MS 2024-12-S-Watkins-December-2-2024-Municipality-as-a-Member-of-a-Chamber-of-Commerce December 2, 2024

Can a Mississippi city pay annual membership dues to a chamber of commerce?

Short answer: A Mississippi city may pay chamber of commerce annual membership fees if its governing authorities find, on the minutes, that the dues serve advertising and economic-development purposes under Section 17-3-1, Section 21-19-44, or another applicable statute. Sections 17-3-1 (advertising) and 21-19-44 (economic development organizations) are the standard authorities.

Disclaimer: This is an official Mississippi Attorney General opinion. AG opinions are persuasive authority but not binding precedent. This summary is for informational purposes only and is not legal advice. Consult a licensed Mississippi attorney for advice on your specific situation.

About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official AG opinion. The original opinion (linked at the bottom of this page, or PDF in the sidebar) is the authoritative source for any reliance.

View original AG opinion (PDF)

Plain-English summary

The Mayor of Quitman asked whether the city could pay chamber of commerce annual membership dues, and what statutes give the city the authority to do so. The AG identified two main statutory authorities and pointed to the city's own factual determination as the operative requirement.

Section 17-3-1, the "advertising statute," lets a Mississippi municipality "set aside, appropriate and expend moneys, not to exceed one mill of their respective valuation and assessment for the purpose of advertising and bringing into favorable notice the opportunities, possibilities and resources of such municipality or county." If the city makes the factual finding that paying chamber of commerce dues serves that advertising purpose, Section 17-3-1 supports the expenditure. The AG has used this statute to authorize chamber-of-commerce contributions consistently since at least 1982.

Section 21-19-44 lets municipalities "appropriate, contribute and donate to, or expend budgeted funds for, local economic development organizations and designated Main Street programs." A chamber of commerce is "per se, qualified to receive a donation by a municipality," but the city's governing authorities still have to determine, consistent with the facts, that the chamber may receive a donation under Section 21-19-44 (or a related statute). MS AG Op., Barton (Oct. 5, 2020).

Section 21-17-1(8) is another path, allowing municipalities to use city funds to "match any state, federal or private funding for any program administered by the State of Mississippi, the United States government or any nonprofit organization that is exempt under 26 USCS Section 501(c)(3) from paying federal income tax." This requires matching funds, not an outright donation.

The AG declined to opine on whether Quitman specifically can pay the dues; that determination requires the city's own factual finding on the minutes.

What this means for you

For mayors and boards of aldermen

The path is procedural. Decide first which statutory authority you are using. The two cleanest options are: (1) Section 17-3-1 advertising authority, where you find that the dues serve to advertise the city's opportunities, possibilities, and resources; or (2) Section 21-19-44 economic-development-organization authority, where you find that the chamber qualifies as a local economic development organization for the purposes of the donation. Either way, make the finding on the minutes before paying the dues.

Section 17-3-1 has a one-mill cap on aggregate advertising spending, so check that the chamber dues fit within the city's overall advertising budget. Section 21-19-44 does not have a similar one-mill cap.

For city attorneys

The opinion stacks well on the prior chamber-dues opinions: Horne (Feb. 22, 1982), Brooks (Mar. 5, 2010), Barton (July 24, 2015), and Barton (Oct. 5, 2020). The pattern is that the AG opinions confirm the statutory authority but emphasize that the city must make the factual determination itself. Templating a city's chamber-dues resolution to recite (a) the advertising/economic-development purpose, (b) the statutory authority used, and (c) the factual basis for the finding, is the cleanest way to harden the spending against later challenge.

For chambers of commerce seeking municipal membership

A Mississippi city can pay your annual dues, but the city's governing authority has to do the analytical work on its own end. Help the city by providing supporting facts: marketing reach, economic-development services, Main Street programming, member businesses recruited, and similar metrics that fit either Section 17-3-1's advertising purpose or Section 21-19-44's economic-development purpose.

For Main Street programs

Section 21-19-44 specifically references "designated Main Street programs," giving you a clean statutory category. If your program is designated, the city's appropriation authority is straightforward; the city still has to make the formal finding.

Common questions

Can a Mississippi city pay chamber of commerce dues?

Yes, with the right statutory authority and a factual finding on the minutes. The two primary options are Section 17-3-1 (advertising) and Section 21-19-44 (economic development).

What does Section 17-3-1 allow?

"The board of supervisors of any county in Mississippi, and the mayor and board of aldermen or board of commissioners of any municipality in the State of Mississippi, may in their discretion, set aside, appropriate and expend moneys, not to exceed one mill of their respective valuation and assessment for the purpose of advertising and bringing into favorable notice the opportunities, possibilities and resources of such municipality or county."

What does Section 21-19-44 allow?

Municipalities to "appropriate, contribute and donate to, or expend budgeted funds for, local economic development organizations and designated Main Street programs." The AG has treated chambers of commerce as per se qualified recipients, with the city making a factual determination.

What about Section 21-17-1(8)?

Section 21-17-1(8) allows city expenditures to "match any state, federal or private funding for any program administered by the State of Mississippi, the United States government or any nonprofit organization that is exempt under 26 USCS Section 501(c)(3) from paying federal income tax." This is matching funding, not an outright donation. Useful when a chamber-administered program (a 501(c)(3) program) has external funding the city wants to match.

Why doesn't the AG just say yes for Quitman?

