Wait for upturn instead of using city reserves

There is little doubt that Cape Girardeau is facing a financial pinch. The city's department heads have explained how their needs are not being met. Equipment is out of date. Buildings are too small. Repairs are being put off. But in the budget currently under consideration, all of the city programs for residents are still there.

But some city employees faced the possibility of receiving neither a merit raise nor a cost-of-living increase this year. And that's where the council was divided when the budget came up for first-round approval last week.

The proposed budget would have a $250,000 shortfall if revenue doesn't grow instead of having an anticipated 3 percent gain. Revenue has been affected by three years of flat sales tax -- years in which city government grew in both personnel and payroll. The proposed budget includes a 1 percent pay increase -- $111,246 total -- for city employees.

One councilman, Jay Purcell, believes withholding the raises would cut the potential shortfall to a more manageable level. Other council members expressed various reasons to proceed with the increase.

The city's reserves are at $425,000. It would take more than half of that to cover the potential deficit in the proposed budget, leaving Cape Girardeau dangerously exposed.

Councilman Hugh White said city employees always pay the price in a budget crisis. He said the council should wait and see what happens with the economy before making drastic cuts.

Mayor Jay Knudtson, a banker, said economic forecasts are good. He indicated that, with three new council members this year, it is the time to trust the city employees who drew up the proposed budget.

It is important for the city to do what it can to retain good workers. And fair compensation is part of job satisfaction.

However, an examination of city salaries here and in similar-sized communities in Missouri and other states shows that, while Cape Girardeau lags behind in some areas, the city's salaries are more or less in line.

Another consideration is that the council is likely going to ask voters in November to approve a 3/4-cent sales tax increase. If there was ever a time to be overly cautious with expenditures, it is now.

Think about what private-sector employers would do given a similarly dire situation. Chances are, they would flip the timetable of the council. Instead of approving a budget that might cut into reserves, they would hold off on some spending until the revenue picture improved.

Are Cape Girardeau taxpayers concerned about the city's spending plans? Not one citizen attended a public hearing on the budget. However, it is not too late for the residents of Cape Girardeau to weigh in with their councilmen on how the city should be managed financially.