USDA Moves to Kansas City, Gets Incentives

Posted on by Patrick Tuohey

Alex Muresianu of Reason wrote recently about the USDA moving 550 positions from the Washington, D.C. area to the Kansas City area. This was a good move for the USDA because of the cost savings to the federal government:

The USDA’s cost-benefit analysis found that shifting these two agencies to Kansas City would reduce costs by 11.3 percent, saving taxpayers roughly $300 million (in nominal terms) over the next 15 years. These savings stem primarily from the fact that Kansas City has dramatically cheaper real estate than D.C., as well as marginally lower cost of living. The USDA’s report noted that the median sale price of a home (a major factor in determining cost of living for employees) in Kansas City is $205,400, compared to $420,000 in D.C.

This isn’t a surprise to me; I moved to Kansas City from Washington, D.C. in 2005. Nor should it surprise anyone who read our paper on the competitive advantages of the Kansas City region, as the paper mentions low cost of living as a major advantage for Kansas City.

While we don’t know exactly were in the region the USDA will locate, it was disheartening to read in The Kansas City Star that $26 million in “unspecified” incentives were part of the deal. The authors reported:

Greg LeRoy, executive director of the watchdog group Good Jobs First, accused the USDA of engaging in an Amazon-style selection process that made states compete for the jobs with incentives.

“It’s outrageous that the USDA would run an auction. This is the extreme version of privatized behavior by the federal government. Uncle Sam has no business running auctions, dangling jobs on state and local taxpayers,” he said.

LeRoy said the final competition the USDA is setting up between Kansas and Missouri is reminiscent of how corporations set municipalities against each other after a region has been selected.

“This is classic site location consultant chicanery…This is an ugly, extreme version of Uncle Sam imitating Jeff Bezos. Yuck. If I were a Missouri or Kansas taxpayer, I would never stand for this. And as a federal taxpayer I’m cross-eyed.”

It’s a shame that the USDA encourages such behavior. It’s a shame that the Kansas City region plays ball, and it’s a shame that we’ll now fight among ourselves for the specific USDA location.

I discussed this topic with Pete Mundo this morning on KCMO Talk Radio. Click here to listen to the segment.

Why Are Other Organizations Doing DESE’s Job?

Posted on by Susan Pendergrass

“Kind of crazy.” That’s how the director of school improvement for the Missouri Department of Elementary and Secondary Education (DESE) describes the Missouri accountability and reporting system for Missouri schools. And I don’t disagree. Navigating the DESE school report card website to figure out how a particular school is doing is challenging and kind of crazy.

It doesn’t have to be that way. The Data Quality Campaign gave our neighbor Illinois high marks for their school report card website. Their report cards are parent-friendly and go beyond the federal requirements for what must be included. The same analysis found that Missouri report cards have so much technical language that they are written at a 17th-grade level. That means you have to be a year or two into graduate school in order to fully understand them.

Fortunately, the St. Louis Post-Dispatch has built a website that is easily searchable with a nice display of information that may be of interest to parents and other stakeholders. Of course, the site only has information on the schools around St. Louis, not the whole state.

The St. Louis University School of Education has also launched the PRiME Center to provide education data to those who are interested in it. So far, they have built education profiles for St. Louis,  Kansas City, and the entire state. And here at the Show-Me Institute, we have been busy building datasets and analyzing Missouri education data so we can better understand how schools and districts actually perform.

According to Wikipedia, the purpose of a state education agency is to [be] “responsible for education, including providing information, resources, and technical assistance on educational matters to schools and residents.” So why are the media, universities, and non-profits doing the job that should be done by DESE?

We discussed this topic in a recent podcast. Listen here.

An IRC Bonus Pay Program Would Benefit the Ozarks

Posted on by Abigail Burrola

A survey released earlier this year suggests the Ozark region has a workforce problem. The survey asked businesses in the Ozark region questions about the state of the workforce in the area, and a majority indicated they have difficulty finding applicants with the relevant knowledge and skills to fill jobs. 

