Ferguson, Missouri Will Not Be Improved by More Special Taxing Districts
Ferguson, a suburb of St. Louis County which you may have heard of, is launching a new community improvement district (CID). CIDs are special taxing districts that levy taxes to fund public improvements within a designated area. However, there are significant issues with CIDs, and, upon review, the one proposed for Ferguson seems to embody just about all those problems.
The Missouri State Auditor’s office has documented numerous flaws in CIDs. At the public meeting on the Ferguson CID last week, one of the speakers even encouraged the city council to review one of these audits to give the city guidance. (I would be surprised if the city did that, but I’d love to be wrong.) Among the many issues with CIDs: lack of transparency; improper oversight once established; failure to follow required rules for dealing with tax dollars, including lack of public bids and private use of tax funds; and erroneous tax collections. Perhaps the largest problem with CIDs is that they are frequently used to fund private entities with public tax dollars. Things such as private business parking lots should be—and until very recently were—considered private items to be funded by businesses, not taxpayers.
The proposed CID in Ferguson is a new tax for only one parcel of land that will authorize a sales tax for the new stores going into the development. Essentially, this project will use public tax dollars for private purposes. The board of the CID consists mainly of representatives of the developer, so the private interests of the developer will be their focus, not the proper use of tax dollars. (To be clear, two of the five members of the board are public representatives, but—despite being no math genius as best I can telltwo is less than half of five.) The developers claim that this parcel is blighted, which is highly questionable. It is adjacent to the very nice campus of Florissant Valley Community College. There is no public vote on this CID—it is a mail-in ballot voted by only the property owner(s), who will likely vote to support the new, surreptitious tax on their own customers that will be used to benefit the property owners.
This proposed CID will have no public vote, little public benefit, and very limited public oversight. This is not the way to go forward for Ferguson. CIDs like these should be stopped and the state should make substantial reforms to the CID rules.
