Page 152 – Show-Me Institute

New TIF is a Bad Deal for Boonville

Posted on March 5, 2021January 13, 2026 by David Stokes

A new tax-increment financing (TIF) package is being proposed to subsidize a new, 400-home development in Boonville. As best we can tell, there has only been one TIF previously in Boonville, and it was relatively small. So the people of Boonville may understandably have questions about TIF The pro-developer propaganda being promulgated about town by some doesn’t help clarify matters.

TIF, like other tax incentive and subsidy plans, is at its most basic point just corporate welfare. Why this development would deserve special tax breaks that other businesses, residents, and developments in Boonville don’t get is beyond us. But that is for the city council of Boonville to decide, not us.

Perhaps more importantly, TIF has failed throughout Missouri. Other parts of Missouri have used it extensively; it has not led to economic or population growth. You can’t spend yourself rich and you can’t subsidize your way to growth.

We will have much more to come on this over the next several weeks. For now, if you are interested in this issue, please check out just some of the substantial work we have done on TIF here at the Show-Me Institute:

Our study on whether TIF has worked for economic growth in Missouri (hint: it hasn’t).

Our essay on the connections between political donations and TIF awards.

Our testimony on the importance of TIF reform at the state level.

A commentary on the risk of TIF for Columbia.

Finally, a study on how exactly TIF works in Missouri and elsewhere.

What Would Daniel Boone (or His Sons) Think of TIF?

Posted on March 4, 2021January 13, 2026 by David Stokes

Therefore, we understand if many people in Boonville feel a bit like Daniel Boone himself when he said: “I have never been lost, but I will admit to being confused for several weeks.”

Our study on whether TIF has worked for economic growth in Missouri (hint: it hasn’t).

Our essay on the connections between political donations and TIF awards.

Our testimony on the importance of TIF reform at the state level.

A commentary on the risk of TIF for Columbia.

Finally, a study on how exactly TIF works in Missouri and elsewhere.

There is much more on our website about this issue, and much more to come from us over the next several weeks (during which I’m sure the developers will tell us we are just as confused as Daniel Boone.)

A New “License Compact”? Why?

Posted on March 2, 2021January 13, 2026 by Patrick Ishmael

Last year, the Missouri Legislature passed a watershed law that established one of the first true interstate license reciprocity reforms in the country. Missouri’s law recognizes out-of-state licenses for a host of jobs to make it easier not only for trained professionals to offer services in the state, but to ensure Missourians have a robust supply of workers to meet their needs. Now for most licensed professions, Missouri consumers have practical access to workers who could be licensed (and in good standing) in any of the 50 states, not just Missouri.

It’s why I don’t quite understand the logic of a handful of proposals being floated in the legislature this year that would adopt “compact” licensing legislation for doctors. A compact is an agreement between and among states that facilitates cooperation on a given issue and is often overseen by a third-party regulatory group. For instance, the Interstate Medical Licensure Compact (IMLC)—launched by the Federation of State Medical Boards to oversee interstate physician licensing—has been adopted in about half the states in the union.

If a state has no license reciprocity statute at all, it might make sense to join a compact. After all, access to two states’ resources is greater than access to one, and in the case of the IMLC, about half of the states is certainly greater than one state alone.

But if you’ve already opened the door to your residents accessing doctors from all FIFTY states, what incentive is there exactly for a state like Missouri to delegate any authority to an association of other states’ medical boards?