If employers are looking for a more skilled workforce, getting more students to earn industry-recognized credentials (IRCs) would be a step in the right direction. IRCs are credentials awarded from industry groups after passing an exam, allowing the bearer to demonstrate proficiency in a specific field. Earning an IRC is a great way to jump immediately from high school to a job.

85 percent of businesses responding to the workforce survey said they have some or considerable difficulty finding applicants with an IRC (only around a quarter of respondents said IRCs were not applicable). According to the survey respondents, IRCs are the most challenging type of educational attainment for employers to find in prospective employees, even including postsecondary degrees.

The variety of survey respondents is also notable. Responses came from a number of industries including healthcare, education, manufacturing, construction, and finance. This is good evidence that the problem of IRC scarcity is widespread and not just confined to pockets of the Ozark economy. The Missouri Department of Elementary and Secondary Education has approved 81 types of IRC exams; only 16 of those exams were completed successfully by an Ozark student. In total, a mere 470 IRCs were awarded to high school students in the Ozark region in 2017. If each IRC was earned by a different student in the graduating class, then only 8 percent of Ozark graduates would have an IRC. The real number is likely even lower than 8 percent, because one student can earn multiple IRCs.

The survey responses make it clear that there’s unmet demand in the Ozark region for students graduating with an IRC in hand. One way to increase IRC attainment is to offer a financial incentive to schools and teachers. An IRC bonus pay program would give teachers financial compensation for each of their students that earn an IRC. Florida implemented an IRC bonus pay program and saw an explosion in students earning IRCs.

The Ozark region has a workforce problem that IRCs could help solve. It’s time to get creative in finding ways to prepare students for life after high school.

 

Subsidies Still Don’t Grow the Economy

Posted on by Show-Me Institute Staff

Kansas City has been spending loads of money on economic development subisides for years. But instead of actually spurring economic development, these subsidies often just move economic activity from one place to another, as Patrick Tuohey mentioned in this post from two years ago:

https://showmeinstitute.org/blog/subsidies/kansas-city%E2%80%99s-economic-diversion

Patrick mentioned this idea again in our latest podcast with Dr. Susan Pendergrass. They discussed Patrick’s latest report on Kansas City’s flawed 2018 economic development study. You can find a link to the study (with supporting documentation) and the podcast below:

https://soundcloud.com/show-me-institute/smi-pod-designed-to-be-worthless-the-incentive-study-that-wasnt

https://showmeinstitute.org/publication/subsidies/kansas-citys-2018-study-economic-development-incentives

School Choice Legislation and “The Valley of Death”

Posted on by James V. Shuls

Half a league, half a league,

Half a league onward,

All in the valley of Death

Rode the six hundred.

“Forward, the Light Brigade!

Charge for the guns!” he said.

Into the valley of Death

Rode the six hundred.

From “The Charge of the Light Brigade” by Alfred, Lord Tennyson.

On a warm evening at the end of May, I sat in a cramped office in an industrial park. It was after work hours, so there wasn’t much commotion at the truck rental or plumbing supply businesses located across the street. The building was not much to look at, but what was going on inside was priceless.

The room was packed full of parents and school children who were itching to get out of the uniforms they had been wearing all day. We were gathered that evening for our school’s “spring sharing,” where students display their artwork and offer recitations. Hearing my four-year-old and six-year-old recite poetry from memory filled my heart. But nothing could top my feeling of pride when my 13-year-old took the floor with his classmates.

They began with the “St. Crispin’s Day Speech” from Shakespeare’s Henry V. That speech has long been one of my favorites. Next, in a choral performance, the students recited “The Charge of the Light Brigade,” by Alfred, Lord Tennyson. The poem depicts a military blunder from the Crimean War, a battle few today know anything about. There was my son, reciting every word.

Weeks earlier, my three boys and I went on a school trip to Kansas City. While visiting the World War I museum, we stood on the glass walkway above the 9,000 poppies, each representing 1,000 military personnel who died in the war. The children, led by their teachers, joined together in reciting “In Flanders Fields” by John McCrae.

Some may ask, “What’s the benefit of having children memorize poems and speeches such as these?” Anyone who heard the voices of 30 children honoring the fallen soldiers understands the importance.

