SALES TAX KEEPS COUNTY FINANCIALLY SOUND

While many counties in Missouri struggle toward the end of every year to make ends meet, Cape Girardeau County government enjoys exceptional financial health year after year, thanks to a countywide sales tax.

The county hasn't imposed a general-revenue tax levy on real estate since 1981, and then it was only 11 cents per $100 assessed valuation. The county was able to scrap the levy when voters authorized a countywide half-cent sales tax. The tax generates approximately $5 million a year. Coupled with various fees, revenue from the sales tax has become more than enough to run county government.

The county continues to levy a 22-cent road and bridge tax, which will produce almost $565,000 this year. All of that money and more goes to the operation of the county highway department and road and bridge construction and maintenance.

The county's annual operating budget is about $12 million a year, including $2 million for road and bridge operations. But the county enjoys large reserves that currently stand at $7 million, $5 million of which is invested and $2 million set aside for capital improvements. A couple of years ago the reserve fund topped $9 million, but a new archives center and jail expansion ate up about $2 million of it.

For those who might think the county shouldn't have that much money lying around at the end of every year, consider the fact that $5 million produces substantial additional interest income. Without those reserves, the county wouldn't be able to operate at current levels on just the sales-tax revenue and fees and probably would have to impose a real estate levy.

Cape Girardeau County is among only 15 in Missouri that have been able to eliminate the real-estate tax levy. Many other counties also have sales taxes, but they don't produce the kind of revenue Cape Girardeau County's one-half-cent tax does.

The Cape Girardeau-Jackson area serves as a retail shopping hub for surrounding Missouri and Illinois counties, and those shoppers end up paying much of the sales taxes that support county government.

In that regard, the county enjoys a real bonanza.