MISSISSIPPI LEGISLATURE

2015 Regular Session

To: Corrections

By: Senator(s) Tindell

Senate Bill 2562

(As Passed the Senate)

AN ACT TO TRANSFER THE DUTY TO ASSIST THE MISSISSIPPI DEPARTMENT OF CORRECTIONS IN THE MANAGEMENT OF PRISON LANDS LEASED FOR AGRICULTURAL PURPOSES FROM THE DEPARTMENT OF FINANCE AND ADMINISTRATION TO THE COMMISSIONER OF AGRICULTURE AND COMMERCE; TO PRESCRIBE THE PROCEDURES TO BE USED FOR LEASING AND RE-LEASING PRISON LANDS THROUGH THE COMPETITIVE BID PROCESS; TO AMEND SECTION 47-5-64, MISSISSIPPI CODE OF 1972, TO DECREASE THE MAXIMUM TERM FOR AGRICULTURAL LEASES; TO AMEND SECTION 47-5-66, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT THE MISSISSIPPI STATE AGRICULTURAL REGISTRATION AND THE MISSISSIPPI MARKET BULLETIN SHALL BE PUBLICATIONS FOR THE ADVERTISEMENT OF SUCH LEASES; TO REVISE THE ADVERTISEMENT CRITERIA FOR THE LEASING OF PRISON LANDS; TO REMOVE CERTAIN PROCEDURES WHICH ALLOWED PAYMENT BY A LESSEE BY PROMISSORY NOTE; TO REMOVE THE REQUIREMENT THAT A CERTAIN PERCENTAGE OF FUNDS DERIVED FROM LEASING PENITENTIARY LANDS SHALL BE DISTRIBUTED TO CERTAIN SCHOOLS; TO AMEND SECTIONS 47-5-351 AND 47-5-355, MISSISSIPPI CODE OF 1972, IN CONFORMITY TO THE PRECEDING PROVISIONS; TO BRING FORWARD SECTIONS 47-5-353 AND 47-5-357, MISSISSIPPI CODE OF 1972, FOR PURPOSES OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.

     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

     SECTION 1.  (1)  Prison lands may be leased for agricultural purposes for use as prison agricultural enterprises, as provided under Sections 47-5-351 through 47-5-357, for a term not exceeding four (4) years.  All leases of prison lands must be for a term to expire on December 31.  Except in those cases when the holder of an existing agricultural lease on prison lands elects to re-lease the land, as authorized under this subsection, the Commissioner of Agriculture and Commerce shall lease the prison lands at public contract after the Department of Corrections has advertised the lands for rent in a newspaper published in the county in which the prison lands are situated or, if no newspaper is published in that county, then in a newspaper having a general circulation in the county, in the Mississippi State Agricultural Registration and the Mississippi Market Bulletin for two (2) successive weeks, the first being at least ten (10) days before the public contract.  The lease form and the terms so prescribed must be on file and available for inspection in the Office of the Commissioner of Corrections and the Commissioner of Agriculture and Commerce from and after the public notice by advertisement and until finally accepted by the Commissioner of Agriculture and Commerce.  However, before the expiration of an existing agricultural lease of prison lands, the Commissioner of Agriculture and Commerce, in his discretion, may authorize the holder of the existing lease to re-lease the land, on no more than one (1) occasion, for a term not to exceed four (4) years and for a rental amount that is no less than one hundred twenty percent (120%) of the total rental value of the existing lease.  If the holder of the existing lease elects not to re-lease the land, the department shall publish an advertisement of agricultural land for rent, which publication may not be more than four (4) months before the expiration of the term of an existing lease of the land.  An election by the holder of the existing lease not to re-lease the land does not preclude his participation in the bidding process established under this section.  The Commissioner of Agriculture and Commerce, acting on behalf of the department, shall enter into a new agricultural lease on prison lands before the expiration of an existing lease on the same land, and the new lease shall take effect on the day immediately following the day on which the existing lease expires.  The Commissioner of Agriculture and Commerce may require bidders to furnish bond or submit evidence of financial ability.

