Bills could cost county revenue

Monday, January 26, 2004 | 12:00 a.m. CST; updated 8:45 p.m. CDT, Monday, July 7, 2008

Nike Thompson is keeping a close eye on the state budget process this legislative session.

As a state lobbyist for Boone County government, Thompson worries that a projected state revenue shortfall of $773 million might roll “downhill to the county” in the form of unfunded mandates and that other legislation might cost the county revenue.

Whenever the General Assembly goes into session, both county and city governments have to be on guard for revenue cuts and extra fees that are often handed down from the capital, said executive directors of the Missouri Association of Counties and the Missouri Municipal League.

The state tax on motor fuels is one of the areas Thompson’s watching. The Missouri Constitution currently requires that 25 percent of the fuel tax money be sent to counties to fund road and bridge projects, he said. Boone County’s budget contains about $1.24 million of the fuel tax revenue for the 2004 fiscal year, according to County Auditor June Pitchford.

And while he’s seen no proposals yet that would dip into counties’ share of the proceeds, Thompson knows that legislators are contemplating a number of strategies for funneling more money to the financially strapped Missouri Department of Transportation.

“There’s a major feeling right now that the Department of Transportation needs money,” he said.

Protecting their funding can also be a challenge for cities and counties when legislators propose sales tax exemptions — such as the sales tax holiday scheduled in August that both the city of Columbia and Boone County have chosen not to honor. Sales tax accounts for 61 percent and 14 percent of county and city revenue, respectively.

“Every year, there’s bills that reduce municipal revenues,” said Gary Markenson, executive director of the Missouri Municipal League.

Several new tax exemptions have been proposed in the legislature this session, including an exemption for health club services. That bill is sponsored by Sen. Ken Jacob, D-Columbia.

“That’s a fairly minor one, but it’s an example of nickeling and diming you to death,” Markenson said.

For the city, extra costs in the past have also come in the form of fees for landfills or sewer utilities, Assistant City Manager Bill Watkins said.

Watkins’ concern this session is a bill that would eliminate the tax on hotel and motel stays for nonprofit organizations. Columbia relies on a 4 percent “bed tax” to fund the Convention and Visitors Bureau.

Bureau Director Lorah Steiner said she had just learned of the legislation and had not had time to assess its potential impact. The loss of revenue could be substantial, she said, depending on whether rooms rented for conferences could be eligible for the exemption and on how many kinds of organizations would qualify as nonprofit under the legislation.

“While I understand the intent of the bill, what remains to be seen is the impact on the economies of the cities all across the state,” Steiner said.

Markenson cited a number of other bills that could affect municipal coffers. One would require more formal disciplinary hearings for police officers and would increase administrative and legal costs for cities, he said. Another would make open records cheaper for the public by making the first hour of research on records free and restricting the hourly cost of additional staff time to the lowest wage paid within the department.

These kinds of mandates and increased administrative costs hurt city residents, Watkins said, because they take away money and time that could be devoted to services.

“Cities work very hard to be fiscally prudent, as I’m sure the state does as well,” Watkins said. “But it can be particularly difficult if the cities are doing the best jobs they can and additional requirements are then placed on them that they have no say-so in.”

While Thompson is helping the county keep an eye on revenue and cost threats, he’ll also be pushing to get several items on the legislative agenda. They include:

n Enabling the county to cut weeds on vacant lots in subdivisions and to remove junk metal left on private property.

n Allowing the county to enact a half-cent recreation sales tax on items sold at the Boone County Fairgrounds. The tax would pay for fairground maintenance and perhaps the creation of soccer and softball fields.

n Cutting costs for contractors doing business with the county by allowing them to use cash bonds as security instead of surety bonds, which are purchased from insurance companies that charge a premium.

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