TAXES IN ACTION; RISING TAX REVENUES DON'T MEAN WINDFALLS

Although expected revenues from real estate and property taxes continue to rise, Cape Girardeau County's cities, school districts and fire districts aren't necessarily enjoying big financial windfalls.

"People sometimes forget that the expense side does not stay static," said Jackson School District superintendent Howard Jones.

The boom in construction of new homes and commercial properties has increased the tax base in Cape Girardeau County, but growth also has the downside of putting more service demands on the various taxing entities.

Most cities and school districts in the county are experiencing revenue growth. The county's seven rural fire districts also are seeing revenues rise, but only slightly.

Jackson City Administrator Steve Wilson said that while the explosion in residential construction has been beneficial, it also means the city is burdened with maintaining, repairing and improving more roads, running more sewer lines and simply dealing with an increased number of patrons. Tax revenue, he said, doesn't immediately cover those expenses.

"It's a slow payback time before the city breaks even. The fact is, services cost more than can be recouped from taxes for many years," said Wilson.

In addition to construction growth, Cape Girardeau County Assessor Jerry Reynolds said county residents are trading in their older cars and trucks for newer, more expensive models. Because automobiles account for the bulk of personal property tax revenues, new car purchases can have a major impact.

"All of that adds to the tax base, and the tax base times the tax rate equals a lot of new tax revenue," Reynolds said.

Although rates vary throughout the county, Reynolds tagged the average rate at around $4 per $100 assessed valuation.

The county's total assessed valuation increased nearly $28 million dollars in 1996, up to $572,114,605 from $544,185,279 in 1995. Considering the steady growth in recent years, Reynolds said such an increase is common.

"Now it's not unusual to have a $20 million increase in the assessed valuation, but that is good because it shows growth," Reynolds said.

Cape Girardeau City Manager Michael Miller said growth and an expanding tax base are vital.

"That's the kind of thing we like to see," Miller said. "That's what makes a community viable and exciting, and that's exactly what Cape is."

The city expects to collect over $170,000 more this year from real estate and personal property taxes, partly from a 3-cent rate increase. However, those gains could be offset by flat sales tax revenues.

John Richbourg, Cape Girardeau's finance director, said sales tax revenue for the first four months of the current fiscal year has been down by about 1 percent. The city sales tax revenue usually rises about $7 million annually.

The Cape Girardeau School District is slated to collect nearly $447,000 more for 1996 than in 1995 for a total of $8.7 million.

Although the district doesn't bank on 100 percent collections, instead setting its budget based on a 92 percent collection rate, the district actually brought in more revenue than it expected last year.

In 1995, the district expected a total of around $8.3 million. However, combining the then-current and delinquent taxes from previous years, the district collected almost $8.5 million.

Superintendent Dan Tallent said this year's budgeted growth has already been spent.

"The two big items that ate up any increases were salary increases and building maintenance," Tallent said.

The Jackson School District expects to collect almost $700,000 more this year thanks in large part to a voter-approved bond issue and rate increase. The tax rate for district residents increased 20 cents to $3.21 per $100 assessed valuation.

The increase is going to fund construction of two new elementary schools, a new math and science building on the high school campus and to pay off debt from the recent construction of a new middle school

The rate can be adjusted under a formula set by the state auditor. If the district's tax base continues to expand, Jones said the levy could be rolled back slightly.

"With the growth rate we've had, the debt service levy could go down," Jones said. "It would not take as many pennies on the base to make payments."

The Delta School District did just that this year, slicing 18 cents off its tax rate.

Of the total rate of $3.37, 62 cents goes to service the debt on recent construction projects, down from 80 cents and a total rate of $3.55.

"Now we have a sufficient reserve to meet our obligations according to the state auditor's formula," said Superintendent Larry Beshears. "We hope to continue going down slightly for here on."

The projects resulted from a $1.5 million voter-approved measure to build a 20,000-square-foot addition at Delta High School, renovate the elementary school and install central heating and air conditioning in all the class buildings.

"I know teachers and students are pleased with the facilities, and all of the comments I've heard from patrons have been positive," Beshears said.

The Nell Holcomb School District will experience a drop in collections, from a 1-cent rate reduction resulting from a Proposition C rollback as well as a decline in its manufacturing base from depreciation on equipment at M&W Manufacturing.

However, Superintendent David Fuemmeler doesn't expect the $41,000 drop to have either a major impact or to be permanent.