     Bids received by the Commissioner of Agriculture and Commerce in response to the advertisement must be opened at a special meeting of the Commissioner of Agriculture and Commerce.  The Commissioner of Agriculture and Commerce, at her option, may reject all bids or accept the highest and best bid received in response to the advertisement or alternatively, may hold an auction among those who submitted bids in response to the advertisement.  If the Commissioner of Agriculture and Commerce elects to hold an auction, no bidder may be granted any preference.  The opening bid at the auction must be the highest bid received in response to the advertisement.

     (2)  (a)  If the Commissioner of Agriculture and Commerce receives an acceptable bid in response to the advertisement and elects not to hold an auction among those submitting bids, then the holder of the existing lease may submit a second bid in an amount not less than one hundred five percent (105%) of the highest acceptable bid received if the holder of the existing lease:  (i) submitted a bid in response to the advertisement; and (ii) constructed or made improvements on the leasehold premises after receiving approval of the Commissioner of Agriculture and Commerce during the term of the existing lease.  For purposes of this subsection, the term "improvements" does not include any work or items that are done customarily on an annual basis in the preparing, planting, growing, cultivating or harvesting of crops or other farm products.

          (b)  If the holder of the existing lease elects to submit a second bid, the Commissioner of Agriculture and Commerce shall hold an auction among those who submitted bids in response to the advertisement.  The opening bid at the auction must be the second bid of the holder of the existing lease.  However, no leaseholder may submit a second bid if:  (i) any rent, taxes or other payment required under his lease are past due; or (ii) he is otherwise in default of any term or provision of the lease and such default has not been corrected or cured to the satisfaction of the Commissioner of Agriculture and Commerce after more than thirty (30) days' notice to the leaseholder of the default.

          (c)  If an auction is held, the auction may be conducted at a special meeting of the Commissioner of Agriculture and Commerce at which bids are opened or at a later special meeting called by the Commissioner of Agriculture and Commerce for the purpose of holding an auction.  The Commissioner of Agriculture and Commerce shall announce the time and place of the auction at the meeting at which bids are opened, and no further notice of the auction is required.

          (d)  If no bid acceptable to the Commissioner of Agriculture and Commerce is received after the advertisement or at auction, the Commissioner of Agriculture and Commerce may lease, within ninety (90) days, the lands by private contract for an amount greater than the highest bid previously rejected in order to acquire a fair rental value for the lands.  If no bids are received in response to the advertisement, the Commissioner of Agriculture and Commerce may negotiate a private contract for a fair rental value.  The term of the contract must expire on December 31 of the same calendar year in which the contract is made.  The Commissioner of Agriculture and Commerce may take the notes for the rent and attend to their collection.  The Commissioner of Agriculture and Commerce has the right and remedies for the security and collection of those rents given by law to the director of prison agricultural enterprises.

          (e)  If an existing lease is terminated before the expiration of the term originally set in that lease, upon finding that immediate action is necessary to prevent damage or loss to growing crops or to prevent loss of opportunity to lease the land for the current growing season, the Commissioner of Agriculture and Commerce may negotiate a private contract for a fair rental value.  The term of the lease must expire on December 31 of the same calendar year in which the contract is made.

     (3)  Any holder of an agricultural lease on prison lands which was granted before July 1, 2015, and which has an expiration date on or after April 1 but before December 31 during the final year of the lease term may extend the term of the lease to December 31 next following the expiration date originally provided for in the lease.  If the lease is extended, the rent for the period from the original expiration date in the lease to December 31 next following the original expiration date must be one hundred five percent (105%) of the annual rent provided in the existing lease prorated over the period of the lease extension.  At the expiration of the extended lease term or at the expiration of the original lease term if the lease holder does not extend the lease, the land must be offered for lease as provided in subsection (1) of this section.

     SECTION 2.  Section 47-5-64, Mississippi Code of 1972, is amended as follows:

     47-5-64.  (1)  The commissioner is hereby directed to determine the number of acres and location of land under the department's jurisdiction that are needed for security purposes, for Prison Agricultural Enterprises and for nonagricultural purposes.  The commissioner shall designate and reserve such additional land for agricultural or nonagricultural enterprise projects of the department, as he deems necessary.  On or before July 1 of each year, the commissioner shall * * * then recommend to the * * * Department of Finance and Administration Commissioner of Agriculture and Commerce the * * * number of acres of specific department lands * * * that shouldto be leased to private entities * * *and the term of the leases.

