TO TAX OR NOT: COUNTY COMMISSION CONSIDERS REVENUE

JACKSON - The combination of flat sales tax revenue, reduced interest income, and an increase in the cost of living has the Cape Girardeau County Commission wondering whether it needs to find some additional revenue.

For the last nine years, because of revenue from a half-cent sales tax, the county commission has not levied a property tax for general revenue, forgiving over $2 million in taxes during that time.

The ability to operate without a property tax has been a point of pride for the county commissioners. But now, Presiding Commissioner Gene Huckstep says the commission may have to change its stance.

"We're just going to have to do something," said Huckstep. "We need to look at any sources of income we've got there."

Huckstep explained that costs are increasing for things like insurance, employee benefits, equipment and utilities, and the county's financial outlook is not as bright as it once was.

Besides the increased costs, the county's sales tax growth this year has been flat and, after eight checks for 1991, is running slightly behind last year. Normally growth is about 6 percent, and some years, higher.

Another problem is that the county will be receiving over 3 percent less in interest on county general revenue and the capital trust account. Interest earned on general revenue is earmarked for the road and bridge fund, while the capital trust interest is kept in that fund.

The loss in money for the road and bridge fund could force the commission to consider increasing its property tax levy. The present levy is 23 cents, however, the commission could legally levy up to about 35 cents without getting voter approval.

State law requires counties to roll back the general revenue property tax rate equal to half of its sales tax revenue. Under the rollback provision, Cape County would only be able to levy a property tax of about 2 cents, which would generate about $90,000.

Huckstep said he isn't sure whether it would be worth putting a 2-cent levy on this year, but stressed it is worth considering.

Huckstep said the commission could make up for the shortfall without additional revenue by transferring money from the capital trust account, and then hope that interest rates and sales tax revenue rise next year.

The capital trust account has about $2 million in it and has been used to purchase land adjacent to the highway department shed, build bridges, purchase expensive highway equipment, and has funded the construction of an administrative office building.

In past years, the commission has transferred some of its 5 percent contingency fund to the capital trust account as a way of replenishing funds that were spent during the year. This year, Huckstep does not know whether the county will have funds to transfer.

"We've always been able to save a little bit, but it's getting to be a little nip and tuck for this year," said Huckstep. "We might be able to get by in the short term, but I'm worried about the long run and our ability to maintain the savings fund."

Huckstep, whose present term expires at the end of 1994, said that he wants to leave office with a large balance in the capital trust account.

Associate Commissioner Leonard Sander, who oversees the highway department, agrees the commission will have to at least consider raising the property tax levy this year.

"If we continue trying to keep everything in the shape we have it in now and keep replacing equipment like we have, we're going to have to do something to get extra money," observed Sander. "We can't keep dipping into the capital trust account, because the first thing you know we won't have any money there."

Sander noted that the county was able to absorb the loss of federal revenue sharing several years ago, which was used completely for roads and bridges.

"We may very well be at the point where we have to raise the tax levy or cut services," said Sander. "I always hate to think about not doing things you've done in the past; we always hope to do a little more."

Cape County's road and bridge budget is about $1.7 million. The county highway department maintains about 600 miles of roads.

Huckstep pointed out that Cape County will likely have to use some of its capital trust account next year to fund a renovation and expansion of the juvenile detention center, and to build an addition to the county jail to increase space for female prisoners.