Cape Girardeau County, cities see slight sales tax revenue gains in first half of year

Cape Girardeau County consumers are spending slightly more this year, according to local sales tax revenue.

Sales tax collections are up so far this year by more than 2 percent in both Cape Girardeau County and the city of Cape Girardeau. In Jackson, sales tax collections are up 4.2 percent, primarily due to a new quarter-cent fire protection sales tax that took effect in May.

City and county officials are encouraged by the slow but steady growth they're seeing.

After sales tax revenue declines during 2008 and 2009, last year Cape Girardeau, Jackson and the county collected about 2 percent more in sales taxes. So far, 2011 is on a similar trajectory.

Before 2008, local governments saw annual growth in sales tax of around 4 percent, twice the rate it's growing now.

"It looks like we've gone from good to bad and are starting to go back the other way. But with all the things going on, it's hard to say we're out of the woods for good," said Cape Girardeau city finance director John Richbourg.

From January through July, Cape Girardeau collected $14.9 million in general revenue, fire, park and stormwater, sewer, transportation and water sales taxes, an increase of 2.4 percent from the same period last year.

Cape Girardeau County collected $3.8 million in general sales tax and $638,415 in Proposition 1 sales tax, which supports the sheriff's department and county roads. County general sales tax collections have increased 2.4 percent and Proposition 1 sales tax increased 2.5 percent, compared to January to July 2010.

"In the past, it used to go up, three and a half to 4 percent; that was almost expected. This year, I think two and a half percent would be a good thing, and I think it's very reachable," said Cape Girardeau County Treasurer Roger Hudson. County sales tax collections have picked up in the second quarter this year, after being down 6.3 percent in the first quarter, he said.

In Jackson, general sales tax and transportation sales tax collections are down 0.45 percent, but a new fire protection sales tax that took effect in May generated an additional $81,859 to make the city's total tax collections higher than they were this time last year.

From January through July, the city collected a total of $1.8 million.

Jackson Chamber of Commerce executive director Brian Gerau said the retailers he's been working with are just trying to maintain their businesses and having varied degrees of success depending on what they sell.

"Some are doing fantastic, others are just trying to get by," Gerau said. "Most of them are feeling positive. They're trying to retain their clients and make sure those people are coming back. It's a lot easier to keep current clients than go out and dig up new ones."

Consumer spending accounts for about 70 percent of the total spending in the U.S. economy and is crucial to continued economic growth, said Dr. Bruce Domazlicky, director of the Center for Economic and Business Research at Southeast Missouri State University.

"If consumers are increasing their spending as indicated by increases in retail sales, then I take that to mean they are fairly confident about their economic situations, which is a good sign for the economy," Domazlicky said.

Nationally retail sales have been growing each month this year, with the exception of a dip in May. They quickly rebounded by rising slightly in June, according to the U.S. Commerce Department.

"If gasoline prices remain stable, or even fall, economists expect some pickup in retail sales in the second half of the year," Domazlicky said.

Cape Girardeau Mayor Harry Rediger, a retired J.C. Penney manager, said he is encouraged with the consistency of the city's small sales tax growth.

"It's been minimal, in the 1 to 2 percent range for the past two years, but we haven't experienced the dip in sales many communities and metro areas have," Rediger said. "We'd like to be growing at a higher rate, but so many communities have been hurt by this economy. We can be thankful for the consistency of our sales."

Rediger said he's anxious to see how the holiday shopping season will affect year-end sales tax totals. "The last quarter is very significant," he said.

mmiller@semissourian.com

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Jackson, MO

Cape Girardeau, MO