Can a Mississippi city give a certified farmers' market free use of a city-owned parking lot, instead of charging rent?

Plain-English summary

Winona owned a vacant parking lot. A certified farmers' market wanted to use it. The City asked: can we just donate the use, or do we have to charge rent?

Mississippi's general rule is that municipalities cannot donate public assets to private parties (Miss. Const. § 66; McAdams v. Perkins, 204 So. 3d 1257 (Miss. 2016)). But the Legislature has carved out specific exceptions, and § 21-19-69 is one. It authorizes the governing authorities of any municipality to donate annually from the municipal treasury "such sums as deemed advisable to support any farmers' market that is certified by the Mississippi Department of Agriculture and Commerce and operating within the municipality, not to exceed the amount that would be generated from the levy of a one-fourth (¼) mill ad valorem tax upon all taxable property in the municipality."

The statute talks about cash donations (sums from the treasury). The City wanted to donate use of property instead. The AG confirmed that AG opinions consistently treat in-kind donations as implicitly authorized whenever cash donations are statutorily allowed. (See Manley, May 1, 2015; Baum, Feb. 17, 2006; Hewes, Jan. 28, 2005.)

So the analysis:
1. The farmers' market must be certified by the Mississippi Department of Agriculture and Commerce.
2. The market must be operating within the City.
3. The value of the donated use must not exceed the one-fourth mill cap.
4. The City must make these factual determinations on the record.

If those boxes are checked, the City can donate the use of the parking lot to the farmers' market. The AG also referred Winona to the State Auditor for fiscal review, since the question involves expenditure of public funds.

What this means for you

If you are a Mississippi mayor or city attorney

§ 21-19-69 gives you a specific authority to support certified farmers' markets, including through in-kind donations like free use of municipal property. Calculate the one-fourth mill cap for your city annually, document the market's certification status, and make the donation findings on the record.

If you operate a certified farmers' market in Mississippi

You may be eligible for in-kind support from your municipality (free or low-cost use of city facilities). Approach the city with documentation of your certification by the Mississippi Department of Agriculture and Commerce. The municipality's authority to support is discretionary, so the city decides whether to act.

If you are uncertified and looking to start a farmers' market

Get certified first. The statutory authority for municipal support runs only to certified markets. Mississippi Department of Agriculture and Commerce administers the certification.

If you are a city auditor or State Auditor staff

Confirm that the donating municipality has documented (1) the market's certification, (2) the in-kind value, and (3) compliance with the one-fourth mill cap. The cap calculation depends on current taxable property valuations, so it changes year to year.

Common questions

Q: How much is one-fourth mill?
A: One mill = one dollar of tax per $1,000 of assessed value. So one-fourth mill = $0.25 per $1,000. For a Mississippi city with $100 million in taxable property, the cap would be $25,000 per year.

Q: Does the cap include in-kind donations?
A: Yes. The statute caps the total annual support, and AG opinions treat cash and in-kind donations as both counting toward that total.

Q: How is the value of "use of a parking lot" measured?
A: Reasonable rental value or market rate for similar space. The City can use comparable rents in the area, parking-lot square footage rates, or other reasonable measures. Document the methodology.

Q: What if a farmers' market wants to use the lot multiple days a week year-round?
A: As long as the total annual value of the use stays under the one-fourth mill cap, that's allowed. If it exceeds the cap, the city would need to charge for the portion above the cap.

Q: Can the city donate to multiple farmers' markets?
A: Yes, but the cap appears to apply per market (the statute uses "any farmers' market"). Aggregate donations to multiple markets each get the per-market cap, though city counsel should verify with current AG guidance.

Q: Does the market have to be a nonprofit?
A: § 21-19-69 doesn't specify nonprofit status. The certification is the gating requirement. Some farmers' markets are organized as nonprofits, others as cooperatives or for-profit ventures; certification is what matters here.

Q: What's the certification process?
A: Administered by the Mississippi Department of Agriculture and Commerce. Generally requires Mississippi-grown produce focus, vendor compliance, and adherence to MDAC standards. Specifics evolve; check with MDAC directly.

Q: Can the city require the farmers' market to do something in return for the use?
A: The city can set conditions on the donation (e.g., insurance requirements, hours of operation, cleanup obligations). These aren't payments, so they don't change the donation analysis.

