Cape City Council delays tax issue

Tuesday, May 21, 2002

The Cape Girardeau City Council agreed Monday night that three months is not enough time to persuade voters to approve a 3/4-cent sales tax increase.

Instead, it removed the issue from the agenda and will likely put the hike before voters in November.

A revenue team, assembled in October to come up with revenue solutions to help the city's shaky financial situation, recommended last month that the council put the 3/4-cent tax on the ballot for August.

Representatives on the team -- city employees who have been affected by a tight budget -- said they believed they could persuade voters of the justification of the half-cent parks and stormwater tax increase and the quarter-cent fire tax increase before August. And it was their opinion that more educated voters would show up in the August election. Plus, they said they didn't want the city sales tax increase to be on the same ballot as a possible state sales tax increase. That issue proved moot as legislation at the state level moved quickly and will appear on the August ballot instead of in November.

The council, which consists of four new members including the mayor, agreed unanimously that August was just too soon.

When discussion of the issue began at Monday night's study session, mayor Jay Knudtson and council members Evelyn Boardman, Charlie Herbst and Marcia Ritter all talked about public feedback opposing the tax hike on an August ballot.

"We would like to look into any ways we might be able to be more efficient," Boardman said after the meeting. "And we need further input from citizens before we put it on the November ballot."

The council uniformly believes that a massive education process should take place, one that would spell out exactly where the money will be going and how it will be spent. But that only comes after the city convinces the public of its fiscal responsibility.

"A lot of feedback I'm getting is people wanting to make sure of our efficiencies before we move on," Ritter said.

Budget option

Ritter asked finance director John Richbourg at the study session to provide the council with zero-percent sales tax increase numbers at a budget study session to be held May 29.

Ritter said at a recent meeting that the city should perhaps figure its budget based on no increase given that sales tax revenue has not come in at expected levels for the last three years, causing the city to dip into reserves.

This year's proposed budget has estimated a 3 percent increase, one that city manager Michael Miller says is reasonable.

Councilman Jay Purcell then asked the city to provide the council with a list of what services would have to be cut if the budget was figured with no increase in the sales tax.

"I understand the reasoning," Purcell said of the 3 percent increase. "But I was thinking, what would happen if I went to my bank and two or three years in a row, I didn't get the rent that I thought I was getting. It bothers me that we're going with a failing business plan. I think this is at least something responsible to look at."

Knudtson basically said that the situation is urgent, but not desperate. Knudtson, a banker, agreed with Purcell's analogy but, "if you do have $500,000 in a savings account, that would be a completely different situation."

Upon the request of councilman Hugh White, city attorney Eric Cunningham provided the council a proposed right-of-way monument policy at Monday night's council meeting.

The issue was brought up when St. Francis Medical Center requested a special-use permit to erect a monument in the middle of the roundabout on Silver Springs Road near the hospital.

The council, afraid to set a precedent, tabled the request, leery of what other businesses would be eligible to place monuments on public property and for what purpose.

During the study session, the council agreed that setting a policy would possibly create even more problems.

The monument would have been an entrance marker to the hospital, much like the Southeast Missouri State University signs on the edge of campus.

When the issue was brought up on the agenda, no one made a motion so the issue was dropped.

335-6611, extension 127

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