County offers to settle lawsuit with Jackson

Friday, May 28, 2004

The Cape Girardeau County Commission has softened its firm stance on the road and bridge tax debate, a year-and-a-half-long legal dispute with the city of Jackson. At stake are annual payments of more than $80,000 and back payments to Jackson that could approach $500,000.

The commission made a settlement offer last week, a month before the controversial matter was to go to court. On Thursday, the commission discussed a counteroffer by the city of Jackson in a closed meeting.

After that meeting Thursday, Presiding Commissioner Gerald Jones volunteered no information about the offer other than to say, "We hope to get this settled before it goes to court on June 29."

Jackson Mayor Paul Sander agreed.

"It's in the best interest of everybody to try to get this settled before it goes to court in what could be a long, drawn-out battle," he said.

The issue centers on whether the county is obligated to reimburse the city 25 percent of the road and bridge taxes it collects from Jackson residents.

The city of Cape Girardeau lies in a special road district, so the issue does not apply there.

A state statute says the county must spend 25 percent of the special road and bridge taxes it collects from incorporated towns on roads and bridges within that town. The argument largely comes down to the legal meaning of a special tax. Jackson believes it means any tax specific to a particular area. The county contends it refers only to taxes that require a vote.

Last November, the commission voted not to accept any of Jackson's settlement offers, which included one for the county to begin paying the 25 percent in addition to contributing funds to the transportation development district formed to foster the planned East Main Street interchange. Commissioner Joe Gambill said the county should "vigorously" defend its position, and the other two commissioners approved the motion.

Open-meeting minutes from the May 20 meeting show that all three commissioners voted in favor of an offer to begin paying the 25 percent back to the city in exchange for exoneration from any revenue owed prior to 2004.

The commissioners, citing pending negotiations, would not comment on why they changed their minds.

A county commission letter to the city of Jackson dated March 1 included an offer from the county to pay $466,666 toward the East Main Street interchange to settle the lawsuit. The letter stated, "Cape County and our attorneys feel very strongly that we do not owe this 'special road and bridge tax' but are willing to come more than halfway to settle this issue for the common good of the people of Cape Girardeau County."

Jackson aldermen privately expressed concerns about accepting any offer that would relieve the county of what they believe is its legal obligation.

Jackson and county officials declined to talk publicly about negotiations, but the city appears to have rejected that offer. In the county's May 20 offer, it states that "any prior agreements regarding this issue shall be null and void."

The offer endorsed by the commission on May 20 was voted on in an open meeting during a portion not attended by the media. Discussion or action on the issue was not on the agenda.

The commission was within its rights Thursday to go into a closed meeting. A provision in the Sunshine Law allows governments to close meetings when litigation is involved. But the commission opted not to close its meeting on May 20, and the offer was included in the minutes.

Jones said the commission's attorney contacted the commissioners the morning of May 20, and the offer was drafted in fax exchanges throughout the meeting. Once the motion passed, it immediately was delivered to city hall.

This is the second time the commission has made a major decision on the controversial issue without listing it on the meeting agenda. The decision made in November to reject Jackson's offers also was left off the agenda.

The case has statewide significance since the issue has never been challenged in court. Most first-class counties, which are the only ones subject to the statute, pay towns and cities back the 25 percent. A few pay for roads and bridges through sales taxes. The statute does not apply to sales taxes, but every county except Cape Girardeau and Callaway reimburse cities within the county.

In Callaway County, the communities of Holts Summit and Fulton are waiting for the issue here to be settled. Callaway County has proposed a contract with both towns stating that the county will reimburse the 25 percent on the condition that the two return the money if a court ruling comes back in Cape Girardeau County's favor.


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