TIF IS OUT; BACKERS: NEW PLAN WON'T HURT SCHOOLS

JACKSON -- City, county and school officials aren't supporting a tax increment financing district anymore, but they still want the improvements it would have provided.

The Interstate 55 Corridor TIF Commission met Thursday at the County Administration Building in Jackson. Members were to determine if they wanted to continue work on a TIF district, expected to be established by mid-December. They voted to stop and divert their attention to another financing mechanism.

In a TIF district, cities and counties use specific sales taxes to fund infrastructure improvements within a specified area. In Cape Girardeau County, the TIF district would have taken in Nash Road, Cape West Business Park and the intersection of Interstate 55 and Highway 61, commonly called Center Junction.

Commissioners planned to make 1995 the district's base year, with the sales taxes collected from businesses in the district that year being the base amount. Fifty percent of sales taxes collected over the base year amount would be earmarked for infrastructure improvements.

With the money, the TIF Commission wanted to provide potable water to Nash Road businesses, extend more water lines to the west side of Interstate 55 and redesign Center Junction to make it safer.

Bonds would have been sold to finance improvements. Some on the commission worried about a provision that requires TIF participants to promise property tax money if there isn't enough sales tax the pay off the bonds. A slow economy could mean taking money from school districts.

The end of the TIF district doesn't mean the end of those projects, Cape Girardeau County industrial recruiter Mitch Robinson said at Thursday's meeting. It just means a different funding mechanism.

Cape Girardeau Finance Director John Richbourg said the county and the cities of Cape Girardeau and Jackson could sign an inter-governmental agreement to set aside sales tax revenue for improvements. Instead of selling bonds, the governments would sell certificates of participation.

With certificates of participation, the debt service is paid with an annual appropriation from the issuing body. With revenue bonds, the issuing body is agreeing to increase taxes or make some other change to pay off the bonds, Richbourg said.

Certificates of participation also yield lower interest, making them less expensive for issuing bodies. The money used to pay them off doesn't come from one particular business, although Cape Girardeau officials are counting on a new Sam's Wholesale to generate enough extra sales tax.

And property taxes don't have to be promised to pay them off.

Dr. Dan Tallent, Cape Girardeau School District superintendent, said he supported the alternate financing mechanism.

"As a school district, we want the community to move forward and grow," he said. "Our long-range plan is based on the expectation that our economy will grow. At the same time, I'm glad to see that growth may be stimulated through other means than putting property taxes at risk."

Only governments that stand to benefit from projects will be involved in the individual agreements. For example, only Cape Girardeau and Cape Girardeau County will work together on water lines to Route K west of Interstate 55. But those two governments plus Jackson will cooperate on Center Junction.

Presiding County Commissioner Gerald Jones said he wanted to be sure the county got a voice in all the projects. He also wanted to be sure future commissioners couldn't back out of agreements.

"Apparently, this way isn't as binding or as clean as a TIF district, but if it works, who cares?" Jones said. "My concern is that not all of us will be here in 20 years."

Cape Girardeau City Manager Michael Miller said attorneys would be sure the agreements were binding before any certificates of participation are sold.

Jones didn't dissolve the TIF Commission, but he said that might happen at the commission's next meeting. The group also voted to cancel a public hearing on the TIF district that was scheduled for Dec. 2.