Municipal Advocacy With Your Money?

Posted on by David Stokes

A recurring issue in local government in Missouri is when cities, school districts, and other entities improperly use taxpayer money to advocate for tax increases on the ballot. Now, of course, they don’t say they advocate. They say they are only giving out neutral information, which can be allowed. But there are plenty of examples of what appears to be outright advocacy. When you read pieces like this, do you really think the language is unbiased and that an ordinary voter would not take the information as supporting the tax increase? From the piece:

How can a Use Tax benefit my community?

As internet purchases increase, local revenues decrease. Funds generated from the Use Tax can be used to pay for vital municipal services including Police, Parks, and Public Works services.

You will note there is no opposing argument mentioned. If you read this and truly think it is neutral, I imagine you are the type of person who really tried to remain friends with your ex-girlfriend when they dumped you in order to “just be friends.” Hint: the pieces aren’t neutral, your ex really didn’t want to be friends, and it really was you, not them.

Show-Me Institute researchers have filed Sunshine Law requests with two cities that have use taxes on the ballot on April 5: Chesterfield and Town & Country. These two cities are using tax dollars to expend money to promote passing use taxes. They have information on their websites now and it appears more is coming between now and the election. We are hoping to learn about the process to determine the validity of the cities’ expenditures in favor of providing neutral information about the use tax. Chesterfield and Town & Country are certainly not the only two cities doing this.

For the record, there are arguments in favor of use taxes. You can also make the case that, absent alternate tax cuts, they are a tax increase. Either way, using public money under the pretense of “providing information only” has got to stop. Much more to come on this from Institute analysts in the coming days.

Major Confusion About Missouri’s EV Charging Station Bill

Posted on by Jakob Puckett

Judging by numerous articles I’ve seen recently, there is major confusion about House Bill (HB) 1584 that could use some clearing up.

HB 1584 stipulates that any municipality requiring property owners to install EV charging stations pay for those installation costs. Some municipalities in Missouri created requirements for property owners to build EV charging stations on new construction and major renovations—this law would ensure that private property owners aren’t forced to bear the costs of government-mandated construction.

Retrofitting an existing parking space with EV charger equipment can cost thousands of dollars per space, so sorting out who pays for what is not unreasonable. Despite what some opponents claim, this bill doesn’t “block” EV market growth; it simply ensures that private property owners aren’t told where and when to spend more money.

Another objection to this bill is related to costs. It costs much less to outfit a parking space with EV charger equipment during construction than after. Some estimates say installation during construction rather than after could cut costs by 75 percent. And with thousands more EVs hitting the road each year, opponents of the bill claim it would be better to require building charging stations as cheaply as possible to accommodate EV market growth.

This gets it backward. It may indeed be cheaper to install chargers during original construction, which is something property owners can take into account if they wish to respond to a growing EV market. Accommodating an emerging class of customers is standard business practice and doesn’t require any mandates.

Lost in the discussion surrounding HB 1584 are several better policies state and local policymakers can pursue to improve the EV market. For charging stations, municipalities can streamline their zoning rules to allow EV chargers in all zoning districts, review EV charger installation permits in days rather than weeks, and make information about the permitting process much more transparent. To make it easier to purchase EVs, state lawmakers can allow Missourians to buy EVs directly from manufacturers rather than forcing them to go through a franchised dealership (which many new EV companies do not have).

HB 1584 is a step in the right direction, but it’s a narrow bill that only deals with protecting private actors from an onerous government mandate for EV charging station construction. I’m hopeful that future EV policy discussions can turn from talks of fines and mandates to free markets.

Russia, Ukraine, and the Impact on The United States with Senator Jim Talent and James Jay Carafano

Posted on by Zach Lawhorn

On March 17, 2022 Senator Jim Talent and Heritage Foundation’s James Jay Carafano joined us for a virtual event to discuss the impact of the Russian invasion of Ukraine and what it means for The United States, China, and more.

