Harcros Chemicals Inc. of Kansas City, Kan., in partnership with Arcadis, a Dutch multinational corporation with U.S. headquarters near Denver, has been in negotiations with the Mississippi Department of Environmental Quality to take over the site and reopen the chemical plant, but those talks have stalled over the cost of cleaning up the site.

Vicksburg Chemical shut down in 2002 after its parent company, Cedar Chemical, filed for bankruptcy. In the process of the bankruptcy, a judge in the U.S. Bankruptcy Court for the Southern District of New York allowed the company to abandon the site to the ownership of the MDEQ.

At various times, the plant made fertilizer, rocket fuel components and other chemicals. Much of the byproduct was disposed of on the site, as was then required by state and federal regulations.

Cleaning up of the site could open 540 acres for potential development including a proposed municipal golf course and reopening of the chemical plant.

City and county officials have been working for the past year to sweeten the deal for redevelopment of the property. Last year, a federal bankruptcy judge has ordered a tax lien in Warren County void at the request of supervisors who said they would not seek nearly $800,000 in back taxes if the property was redeveloped.