We touched on the idea of medical compacts in our 2016 paper on health care licensure reform “Demand Supply: Why Licensing Reform Matters to Improving American Health Care,” and we noted our concern about reinforcing a licensing system that is overly fixated on protecting the prerogatives of state-based medical boards. As Cato Institute adjunct scholar Shirley Svorny wrote about a similar proposal in Mississippi in 2016:

The [IMLC] compact may seem like a positive step to those who don’t have the time to look at it very closely. Surely, respected representatives of physician groups and the Federation of State Medical Boards will encourage Mississippi legislators to adopt the model legislation and join the compact. These groups are overselling the contribution the compact can make to improving access to telemedicine because they do not want federal licensing. (At the same time, the Mississippi State Board of Medical Licensure is seeking to squash private telemedicine providers, thus diminishing health care access even further.) [Emphasis mine]

Therein lies the issue. Compacts like the IMLC market that it makes it easier for doctors to go through the arduous process of licensing in multiple states, but the point of interstate license reciprocity is that it shouldn’t be an arduous process to begin with, and barely a “process” at all for doctors already licensed and in good standing in their home states. Throw in the self-interest of the Federation of State Medical Boards of establishing its own national umbrella organization to protect its turf from federal regulation, and you have all the reason in the world to question why Missouri would adopt the IMLC at all.

The future of licensure is fewer licenses, and to the extent a proposal works in the opposite direction and supports the status quo, policymakers and the public should be highly skeptical of whether such proposals are more useful to the public—or whether they’re more useful to the interest groups that would control the proposed system.

Tax Incentive Reform Getting a Fresh Look from Legislators, Too

Posted on March 1, 2021January 13, 2026 by Patrick Ishmael

My colleague David Stokes wrote recently in the The Star about Kansas City’s pivot toward local incentive reform, a move that the Institute has called for over a decade. Specifically, the city ordinance considered by the Kansas City Council:

. . . would tighten limits on the amount of tax subsidies included in the many types of economic development incentives used by Kansas City. The proposal would cap the maximum subsidy at 70 percent of the tax otherwise owed. This would guarantee that, at a minimum, the person or entity who received the incentive would pay at least 30 percent of their taxes

As David often reiterates, there are many reforms that cities across the state could and should implement to rein in their tax incentive programs, which divert money from critical public services. Indeed, tax incentives help to create the illusion that there “isn’t enough” tax revenue for government services, perversely (albeit quietly) acting as a pretense for even more tax incentives and, eventually, tax increases on the taxpayers left holding the bag.

Getting a handle on tax incentives is as much a good governance issue as it is a tax issue, and eventually Kansas City’s reforms will need to go further in limiting how tax incentives are used if city services are going to be provided reliably and equitably. With that in mind, like any journey, the journey toward tax incentive reform must start with a step, and this is as good a step as any with which to lead.

If we’re lucky, Kansas City won’t be taking that journey alone this year. Several Missouri legislators have already filed bills that would address issues in a variety of tax incentive programs, including state tax credits that, for decades, have drained state coffers to the tune of hundreds of millions of dollars annually. There’s also renewed interest in getting a handle on the statutory definition of “blight.” Liberal definitions of what falls under the definition of blight can open the door to millions of dollars of taxpayer support for private development projects. Suffice it to say, it’s madness to consider a gated parking lot in a ritzy part of town “blighted,” but that’s a common story in the tale of tax incentive excess across the state.

But unlike incentives, talk is cheap. While the appetite for tax incentive reform does seem to grow stronger every year, we have yet to see substantial reform at either the state or local levels of government. Here’s to hoping these proposals are just the appetizer for a much larger reform meal; taxpayers are certainly hungry for it.

How Transportation Public–Private Partnerships Can Benefit Missourians

Posted on February 26, 2021January 13, 2026 by Jakob Puckett

Interstate 70 and several important Missouri roads need to be replaced soon but the Missouri Department of Transportation claims it lacks the money to do so. Using public–private partnerships (P3s) to operate toll roads can help the state finance road repairs.

With fuel tax revenue in a years-long stagnation and transportation revenues uncertain in the COVID-19 work-from-home era, P3s can be useful for funding big transportation projects. P3s are arrangements between a government agency and a private company to partner on a project’s financing, construction, and operation, typically through a long-term agreement. A big advantage of P3s is that investors can finance large projects upfront, rather than waiting for state transportation budgets to get back to normal.

P3s have other benefits. Because a company is responsible for road maintenance for, say, 30 years, it has an incentive to minimize costs over the long run. In contrast, state governments often have an incentive to minimize initial payments or upfront costs in order to make tax hikes or bonds more politically palatable.

