Extend Telemedicine Again

Posted on by Elias Tsapelas

Once again, action is needed to protect Missourians’ access to telemedicine. A little more than two months ago, I wrote about the good news when Governor Parson issued an executive order extending the regulatory waivers on various telemedicine restrictions that have been in place since the beginning of the COVID-19 pandemic. However, those waivers are set to expire at the end of the year, which is now rapidly approaching.

As I’ve written in the past, telemedicine has been an important part of Missouri’s response to COVID-19, and unfortunately, our state is still dealing with the coronavirus. Prior to the pandemic, state rules and regulations made accessing health care providers remotely more difficult than it needed to be. Telemedicine has become an increasingly popular option among providers and patients alike in the 21 months since these restrictions were lifted.

The growth of telemedicine over the past two years has been staggering. Recently, the chief medical information officer for BJC Medical Group testified in Jefferson City that more than 190,000 patients used its telemedicine services in 2020, up from only 4,000 in 2019. That’s a 4,750% increase in one year! Given telemedicine’s rapid growth, our elected officials need to ensure that access to these services can continue.

Of course, the best way to protect access to telemedicine would be for Missouri’s legislature to remove the currently waived regulations permanently. And as we head into the 2022 legislative session, I’m hopeful this will finally be the year our elected officials do just that. But until then, an executive order is the only way to preserve access to telemedicine.

Is SALT Really a Priority for Schools Right Now?

Posted on by Susan Pendergrass

With families enduring yet another chaotic school year of mask mandates, vaccination mandates, school closures, and shortages of substitute teachers and bus drivers, you would think that the teachers unions would be up to their eyeballs trying to figure out how to get things back on track. Nevertheless, the president of the American Federation of Teachers found the time to join a protest on the steps of the U.S. Capitol. And what was the protest for? Why, to bring back the deductibility of state and local taxes on federal tax forms, of course.

The reason that the president of a teachers union is joining forces with the bipartisan SALT caucus is that taxpayers are more willing to raise state tax rates if they can at least deduct what they pay to the state from their federal taxes. If they can’t deduct state taxes, then they prefer to keep them at a minimum, thank you very much. Same goes for local property taxes. And why does the teachers union want higher state and local taxes? So that more resources can be directed at teacher pay and teacher pensions. The education establishment is taking time to throw support at having everyone pay more out of their pockets to support and grow the education establishment.

Teacher pay, teacher recruitment, and teacher retention are also on the list of legislative priorities for the Missouri State Board of Education. The board would like to see legislatively mandated minimum starting salaries of $35,000 for teachers by 2024. In addition, $50 million in federal stimulus funds have been directed at recruitment and retention.

It’s true that having a high-quality teacher in every classroom is one of the few things that can have a positive impact on academic achievement. But do we get there by protesting for higher state taxes for everyone? Do we get there by paying every teacher more, regardless of their effectiveness? Do we get there by perpetuating a costly and outdated system of retirement that often pays teachers for more years of retirement than working years?

Stuck In the middle of all this are the 65 percent of Missouri students who were not at grade level on the state math assessment last year. Also in the middle are students with disabilities who did not receive any services when their schools shut down, along with the parents who desperately want tutoring for children who have fallen behind these last two years. It’s a sad state of affairs when public education starts to look like a battle between those who support teachers and those who support families.

Missouri’s Budget: A Primer (Update)

Posted on by Elias Tsapelas

Nearly three years ago, my essay “Missouri’s Budget: A Primer” was published. In the years since, a lot has changed in our state, including the size of the budget. Today, Missouri’s budget is the biggest it’s ever been, and is more than $3.6 billion larger than it was in 2019. With billions in federal aid sent to our state over the past year and billions more on the way, understanding the process for how our elected officials choose to spend state tax dollars is more important than ever, which is why I decided to update this primer.

Next month during his State of the State address, Governor Parson will lay out his budget recommendations for the 2023 fiscal year. In addition, there are supplemental funding requests for our current fiscal year that require immediate legislative attention. The Department of Elementary and Secondary Education has requested approximately $2 billion be appropriated from federal relief funds by April, Missouri’s Medicaid expansion population will run out of funding soon, and the governor has recommended a $15 minimum wage along with a 5.5% pay raise for state employees starting February 1st.

My updated report provides the context necessary to fully understand the tough task ahead for Missouri’s legislature. It also provides a step-by-step explanation of the state’ budgeting process, a graphic explaining the expected timeline for the budget, and a detailed description of many of the difficult decisions required to craft and maintain a constitutionally-required balanced budget. As lawmakers discuss the economic forecasts for the coming year and decide how much to raise future state spending obligations, this report should help provide some valuable insight.

Click here to read the full report.

Competition in Electricity Markets

Posted on by Jakob Puckett

Electricity is vital to all aspects of modern life, making it important that policymakers and citizens understand the laws and regulations governing it. This paper gives an overview of how electricity gets from a fuel source to your home and business, how electricity markets operate, and what policies different states have implemented to reduce electricity prices for their citizens. The report argues that Missouri lawmakers can lower electricity prices by embracing competition and allowing Missourians to choose from competing electric suppliers.