     (2)  The * * * Department of Finance and AdministrationCommissioner of Agriculture and Commerce is authorized to lease for agricultural purposes that Penitentiary land so recommended for not less than * * * three (3)one (1) year nor more than * * * eight (8)four (4) years, * * * with the approval of the Public Procurement Review Board in the same manner and for the same term as provided in Section 1 of this act.

     (3)  The * * * Department of Finance and AdministrationCommissioner of Agriculture and Commerce, with the approval of the Governor, * * * the Commissioner of Agriculture and Commerceand the Commissioner of the Department of Corrections, is authorized to lease Penitentiary land for power generation projects or other commercial or industrial projects at the same time that * * * it the Commissioner of Agriculture and Commerce leases the land as prescribed in subsection (2) of this section.  The * * * Department of Finance and Administration Commissioner of Agriculture and Commerce is authorized to negotiate all aspects of leases or related agreements executed under this subsection consistent with the following:

          (a)  The period of the lease term combined with the term of renewal shall not exceed forty (40) years.

          (b)  Any lease or renewal lease shall:

              (i)  Provide for periodic rent adjustments throughout the term of the lease; and

              (ii)  Require the lessee to provide a decommissioning and restoration bond or other security securing the lessee's obligation to remove all aboveground and underground facilities to a depth of at least three (3) feet underground and to restore the surface to a condition similar to its condition before the commencement of the lease.

          (c)  Any lease or renewal lease may provide for any combination of the following:  base rent, bonuses, percentage of income payments, royalty payments or other terms and conditions that the * * * Department of Finance and Administration Commissioner of Agriculture and Commerce deems necessary to maintain a fair and equitable return to the state and to protect the leased land throughout the term of the lease or renewal lease.

          (d)  Oil, gas and mineral rights in the leased land shall be reserved to the State of Mississippi.

          (e)  This subsection does not authorize the sale or transfer of title to any state lands.

          (f)  The * * * Department of Finance and AdministrationCommissioner of Agriculture and Commerce may charge fees and expenses, not to exceed costs, incurred in administering this subsection.

          (g)  Any monies derived from leasing lands under this subsection shall be deposited to the Prison Agricultural Enterprise Fund as provided in Section 47-5-66.

     SECTION 3.  Section 47-5-66, Mississippi Code of 1972, is amended as follows:

     47-5-66.  (1)  Except as provided in Section 47-5-64(3), it shall be the duty of the * * * Department of Finance and Administration, with the approval of the Public Procurement Review BoardCommissioner of Agriculture and Commerce, to lease lands * * * at public contract upon the submission of two (2) or more sealed bids to the Department of Finance and Administration after having advertised the land for rent in the same form and manner prescribed in Section 1 of this act.  Advertisement for bids must be run in newspapers of general circulation published in Jackson, Mississippi; Memphis, Tennessee; the county in which the land is located; the Mississippi State Agricultural Registration; and the Mississippi Market Bulletin and contiguous counties for a period of not less than two (2) successive weeks. * * * The first publication shall be made not less than ten (10) days before the date of the public contract, and the last publication shall be made not more than seven (7) days before that date.  The Department of Finance and Administration may reject any and all bids.  If all bids on a tract or parcel of land are rejected, the Department of Finance and Administration may then advertise for new bids on that tract or parcel of land.  Successful bidders shall take possession of their leaseholds at the time authorized by the Department of Finance and Administration.  However, rent shall be due no later than the day upon which the lessee shall assume possession of the leasehold, and shall be due on the anniversary date for each following year of the lease.  The Department of Finance and Administration may provide in any lease that rent shall be paid in full in advance or paid in installments, as may be necessary or appropriate. In addition, the * * * Department of Finance and Administration Commissioner of Agriculture and Commerce may accept, and the lease may provide for, assignments of federal, state or other agricultural support payments, growing crops or the proceeds from the sale thereof, promissory notes, or any other good and valuable consideration offered by any lessee to meet the rent requirements of the lease. * * *If a promissory note is offered by a lessee, it shall be secured by a first lien on the crop of the lessee, or the proceeds from the sale thereof.  The lien shall be filed pursuant to Article 9 of the Uniform Commercial Code and Section 1324 of the Food Security Act of 1985, as enacted or amended.  If the note is not paid at maturity, it shall bear interest at the rate provided for judgments and decrees in Section 75‑17‑7 from its maturity date until the note is paid.  The note shall provide for the payment of all costs of collection and reasonable attorney's fees if default is made in the payment of the note.  The payment of rent by promissory note or any means other than cash in advance shall be subject to the approval of the Public Procurement Review Board, which shall place the approval of record in the minutes of the board.