Many states have turned to P3s to finance and operate road infrastructure improvements.

Toll road P3s shift the risk of generating enough revenue from the state government to the private sector. Moreover, by relying on tolls rather than existing state revenue sources, toll road P3s open up a new funding stream for road improvements and maintenance. P3s enable the private sector to offer toll-financed solutions where there isn’t a tolling agency or the political will to establish one.

P3s also avoid adding new state debt or liabilities. The toll road company is on the hook for future maintenance obligations, and the state can terminate the contract if the company does not hold up its end of the bargain.

The benefits of using P3s for toll-financed road improvements should prompt Missouri policymakers to reexamine Missouri’s P3 laws. Currently, P3s can be used for a range of infrastructure projects, but not toll roads. Several bills have been introduced in recent years that would change this, but none have passed. Perhaps falling fuel tax revenues and uncertain transportation budgets will encourage policymakers to reconsider.

Local Government Transparency Bill Gets Resounding 149-2 Vote in the House

Posted on February 26, 2021January 13, 2026 by Patrick Ishmael

If local governments can take your money, they should tell you how they’re spending it. And if they can’t or won’t? Well, that’s a problem, and it looks like the legislature might agree—and in a big way.

In a near-unanimous vote, the Missouri House of Representatives passed legislation that would establish the Missouri Local Government Expenditure Database. The move rebuffed attempts by local officials to halt the bill’s progress and sends the proposal to the Senate. As the St. Louis Post-Dispatch describes it:

The legislation sponsored by House Speaker Pro Tem John Wiemann, R-O’Fallon, is designed to boost transparency in local government. It would allow municipalities to post the information voluntarily, but also would give residents the ability to petition for the creation of a local database if local leaders are reluctant to participate.

The proposal advanced to the Senate on a 149-2 vote. The measure mirrors a similar bill that won House approval last year, but was not taken up in the Senate during the pandemic-shortened 2020 session.

The proposal would establish the Missouri Local Government Expenditure Database, to be maintained by the Missouri Office of Administration. It would go into effect in 2023 and would include information about a municipality’s or county’s expenditures and the vendors to whom payments were made.

As major proponents of transparency initiatives like this, I am obviously elated at the progress the bill has made relatively early in the session, and while I wish it went further by making reporting mandatory for all local governments, it’s a step in the right direction. I’ll be watching this bill closely and will keep you posted on its progress.

Three Health Care Experts Reiterate Importance of Making COVID Reforms Permanent

Posted on February 26, 2021January 13, 2026 by Patrick Ishmael

One of the revelations of the coronavirus pandemic has been how important online town halls can be to the public interest, and on Thursday, the Show-Me Institute was pleased to have three national experts with us to share their knowledge about how health care has changed so far in this crisis, and where we should go from here.

The event couldn’t have come at a more pivotal time. Missouri, like many states, is looking seriously toward making permanent changes to our health care system in response to last year’s health crisis to ensure that health care is affordable and accessible, pandemic or not. Our guests Josh Archambault, Naomi Lopez and Rea Hederman talked about telehealth, scope of practice, and health insurance respectively, although we had the opportunity to pick their brains about other health care issues in the Q&A period that followed the talks.

The event was about an hour long, and we’re happy to share the video of this informative event below. Enjoy.

To-go Drink Legislation Speaks to Important Issue

Posted on February 24, 2021January 13, 2026 by Corianna Baier

Regulatory action that allows restaurants to serve to-go cocktails is one step closer to becoming permanent. While this is obviously a win for restaurants and takeout enthusiasts, it also speaks to a larger movement: the recognition and elimination of unnecessary regulations.

At the beginning of the COVID-19 pandemic, Missouri temporarily relaxed and waived hundreds of regulations to both ease the burden on businesses and allow for an effective pandemic response. This led to an important question: If these regulations are not necessary during trying times, are they necessary during normal times? Do doctors and advanced practice registered nurses really need to be within 75 miles of each other to collaborate? Is it really necessary for certain licensed professionals to receive their continuing education in person at specified locations as opposed to virtually?