To read the full report, click here.

A Tax Cut is the Gift that Keeps on Giving

Posted on by Corianna Baier

At one time or another, I’m sure you’ve stressed about getting someone the perfect holiday gift. Everyone wants to get their loved ones something they’ll enjoy. And if lawmakers are looking for the perfect gift for their constituents, I can think of (at least) one thing that everyone would find extremely useful: an income tax cut. Stay with me here—this really is a great gift.

An income tax cut is basically the gift of money. Taxpayers would get to keep more of their hard-earned money to spend or save in any way that they want. That means more opportunities for taxpayers and more money that can be spent at Missouri businesses. And it’s the gift that keeps on giving, because you’d get this “extra” money year after year.

This would not only be an individual gift, but also a gift to Missouri’s economy. Income taxes are destructive to growth and disincentivize working. For a number of reasons, Missouri’s economy would be better off if the state relied more on other forms of taxation for revenue.

In recent years, Missouri lawmakers have taken steps to lower the individual income tax. The “Wayfair” bill in 2021, for example, added a reduction of the top income tax rate by 0.1 percent in 2024 and two triggers to eventually lower the top rate to 4.8 percent. But it’s not time to take our foot off the gas. Other states (like North Carolina) are implementing tax cuts, and Missouri should follow suit to support taxpayers and stay competitive.

In the mass of pre-filed bills, I know of at least one that would reduce the income tax, but it’s difficult to predict what will happen in Jefferson City in 2022. If lawmakers really want to give taxpayers a gift (albeit a late gift, given the timing of the legislative session), they’ll consider further income tax cuts this session.

Listen: Dr. Susan Pendergrass on The Missouri School Rankings Project

Posted on by Susan Pendergrass

Missouri schools are failing to teach the core subjects of reading and math, and the most recent test scores show that students are falling further behind. In response to the Missouri Department of Elementary and Secondary Education’s (DESE) failure to perform one of its most basic functions, the Show-Me Institute, in conjunction with Show-Me Opportunity, launched The Missouri School Rankings Project and MoSchoolRankings.org.

On November 18 in St. Louis, Missouri, Susan Pendergrass, director of research and education policy, presented her findings from the Missouri School Rankings Project and give an overview of how to use the website.

Listen to the full event:

Listen on Apple Podcasts 

Listen on Sticher 

Listen on SoundCloud

 

An Updated Look at Tax-Increment Financing

Posted on by Corianna Baier

Tax-increment financing (TIF) is a widely used economic development incentive in which property tax revenues are redistributed back to developers. Millions of tax dollars are diverted away from the state, cities, and other taxing districts each year. This report takes an updated look at the use of TIF in Missouri, with data from the 2020 Annual TIF Report produced by the Missouri Department of Revenue. Ultimately, TIF has many procedural problems and little proof of success. With millions of dollars on the line, it’s time for Missouri and its cities to rethink the use of TIF.

Click here to view the report.

Changes to Tax Incentives in the City of St. Louis?

Posted on by David Stokes

The Post-Dispatch ran a story recently about changes being made to how tax incentives are being awarded by the City of St. Louis. The new mayor had campaigned on making changes to the incentive game, and she has, to some extent, made good on her word.

From the story:

The city’s new mayor vetoed two developer tax breaks that she said were too generous. And then she held up final approval of incentive packages for two other projects that had long enjoyed almost unwavering political support — the City Foundry food hall complex and another phase of development in the Cortex tech district.

We have commended these changes to the old way of doing business. For too long, the city has pumped subsidies into the parts of the city that need them the least. So, points given for being more disciplined with the subsidies.

However, it seems that the quick and easy way for developers to get the subsidies they want is simply to make a “donation” to affordable housing. From the story (emphasis and note added):

Of the deals negotiated so far by the Jones administration, a theme has emerged: developers who want incentives are likely to be pushed to include a contribution to affordable housing.

  • The City Foundry deal required the developer to contribute $1.8 million to the city’s affordable housing trust fund, which helps finance affordable projects around the city. [Three other examples follow in the article.]

We love our subsidies in Missouri for affordable/low-income housing. At the state level, low-income housing tax credits have been abused for years. Now the city’s affordable housing trust fund is all the rage. But you know what? St. Louis (and Missouri) don’t have an affordable housing issue. In fact, a report just came out that says that St. Louis is the only metro area in the country where rents are declining. From the report:

There is one outlier among major American cities bucking this trend. Rents fell 4 percent in St. Louis, and it was the only metro to see a decrease in rent in October compared to a year earlier.

The low housing costs here are a result of many factors, both good (limited land-use regulations) and bad (high crime, etc.). But increasing the subsidies for affordable housing is the least of our region’s needs. And that, come to think of it, may be exactly the point. Solving crime in a high-crime area is very hard. Addressing housing costs in an area with low housing costs is, well, easy.

There are many good reasons for the City of St. Louis to substantially tighten up the tax subsidy process. Using it as a pressure point to get added “donations” to a fund that purports to solve the one problem the city doesn’t have is not one of them.

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