Download the podcast version of the event:

Listen on Apple Podcasts 

Listen on Sticher 

Listen on SoundCloud

 

The Missouri House Has Taken a Stand for Parents

Posted on by Susan Pendergrass

It’s past time the Missouri Senate steps up to the plate and delivers for Missouri Parents. The House has done its part—two very important bills that support the rights of parents to choose how and where their children are educated have passed through House committees and a full House vote. They’re now in the hands of the Missouri Senate, which has been debating and arguing about education issues since early January, but not passing legislation for the governor to sign.

House Bill 1552 will finally fix the glitch in funding for public school students who choose a charter school rather than their assigned public school. Now known as the Charter School Funding Act, this bill would give charter school students access to the same funding streams as their non-charter school peers. In addition, it would send state aid to charter schools directly from the state, rather than routing the state money through the district in which a charter school is located. This funding change becomes critical when a district’s state aid amount is insufficient to cover the number of students in charter schools, as is currently the case in Kansas City. Charter schools can’t open or expand if the pot of money is limited. St. Louis is getting close to that point but isn’t quite there. The bill gives St. Louis Public Schools five years before the funding changes take effect.

House Bill 1814 would allow Missouri families to choose a school in a district other than the one in which they live. If a family owns property (such as a second home or a farm) in a separate school district from the one they reside in, the family can send up to four children to that district. More importantly, the bill also allows families to cross district lines for any reason, provided that the district they seek agrees to accept transfer students. Not only does this greatly expand options for Missouri students, but it also gives districts an incentive to work to attract students and their state aid dollars. Many states have similar policies and the data show that it is most often rural students that take advantage of such programs

Missouri families have had a rough couple of years. In person versus virtual, mask and vaccine requirements, curriculum content, to name just a few issues, have parents wanting more than just one assigned choice of school. It’s time for the Missouri Senate to follow in the House’s footsteps and put these options on the governor’s desk.

An In-depth Look at Missouri’s Rural High Schools

Posted on by Susan Pendergrass

In this report, Susan Pendergrass presents a detailed look at Missouri’s rural high schools, with information about student demographics along with key indicators like student/teacher ratios, teacher experience, and per-student expenditures. Perhaps most importantly, the report compares schools across several measures of academic performance broken down by subject matter, school locale, and income level of students. Click here to see the full report.

Find more on the performance of schools in Missouri at MoSchoolRankings.org

Watch: School Choice Mythbusting

Posted on by Zach Lawhorn

Have you ever wondered: Do the narratives continually pushed by defenders of the status quo in education actually hold up? Are they fact or just plain fiction? Is the proverbial sky falling in education as opponents would have us believe?

On March 9, 2022 EdChoice’s Jason Bedrick, Director of Policy, and Mike McShane, Director of National Research, joined us for a virtual event to challenge these narratives and share their published papers on two specific topics. Bedrick’s Who’s Afraid of School Choice? follows up on some of the dire predictions that school choice opponents have made over the years and sees how little they match reality. McShane’s The Accountability Myth attacks head-on the argument that public schools are accountable while private schools are not.

Should Building Codes Be Unified in St. Louis County?

Posted on by David Stokes

A group of home construction, realtor, and trade groups has launched an effort to consolidate the various building codes within St. Louis County. There are good arguments in favor of this effort, as well as legitimate concerns that need to be considered.

The arguments in favor of this effort are clear to see. From the press release:

The study [a study issued last October by St. Louis REALTORS] found there are at least 42 building code books used across 89 jurisdictions in St. Louis County. Together, the codes that were counted had a whopping 809 chapters, totaling about 17,000 pages.

42 different codes governing the work of plumbers, electricians, contractors and other professions is a lot. A contractor can be working on projects in neighboring cities and have different codes to follow. Admittedly, those codes are usually very similar. But there are differences between codes, and those differences undoubtedly lead to confusion and higher costs in construction in St. Louis County.