Background and statutory framework

Miss. Const. § 66 generally prohibits the donation or gratuity of public funds without specific legislative authorization passed by two-thirds of each chamber. § 95 prohibits donation of state lands to private corporations or individuals.

But the Legislature has passed a number of specific authorizations that fit within the Section 66 framework. § 21-19-69 is one, authorizing municipal support for certified farmers' markets.

The text of § 21-19-69:

The governing authorities of any municipality of this state, in their discretion, may donate annually out of any money in the municipal treasury, such sums as deemed advisable to support any farmers' market that is certified by the Mississippi Department of Agriculture and Commerce and operating within the municipality, not to exceed the amount that would be generated from the levy of a one-fourth (¼) mill ad valorem tax upon all taxable property in the municipality.

The discretion is at the municipal level. Cities can choose to support, or not. If they choose to support, the cap is the equivalent of one-fourth mill on taxable property.

The in-kind extension comes from a long line of AG opinions. The leading case is Manley (May 1, 2015), which held that statutory authority to donate funds includes the authority to make in-kind donations as an alternative.

The opinion is a clean, modest extension of established doctrine. The City can now donate use of the parking lot, with the standard documentation requirements.

Citations and references

Statutes:
- Miss. Code Ann. § 21-19-69 (municipal authority to donate to certified farmers' markets, capped at equivalent of ¼ mill ad valorem tax)

Source

• Landing page: https://attorneygenerallynnfitch.com/divisions/opinions-and-policy/recent-opinions/
• Original PDF: https://attorneygenerallynnfitch.com/wp-content/uploads/2023/11/R.Kirk-November-28-2023-Authority-of-Municipality-to-Donate-Space-for-Certified-Farmers-Market.pdf

Original opinion text

November 28, 2023

R. Adam Kirk, Esq.
Attorney, City of Winona
1320A Sunset Drive
Grenada, Mississippi 38901

Re: Authority of Municipality to Donate Space for Certified Farmers' Market

Dear Mr. Kirk:

The Office of the Attorney General has received your request for an official opinion.

Question Presented

May the city of Winona donate the use of a vacant, city-owned parking lot to a certified farmers' market, or is a rental agreement for a fee required?

Brief Response

Pursuant to Mississippi Code Annotated Section 21-19-69, a municipality may donate funds out of the municipal treasury to a certified farmers' market that is operating within the municipality. We find no prohibition against a municipality donating the use of a vacant city parking lot to a certified farmers' market in lieu of a rental fee so long as the requirements of the statute are met, and the value of the donation does not exceed the amount established in the statute.

Applicable Law and Discussion

As an initial matter, this office can neither validate nor invalidate past action. To the extent that your question involves any previous action taken by the city of Winona, we are unable to respond with an official opinion.

Mississippi Code Annotated Section 21-19-69 provides:

The governing authorities of any municipality of this state, in their discretion, may donate annually out of any money in the municipal treasury, such sums as deemed advisable to support any farmers' market that is certified by the Mississippi Department of Agriculture and Commerce and operating within the municipality, not to exceed the amount that would be generated from the levy of a one-fourth (¼) mill ad valorem tax upon all taxable property in the municipality.

Our office has consistently opined that when a statute authorizes a municipality to donate funds, it is implied that the municipality has the authority to make in-kind donations as an alternative. MS AG Op., Manley at 2 (May 1, 2015) (opining that donations made in accordance with Section 21-19-65 may be made in the form of cash or in-kind services) (internal citation omitted). See also MS AG Op., Baum at 1 (Feb. 17, 2006); MS AG Op., Hewes at *2 (Jan. 28, 2005).

Accordingly, if the municipality makes the factual determinations, pursuant to Section 21-19-69, that the farmers' market meets the certification requirements and that the value of the donation does not exceed the set limit, then the municipality may donate the use of a vacant, city-owned parking lot to the farmers' market in lieu of a rental fee. Because your request deals with the expenditure of public funds, we also refer you to the Office of the State Auditor.

If this office may be of any further assistance to you, please do not hesitate to contact us.

Sincerely,

LYNN FITCH, ATTORNEY GENERAL

By: /s/ Misty Monroe
Misty Monroe
Assistant Attorney General