     (2)  There is created a special fund to be designated as the "Prison Agricultural Enterprises Fund" and to be used for the purpose of conducting, operating and managing the agricultural and nonagricultural enterprises of the department.  Any monies derived from the leasing of Penitentiary lands, from the sales of timber as provided in Section 47-5-56, from the prison's agricultural enterprises or earmarked for the Prison Industries Fund shall be deposited to the special fund.  However, fifteen percent (15%) of the monies derived from the leasing of Penitentiary lands under Section 47-5-64(3) shall be deposited to a special fund to be distributed annually on a student pro rata basis to the public schools located in Sunflower County by the * * * Department of Finance and Administration Commissioner of Agriculture and Commerce.

     (3)  All profits derived from prison industries shall be placed in a special fund in the State Treasury to be known as the "Prison Industries Fund," to be appropriated each year by the Legislature to the nonprofit corporation, which is required to be organized under the provisions of Section 47-5-535, for the purpose of operating and managing the prison industries. 

     (4)  The state shall have the rights and remedies for the security and collection of the rents given by law to landlords. 

     (5)  Lands leased for agricultural purposes under Section 47-5-64(2) shall be subject to a fee-in-lieu of ad valorem taxes, including taxes levied for school purposes.  The fee-in-lieu shall be Nine Dollars ($9.00) per acre.  Upon the execution of the agricultural leases to private entities as authorized by Section 47-5-64(2), the * * * Department of Finance and Administration Commissioner of Agriculture and Commerce shall collect the in lieu fee and shall forward the fees to the tax collector in which the land is located.  The tax collector shall disburse the fees to the appropriate county or municipal governing authority on a pro rata basis.  The sum apportioned to a school district shall not be less than the school district's pro rata share based upon the proportion that the millage imposed for the school district by the appropriate levying authority bears to the millage imposed by the levying authority for all other county or municipal purposes.  Any funds obtained by the corporation as a result of sale of goods and services manufactured and provided by it shall be accounted for separate and apart from any funds received by the corporation through appropriation from the State Legislature.  All nonappropriated funds generated by the corporation shall not be subject to appropriation by the State Legislature.

     (6)  Any land leased, as provided under Section 47-5-64(2), shall not be leased for an amount less than would be received if such land were to be leased under any federal loan program. * * *In addition, all leases shall be subject to the final approval of the Public Procurement Review Board before such leases are to become effective.

     SECTION 4.  Section 47-5-351, Mississippi Code of 1972, is amended as follows:

     47-5-351.  (1)  It is the policy of the State of Mississippi that the Department of Corrections, to the extent practical, make maximum utilization of the farm lands of the various correctional institutions for the purpose of feeding inmates.

     (2)  It is the intent of the Legislature that the department grow, harvest and process those agricultural products that will directly assist in reducing the reliance of the department upon external sources of supply and that will facilitate the self-sufficiency of the inmates and the department.

     (3)  The Department of Corrections shall establish, implement and, in consultation with the Commissioner of Agriculture and Commerce, acting in an advisory capacity, manage prison agricultural enterprises in a manner and form deemed appropriate to ensure compliance in the agricultural leasing of prison lands to private entities as prescribed in Sections 47-5-64 and 47-5-66, and a profitable farming operation and self-sufficiency in the feeding of the inmates.

     (4)  The Legislature finds that the mission of the prison agricultural enterprises is:

          (a)  To reduce the cost of state government by producing and processing food for use by inmates;

          (b)  To operate the program primarily with inmate labor;

          (c)  To serve the security goals of the department through the reduction of idleness of inmates;

          (d)  To produce and market agricultural products that will aid in maintaining a profitable agricultural operation to the maximum extent possible.

