Cape officials prioritize addressing labor shortage with future use tax revenue

Tuesday was a big win for Cape Girardeau, according to city manager Kenny Haskin.

Voters approved a local use tax that may provide the City of Cape Girardeau millions of dollars a year. Revenue from the tax will not be received from the city until the first quarter of 2023, but in the meantime, Haskin said a plan is being devised on how to appropriate a portion use tax funds for recruitment and retention of city employees.

According to Haskin, the city currently seeks to fill more than 40 vacant positions across all its departments. The Cape Girardeau Police Department is short 13 officers. The Public Works Department is "hanging from a shoestring," he said.

"To make sure we provide quality services, we've got to be able to bring quality people into the organization," Haskin said. "Having over 40 positions open in critical, key roles is really unacceptable at this point."

According to Mayor Bob Fox, the city's staffing crisis could have been avoided a long time ago; Tuesday was the city's fourth attempt at passing a use tax.

"If we had that tax all this time, we'd have had millions and millions of dollars in revenue," Fox said. "I don't think we'd be in the shape we're in now with our salaries at such a low level."

In the last few years, Fox said he's watched employees leave their positions with the city to work elsewhere for higher starting wages.

Cape Girardeau police officials have been vocal in the past about officers leaving the department for positions in other cities that pay better.

Approximately half of all Missouri cities with populations more than 2,000 already have a use tax, including Sikeston. Sikeston voters approved a use tax in 2019. Collection began in 2020.

Because of conservative budgeting, unexpectedly robust sales and use tax revenue during the pandemic, Sikeston's general fund balance "grew considerably" in the latest completed fiscal year, according to the city's latest budget.

Even after spending nearly half a million dollars on two major parks projects, Sikeston's general fund balance will be at 53% of revenue, significantly higher than the 25% required by city policy. The city was also able to include a $2,000 annual wage increase for all regular employees in its budget for fiscal year 2022.

Use tax revenue may be used for more than employee salaries and benefits, Haskin said, but it depends on how much the tax generates for Cape Girardeau.

The city's first priority will focus on staffing issues.

"Whatever that takes, we're going to address that first," Haskin said.

With stimulus money, rent subsidies, unemployment benefits and more, the COVID-19 pandemic brought the city's sales tax receipts up higher than what they would normally be, according to Fox.

"That will give us a little bit of a cushion next year," Fox said, adding once Cape Girardeau starts collecting use tax revenue in 2023, the tax would provide financial stability "for years to come."

"We are so very grateful for the vote of confidence by the citizens in our city, and would also like to thank our community leaders for their support," Haskin said.