Springfield Pension Blues
Two articles in the News-Leader have detailed the latest in the discussion about how Springfield should handle its pension shortfall. A special commission has been organized to try to come up with a solution, and I give them credit for considering all options. Here’s one possibility reported on by the second article:
Turn City Utilities into a publicly held corporation and sell stock to bolster the pension fund.
Springfield is in quite a financial bind, here, with a shortfall for multiple pensions of around $200 million. Voters recently decided not to raise taxes to fund the gap. Public employee unions have, not surprisingly, threatened a lawsuit, and it is just all around an ugly situation.
The solution, as mentioned above by one committee member, is staring Springfield right in the face. Every utility in Springfield is provided by the same government agency: City Utilities. St. Louis and Kansas City get by just fine with private, regulated utilities providing the bulk of the services. These private companies would be very willing to purchase a broken-up CU. Sale of the parts would net the city a great deal more than it would need to cover the shortfall, leaving plenty of money left over to cut taxes, etc.
Plenty more to come from the Show-Me Institute in the future about this subject.