     SECTION 5.  Section 47-5-353, Mississippi Code of 1972, is brought forward as follows:

     47-5-353.  For the purpose of Sections 47-5-351 through 47-5-357, the following terms shall have the following meanings unless the context shall provide otherwise:

          (a)  "Agricultural commodities" means crops, vegetables, fruits, livestock, domesticated fish, fowl, seafood, animal husbandry, wood and the various processes that any of these commodities may go through subsequent to their removal from the soil or water.

          (b)  "Commissioner" means the Commissioner of Corrections;

          (c)  "Department" means the Department of Corrections;

          (d)  "Director" means the director of the prison agricultural enterprises;

          (e)  "Prison agricultural enterprises" means any program operated by the Department of Corrections including, but not limited to, the growing, harvesting, processing and marketing of crops, vegetables, fruits, livestock, domesticated fish, fowl and any product of agriculture, animal husbandry or aquaculture that may be used for the feeding of prisoners for the general welfare of the prisoners or profitably grown on department lands.  This term includes any proper method of canning, freezing or preserving such products; and

          (f)  "Products" means any item produced by prison agricultural enterprises.

     SECTION 6.  Section 47-5-355, Mississippi Code of 1972, is amended as follows:

     47-5-355.  (1)  The Commissioner of Corrections shall employ a director of the prison agricultural enterprises, who shall be directly responsible to the commissioner.  The director shall have the following duties and powers:

          (a)  To implement and manage the prison agricultural enterprises;

          (b)  To determine, with the advice of the Director of Planning, the type of agricultural, animal husbandry and aquaculture products needed to feed inmates and which may be grown profitably on department lands;

          (c)  To use inmate labor to meet the labor needs of the programs, subject to the requirements of subsection (2);

          (d)  To recommend rules and regulations and employ personnel necessary for the operation of the programs;

          (e)  To determine the proper methods of canning, freezing or preserving that may be used to the best advantage of the programs;

          (f)  With approval of the commissioner, to do those things necessary and proper to accomplish the purposes of the programs;

          (g)  To determine and establish priorities on the most appropriate and profitable products to be grown and which department lands should be farmed, taking into consideration the available prison labor, existing equipment and funds available therefor, markets for the products, and other matters consistent with prudent agricultural practices;

          (h)  To manage the food services of the department at the discretion of the commissioner * * *.; and

          (i)  To take inventory of all prison lands, with an accounting of their total acreage and location, for a determination of which lands are available and shall be designated in the agricultural enterprises of each correctional facility under the jurisdiction of the Mississippi Department of Corrections and which lands shall be made available and designated for lease to private entities, which shall be reported to the Commissioner of Agriculture and Commerce.

     (2)  The director shall have the right to use inmate labor to the exclusion of prison industries.  The superintendents shall provide the prison agricultural enterprises with sufficient inmate labor.  If a superintendent refuses to provide inmate labor because of security concerns, the commissioner shall decide if security requirements preclude use of inmate labor.  Upon the request of the director, the superintendents shall provide security for prison agricultural enterprises.

     (3)  The director shall maintain accurate and complete financial records of all receipts and expenditures of the prison agricultural enterprise programs.

     (4)  The director shall file a full and complete report with the Legislature and the Commissioner of Agriculture and Commerce before January 1 of each year detailing the costs, inventory and receipts of each program.  The report shall also provide the cost or cost savings of such programs.

     (5)  The department may enter into joint ventures with private businesses related to prison agricultural enterprises, provided that all agreements and leases of prison lands for such joint ventures are verified and approved by the Commissioner of Agriculture and Commerce.

     SECTION 7.  Section 47-5-357, Mississippi Code of 1972, is brought forward as follows:

     47-5-357.  (1)  Due to the unique and time sensitive requirements of growing and harvesting products produced by the prison agricultural enterprises, the Department of Finance and Administration and the department shall establish a prudent purchasing policy which may exempt from bid requirements those commodities, items or services which are needed for the efficient and effective management of the prison agricultural enterprises.

     (2)  The Department of Finance and Administration shall, by order entered on its minutes, list those commodities, items and services exempted from bid requirements as provided in Section 31-7-12, Mississippi Code of 1972.

     SECTION 8.  Section 1 of this act shall be codified in Chapter 5, Title 47, Mississippi Code of 1972.

     SECTION 9.  This act shall take effect and be in force from and after July 1, 2015.