Regulations burden businesses and make it harder for workers to get and keep jobs. Red tape hurts our economy and stifles growth, so if a regulation truly isn’t necessary, it should be eliminated.

I’ve previously called for these waivers to be made permanent and it’s good to see some progress during the legislative session. No matter how trivial it may seem to allow to-go cocktails, the larger issue of eliminating unnecessary regulations is a serious one. Other states have already taken steps to eliminate regulations and promote economic growth. This is a small step, but hopefully Missouri will continue to recognize and eliminate harmful regulations.

Tax Incentive Reforms Would Benefit Kansas City

Posted on February 23, 2021January 13, 2026 by David Stokes

A version of this commentary appeared in the Kansas City Star.

Ulysses S. Grant was known to say that in war, anything was better than inaction or indecision. Doing something was always necessary to make sure that the enemy was responding to you, not dictating to you. Even doing the wrong thing was preferable to inaction, as you could realize it was wrong, stop what you were doing, and do something else. General Grant may have saved our Union and helped free millions from bondage with those beliefs, but clearly he never served on a TIF commission.

That key part about realizing that what you are doing is not working and doing something else could be a vital lesson to the members of the various Kansas City tax incentive boards. Kansas City, like many other American urban areas, has been generously handing out tax incentives like candy on Halloween for decades now. These subsidies include tax-increment financing (TIF), enhanced enterprise zones (EEZ), subsidies offered through the Land Clearance for Redevelopment Authority (LCRA), and several property tax abatement programs authorized under Chapters 100 and 353 of Missouri law. Over the past decades, Kansas City has given out billions of dollars in total incentives to attract and retain business and development. In 2018 alone, the total tax abatements in Kansas City were worth $175 million in foregone taxes.

Do these incentives work? If by “work,” you mean giving economic development officials and politicians the appearance of “doing something” for the voters, then I guess they do work. But if you’re asking whether the incentives grow the economy in a way that both exceeds the cost of the incentives and extends beyond the growth that would have happened without them, the answer is decisively no.

In 2018 the Kansas City Council requested a study of the impacts of economic development programs such as the subsidies described above on Kansas City. The council wanted an independent, comprehensive review of the costs, benefits, and risks of the use of these subsidies. That is not what the council received. The report presented to the city council by the Council of Development Finance Agencies (CDFA) was biased propaganda with indefensible and wildly exaggerated claims of huge fiscal benefits from subsidies. The CDFA study stands in stark contrast with the overwhelming majority of economic studies about the benefits of local tax subsidy programs. The independent academic research into local economic tax subsidies has been consistent in finding that such programs produce either no benefit or very limited benefits that in no way justify the expenses.

Ordinance No. 200497, now before the city council, would tighten limits on the amount of tax subsidies included in the many types of economic development incentives used by Kansas City. The proposal would cap the maximum subsidy at 70 percent of the tax otherwise owed. This would guarantee that, at a minimum, the person or entity who received the incentive would pay at least 30 percent of their taxes. Maintaining a wide tax base to support public services is important in order to avoid high tax rates, and these reforms will help to accomplish that. The ordinance would guarantee that future economic growth would support local taxing districts with at least 30 percent of future tax revenues. This would lessen the consistent demand to increase taxes on the many people and businesses that do not have a tax subsidy. While these reforms would still allow for generous incentives and subsidies, the tighter limits on them would be a worthwhile change.

It is long past time for Kansas City to adopt significant revisions of the use of tax subsidies within the city. Tax subsidies such as those that would be limited by this ordinance do not grow the economy. Instead, they reduce the tax base and they favor politically connected entities over the majority of citizens. They are part of a failed race to the bottom. Ordinance 200497 would be beneficial to the overall Kansas City community. With it, the various boards that oversee tax subsidies could at least slow down the harm they are doing and start walking the right direction. Ulysses S. Grant would approve.

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