Because the AG can opine on prospective questions of state law but does not make factual determinations. Section 7-5-25. Whether Quitman's chamber-of-commerce dues in fact serve the Section 17-3-1 advertising purpose or Section 21-19-44 economic-development purpose is a factual determination for the city.

Does the city have to be a member of the chamber to pay the dues?

The opinion treats the dues themselves as the contribution. The city's "membership" status is a function of paying the dues. Whether the chamber gives the city governing-body member status, voting rights, or other features is between the city and the chamber.

Background and statutory framework

Section 17-3-1, advertising statute. Authorizes counties and municipalities to expend up to one mill of their valuation and assessment to advertise and bring into favorable notice the opportunities, possibilities, and resources of the jurisdiction.

Section 21-19-44, economic development organizations. Authorizes municipalities to appropriate, contribute, donate to, or expend budgeted funds for local economic development organizations and designated Main Street programs.

Section 21-17-1(8), matching funds. Authorizes municipalities to match state, federal, or private funding for programs administered by the State, the federal government, or a 501(c)(3) nonprofit.

Section 7-5-25. Limits AG opinions to prospective questions of state law and excludes factual determinations.

Citations

Miss. Code Ann. § 17-3-1
Miss. Code Ann. § 21-19-44
Miss. Code Ann. § 21-17-1(8)
Miss. Code Ann. § 7-5-25
MS AG Op., Horne (Feb. 22, 1982)
MS AG Op., Brooks (Mar. 5, 2010)
MS AG Op., Barton (July 24, 2015)
MS AG Op., Barton (Oct. 5, 2020)

Source

Original opinion text

December 2, 2024
The Honorable Steve Watkins
Mayor, City of Quitman
Post Office Box 16
Quitman, Mississippi 39355-0016
Re:

Municipality as a Member of a Chamber of Commerce

Dear Mayor Watkins:
The Office of the Attorney General has received your request for an official opinion.
Questions Presented
1. Mississippi Code Annotated Section 17-3-1 provides that a municipality may expend monies
"for the purpose of advertising and bringing into favorable notice the opportunities, possibilities
and resources of such municipality." Is there some other Mississippi statute or regulation that gives
a municipality the authority to join a local chamber of commerce and pay annual municipal
membership fees?
2. May the City of Quitman ("City") pay chamber of commerce annual municipal membership
assessment fees?
Brief Response
1. Upon the proper factual determination, a municipality may contribute funds to a chamber of
commerce pursuant to Sections 17-3-1, 21-19-44, or another applicable statute.
2. See Response 1. The City may only pay the chamber of commerce annual membership fees if
the expenditure conforms with Sections 17-3-1, 21-19-44, or another applicable statute, which is
a factual determination for the City to make.
Applicable Law and Discussion
Initially, your request asks whether there is any statute other than Section 17-3-1, commonly
referred to as the advertising statute, that allows a municipality to pay annual membership fees to
a chamber of commerce. Prior opinions have consistently cited Section 17-3-1 as the authority for
municipalities to contribute or pay membership fees to chambers of commerce. See MS AG Op.,
Horne at 1 (Feb. 22, 1982); MS AG Op., Brooks at 1 (Mar. 5, 2010). Pursuant to Section 7-5-25, opinions of this office are issued on prospective questions of state law. We do not make factual
determinations by official opinion. This opinion does not purport to list every statute that could
apply to your situation, nor can we opine on whether it is legal for the City to pay the chamber of
commerce membership fees in this instance, as these would both require our office to make factual
determinations. With these limitations, we offer the following for future guidance.
Section 17-3-1 provides:
The board of supervisors of any county in Mississippi, and the mayor and board of
aldermen or board of commissioners of any municipality in the State of Mississippi,
may in their discretion, set aside, appropriate and expend moneys, not to exceed
one mill of their respective valuation and assessment for the purpose of advertising
and bringing into favorable notice the opportunities, possibilities and resources of
such municipality or county.
Upon the appropriate factual finding by a municipality that the funds will be used in accordance
with Section 17-3-1, this advertising statute allows the municipality to provide money to a chamber
of commerce. Further, Section 21-19-44 allows municipalities "to appropriate, contribute and
donate to, or expend budgeted funds for, local economic development organizations and
designated Main Street programs." When asked whether a municipality could donate the use of
municipal facilities to a chamber of commerce under Section 21-19-44, this office opined:
While the above-cited opinions issued by this office have concluded that a local
chamber of commerce is, per se, qualified to receive a donation by a municipality,
it is the opinion of this office that the governing authorities of a municipality must
determine, consistent with the facts, that the local chamber of commerce may
receive a donation pursuant to Sections 21-19-44 - 44.1, Section 21-17-1(3)(a)(1),
(3)(b)(ii), or another applicable statute.
MS AG Op., Barton at 2 (Oct. 5, 2020) (internal citations omitted); see also MS AG Op., Barton
at 2 (July 24, 2015). This remains the opinion of this office. Accordingly, if a municipality
determines that contributing to a chamber of commerce by way of membership dues is for the
purpose of advertising and bringing into favorable notice the opportunities, possibilities, and
resources of the municipality pursuant to Section 17-3-1 or that Section 21-19-44 or another statute
applies, it may provide funds to the local chamber of commerce. As stated above, whether it is
legal for the City to pay the chamber of commerce annual municipal membership assessment fees
in this particular instance requires a factual determination by the City and is outside the scope of
an official opinion.

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/ Beebe Garrard
Beebe Garrard
Special Assistant Attorney General