While the benefits of this change are obvious, the concerns are more nuanced. Interest groups use codes to advance their goals, which in most cases is profitability and higher pay. Unions use codes to limit competition. Industries use codes to require people to use items that are profitable to sell. In 1999, the Pipefitters Union tried to dramatically tighten the St. Louis County mechanical code for the benefit of its members by excluding competing unions and non-union workers. It failed the first time but succeeded in 2010 at getting those laws changed. More recently, the sprinkler industry has unsuccessfully attempted to use codes to mandate sprinklers in new homes. There is now a ban on such a requirement in Missouri. A sprinkler requirement would be great for the sprinkler industry, but it would increase the price of new homes. These kinds of decisions should be up to the home buyer, not the sprinkler industry.

Those are just a few examples. My concern is not that we would have fewer codes in the county. Some type of simplification could be beneficial. My concern is that a comprehensive code system would be used by interest groups for their own benefit at the expense of taxpayers and consumers. It is easier for an industry to capture one code than many codes.

Hopefully, the beneficial aspects of this proposal can be accentuated, and the risks reduced, because there are parts of this proposal that are genuinely needed. If codes are consolidated in St. Louis County, it would be imperative to have the boards that oversee the codes represent the public and not interest groups.

A Problem LIHTC Won’t Fix

Posted on by Elias Tsapelas

A one-size-fits-all approach to public policy is rarely the best option. This is especially true when the topic is something as complicated as affordable housing. Recently, I wrote about the lack of sufficiently affordable housing in the St. Louis region and how it can be a difficult issue to solve. One thing I didn’t discuss is the lack of evidence suggesting that the low-income housing tax credit (LIHTC) could meaningfully improve the region’s housing affordability.

St. Louis has a very specific housing affordability problem. There are plenty of places to live, but there aren’t enough places with rents low enough to be affordable to those making less than 30% of the area’s median income (AMI). Affordable, per the report’s definition, also means only spending 30% of your income on housing. For St. Louis, a family of three making 30% of the area’s median income earns approximately $23,000 per year ($76,000 (the St. Louis AMI) X 30%). So, an affordable place to live for that family would be approximately $560 per month. ($23,000 X 30% (to find what yearly rent is considered affordable for them) / 12 (to convert to monthly rent).)

Despite being Missouri’s primary tool for addressing housing affordability, the LIHTC program is ill-suited to address the described housing affordability issue in St. Louis. The first and most obvious reason is that LIHTC is an already expensive way to subsidize the development of new housing

Another supposed benefit of LIHTC developments is that they come with rent controls. Remember, LIHTC developments, in exchange for ten generous years of tax subsidies, agree to set aside a portion of units for those with low incomes. The most common arrangement for LIHTC developments is for 40% of the units to be reserved for those earning below 60% of the AMI. But the rents for the LIHTC units are not based on the income of the potential residents; rents are set based on the income in the surrounding area (the AMI). Because of this, even LIHTC-subsidized housing would likely not be affordable enough for the family mentioned above.

To use some numbers to illustrate this example: As explained above, rent needs to be no more than 30% of your income to be considered affordable, and LIHTC units considered “affordable” can be reserved for those making 60% of the AMI. So rent for that “affordable” unit in a LIHTC development will be 18% of the AMI (30% x 60% of AMI). Based on the $73,000 AMI in St. Louis, this means that the monthly rent for a family of 3 in that LIHTC unit is about $1,100 per month ($73,000 x 18% / 12). But as was described above, a family of three in St. Louis making 30% of the AMI needs rent to be about $560 per month to be considered affordable—and the cost of the LIHTC unit is nearly double that figure. Because of this, LIHTC tends to offer little to no help to the poorest residents.

Housing policy is incredibly complicated, but it’s time to stop thinking of LIHTC as the answer to every problem. St. Louis may have an affordability problem, but LIHTC is clearly not the best solution.

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