At our kid’s previous school, they attempted to teach kids character skills directly. Our first grader once brought home a coloring sheet with a superhero wearing a cape emblazoned with the word “Yet!” They were trying to teach perseverance and grit.

While these are wonderful traits to teach to children, we learn much more from the lessons of history, from the beauty of poetry, and from the trials of those who have gone before us than we will ever learn from a coloring page. Our new school is exactly what my wife and I had been looking for. To us, this is what education should be.

Few, however, will get to experience this type of education in our state—our school is a private school.

Indeed, many in the public education lobby have been patting themselves on the back for preventing school choice policies from passing this past legislative session. Charter school expansion never received a vote, and Empowerment Scholarship Accounts legislation was filibustered on the Senate floor.

It’s sad that people are excited about denying parents a chance to find a school that is the perfect fit for their family.

It still isn’t clear today who was responsible for the failure in the charge of light brigade—it seems that miscommunication led 600 men into the valley of death. We have no doubt, however, who blocked school choice legislation in Missouri because they won’t stop applauding themselves.

Missouri Families Deserve Choice

Posted on by Susan Pendergrass

My son, I’m happy to say, is a well-adjusted adult who participates in plenty of active sports—mostly surfing and rock climbing. But, I clearly remember his time as a youth baseball player when he got the “Utility Player” award many years in a row. It wasn’t that fun for him and it wasn’t that fun for me. Maybe team sports just aren’t his thing.

Imagine the feeling of having your eleven-year-old son receive “The Most Annoying Male Award” from his teacher—who he spends 6 or 7 hours a day with for most of the year—knowing that his social skills are compromised by autism. My heart hurts for that child and his parents. I can’t imagine they’re excited about sending him back to that school in the fall.

This didn’t happen in Missouri; it happened in Gary, Indiana. I guess there’s some silver lining in that because almost half of the public school students in Gary have chosen a charter school. Hopefully his parents can find a better fit—a school that celebrates his strengths instead of making fun of him.

But what if this happened in Missouri? The parents’ choices would be to move, pay private school tuition, or to send their son back to the school that humiliated him. The Missouri legislature has consistently denied parents in the state any option other than their assigned public school. The Department of Elementary and Secondary Education (DESE) tries to reassure themselves and everyone else by claiming 99 percent of districts in the state are “fine.” But fine as defined by DESE is not the same as fine as defined by every parent. Shouldn’t there be options available for parents who want, or more importantly need them?

 

Another Year without Reform

Posted on by Elias Tsapelas

Missourians hoping for a reprieve from rising health care costs will have to wait at least another year. Once again, the legislature failed to pass any measures to rein in growing costs. The Trump administration has made it easier for states across the country to request waivers from Obamacare’s most costly mandates. However, instead of applying for waivers that could help reduce health care costs, the state’s policymakers decided to devote their time to doling out generous tax incentives for General Motors.

The cost of health care is hurting the state’s budget and Missourians’ pocketbooks. This year, Missouri passed the largest budget in the state’s history and Medicaid is a bigger portion of the budget than any other single item. Medicaid today consumes more of the budget than ever before, and shows no sign of slowing down. In fact, Missouri’s Medicaid enrollment today is less than it was in 2005, but the program costs nearly twice as much.

Premiums for private coverage also continue to rise, partly as a result of restrictions imposed by the Affordable Care Act. My colleagues have advocated for the expansion of short-term medical plans to help ease cost inflation. Short-term medical plans allow consumers to personalize their coverage without costly Obamacare restrictions, such as mandated maternity and mental health coverage. Bills that would expand short-term plans have received support in both chambers the past two years. Hopefully a bill expanding the availability of short-term plans will finally pass next year.

The lone bright spot in health care policy was the creation of the “Missouri Health Insurance Innovation Task Force.” When the task force meets later this year, they will “develop innovative ways to transform the health insurance marketplace” and request an innovation waiver from the federal government. I’ll be outlining some market-based reforms the task force should consider in a future blog post.

The work of this task force and the reforms they consider could bring substantial health care savings for Missourians. Sadly, the implementation of any reforms won’t be completed until at least next year.  It’s nice to have a glimmer of hope for the future, but that doesn’t make the present any less disappointing.

 

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