STABILITY BENEFIT OF COUNTY TAX

JACKSON -- The emergence of Cape Girardeau County as a sound financial entity can be traced to county voters enacting a half-cent sales tax in November 1979.

Cape Girardeau County was one of the first counties to enact sales taxes.

The law provided for half the sales tax to go toward rolling back the general revenue property tax levy, and the remainder toward increasing the county's general revenues.

"There was quite an effort by county governments in the state to get this authority through the legislature," said County Clerk Rodney Miller. He took office in 1979.

County Auditor H. Weldon Macke was serving as an officer of the Missouri Association of Counties when the heavy push was made to persuade lawmakers that counties needed this authority.

"Counties all over the state were having a hard time making ends meet," Macke said. "Many were borrowing on next year's taxes a year or more in advance. When the sales tax came along, it looked like a godsend."

Former Presiding Commissioner Gene Huckstep said when he took office in 1979, the county's financial outlook was bleak.

He remembers the county borrowing in April against the following January's receipts.

"That was pretty routine back then," he said.

When the sales tax opportunity came, county officials pursued it.

Huckstep, Macke and Miller agree that telling voters they could have half their property taxes reduced was a big selling point. And, there was also something attractive about having shoppers from outside the area paying county taxes.

Although the sales tax was difficult to pass in some counties, county voters supported it by a 3-to-1 margin, 3,361 to 1,095.

The tax took effect Jan. 1, 1980; the first check to the county was in March 1980 for a little more than $83,000. The last 1994 check was for $452,000.

In 1981, the first full year the sales tax was collected, the county took in $1.68 million. Revenues have climbed every year since, including by 10.77 percent last year to $3.82 million. Annual increases have always been more than 4 percent, except for 1991 when the increase from 1990 was just .28 percent.

Within two years after the sales tax was initiated, the county had a surplus.

In 1979, the county was in debt about $75,000. On Dec. 31, the county had a $6.6 million surplus.

Huckstep and then associate commissioners, Leonard Sander and J. Ronald Fischer, invested some money for emergencies and capital improvements.

"We decided not to go into debt for anything," Huckstep said. "We wanted to be a pay-as-you-go county."

That approach enabled the county to pay cash for a new administration building and furnishings that cost more than $1.5 million, cover $750,000 in damages from the 1986 flood, match any federal funds that were available for new bridges and purchase some land adjacent to the county park, the jail and the county highway shed for future expansion.

The county's financial condition continued to improve. A combination of a period of high interest rates, a massive expansion of Cape Girardeau as a regional center and an attitude by commissioners to carefully scrutinize expenditures, only enhanced the impact of the sales tax.

After the first year, the rollback on the property tax went from 50 cents to 35 cents, and by 1982 it had fallen to 17 cents. At that point Huckstep, Fischer and Sander agreed to abolish it altogether. Over a period of several years, they forgave nearly $3 million in taxes that could have been collected.

Once the county became affluent, Huckstep found that protecting county resources would not be easy without a hard-nosed approach.

"If you've got money, there are all kinds of people trying to get it," he said. "We constantly had to balance what was needed and what people desired."

For the county to remain fiscally sound, Huckstep said the new commission needs to be willing to take the abuse that goes with saying no. He agrees the county can't keep piling up huge surpluses, but also warns that big cost items like solid waste management and a new jail are on the horizon.

His advice to Presiding Commissioner Gerald Jones, and Associate Commissioners Larry Bock and Joe Gambill is to get tough.

"There are some unhappy segments of county government that feel like they should have more money, and see this as an opportunity to get it," he said. "They knew I would have to die or get out sooner or later, and decided to wait me out."