2018 Blueprint: Public Union Recertification

Posted on by Patrick Ishmael

THE PROBLEM: Once a government union comes to power, it can stay in power indefinitely. No further elections are scheduled and no term limits are imposed. This means workers can do little to ensure their union truly represents their interests and is held accountable.

THE SOLUTION: Regular public union recertification elections.

Regular public union elections would give workers the right to elect union representation to fixed terms. Regular elections would help keep union actions in line with worker interests and lead to competition among unions. It would also help prevent backlash from union leadership in response to decertification petitions.1

WHO ELSE DOES IT? Currently, Wisconsin and Iowa require regular public union elections.

THE OPPORTUNITY: The Commonwealth Foundation recently gave Missouri a letter grade of ‘D’ regarding its public labor laws. Show-Me Institute research indicates that regular union elections need not be prohibitively expensive and offer a way to ensure that unions serve workers—not the other way around.

KEY POINTS

  • Public workers in Missouri should have the right to choose who represents them.
  • Regular elections would make unions more accountable to those they represent, just as regular government elections pressure politicians to be accountable to voters.
  • Regular elections can be held at a reasonable cost to taxpayers.

SHOW-ME INSTITUTE RESOURCES

Policy Study: A Primer on Government Labor Relations in Missouri

Essay: The Low Cost of Labor Reform

 

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

2018 Blueprint: Right to Work

Posted on by Patrick Ishmael

THE PROBLEM: Until recently, many workers in Missouri could be forced to join unions. That was unfair not only to the employees affected by the law, but also to employers who had to operate under it.

THE SOLUTION: Right to work.

Right to work ends forced unionism and lets workers decide whether joining a union best serves their interests. This means that being a member of a union cannot be a requirement for employment, and gives employees the final decision about whether they want to give money to a union that may or may not have their best interests at heart.

In 2017, Missouri passed Right to Work, but in 2018, the state will hold a referendum on that law.

WHO ELSE DOES IT? Alabama, Arizona, Arkansas, Florida, Georgia, Guam, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Mississippi, Nebraska, Nevada, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, Wisconsin, and Wyoming.

THE OPPORTUNITY: If the state’s Right to Work law is put into full effect, Missouri will join the majority of American states that already have right to work laws, finally placing Missouri employers and employees on a level playing field with other states.

KEY POINTS

  • Missouri will be better able compete with neighboring right-to-work states in attracting businesses.
  • Existing unions will be more responsive to the concerns of members, thanks to the credible threat of members leaving the organization.
  • Employees will have greater control over their representation in negotiations with their employer.
  • Employers will have greater flexibility in managing their businesses and making their operations more successful.
  • Private employers are the focus, but similar laws in the public sector, like paycheck protection, should be pursued by policymakers as well.

SHOW-ME INSTITUTE RESOURCES

Policy Study: A Primer on Government Labor Relations in Missouri

Op-Ed: Rise of the Roosevelt Law: Is Reform in Government Unions Coming to Missouri?

 

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

2018 Blueprint: Special Taxing Districts

Posted on by Patrick Tuohey

THE PROBLEM: Special taxing districts (SDs) are political subdivisions of the State of Missouri that fund specific services and improvements, such as neighborhood security, fire protection, and various kinds of infrastructure. In theory, SDs can help deliver services to taxpayers efficiently and effectively. But in practice, certain SDs—particularly transportation development districts (TDDs) and community improvement districts (CIDs)—may create more problems than they solve.

First, these districts allow narrow special interests to tax the public for their own private gain. For example, a luxurious hotel in Kansas City instituted a CID in order to charge a 1 percent sales tax that it will use to refurbish rooms and replace carpeting.

Second, the districts are often drawn tightly around businesses, such as shopping malls, so that no local residents have to vote for the tax increase. The ability to draw district boundaries gives business owners a great deal of power to charge local taxes without public oversight. Without that oversight, SD boards can extend the length of their tax increases well past the initial project need.

Lastly, the Missouri State Auditor has pointed out that SDs are not transparent and that taxpayers are often not consulted in their creation and have no idea of their existence. For example, customers often choose hotels based on room rates, but rarely by tax rate—in fact, many customers do not even know they are paying these additional sales taxes.

The number of SDs is growing rapidly, and the combined impact of these small districts is adding to the tax burden of Missourians across the state.

THE SOLUTION: Stricter requirements for the creation of SDs and stronger reporting requirements to ensure accountability.

Reforms that will provide greater taxpayer protection include (1) requiring that a minimum number of residential voters live in districts; (2) requiring that the State Auditor or Director of Revenue compile an annual report that details statewide SD spending, revenue, and debt; (3) requiring all SDs sunset unless explicitly approved by district voters, and (4) requiring more transparent public bodies, such as city or county councils or commissions, approve all SD bids. To truly curb abuse, the sales taxing authority of SDs could be revoked so that only property tax revenue could support district projects.

THE OPPORTUNITY: Reforming these districts could increase transparency and provide protection for taxpayers. It would also result in lower taxes in Missouri’s largest markets by making sure that special taxing districts only act with the informed consent of voters.

KEY POINTS:

  • In 2014 and 2015 alone, TDDs in Missouri collected more than $176 million in tax revenue—yet only 6% of those TDDs had residents within their boundaries. According to the State Auditor’s report, $125 million of that revenue was collected without residential voter approval.
  • Of the 34 TDD audits the State Auditor’s office has completed over the past 10 years, one-third concluded the TDDs under consideration were in bad financial shape. And nearly all audits indicated other issues, ranging from conflicts of interest and uncompetitive bidding practices to a failure to comply with basic accounting standards.
  • Requiring SDs to demonstrate they are meeting their job creation and tax revenue goals would keep them accountable to taxpayers.
  • SD board members voting for and approving contracts for themselves is a potential conflict of interest. Requiring that contracts be put out for bid would ensure a competitive process.

SHOW-ME INSTITUTE RESOURCES

Missouri State Auditor’s Report: Transportation Development Districts (Report No. 2017-20)

Blog Post: Auditor’s Report Sheds Light on Special Taxing Districts

Blog Post: Missouri’s Troubling Sales Tax Mosaic

 

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

2018 Blueprint: Sentencing Reform

Posted on by Patrick Tuohey

THE PROBLEM: Prison costs in Missouri are rising, and the state’s crime and incarceration rates are higher than the national average. According to the National Institute of Corrections, “The crime rate in Missouri [2015] is about 18% higher than the national average rate.” Missouri imprisoned 530 people per 100,000 population in 2015—the eighth-highest incarceration rate in the nation. High crime and incarceration rates present a significant cost to taxpayers, and imprisoning minors is especially expensive. Recent federal law requires that prisons adopt important—and expensive—protections for minors, among them providing educational resources and separating them from the adult population.

THE SOLUTION: Relax harsh and automatic sentencing laws that drive up costs without increasing public safety.

Courts should have the flexibility to sentence nonviolent offenders to treatment programs or probationary periods prior to locking them up—while still retaining the ability to treat violent or habitual offenders appropriately.

The Raise the Age movement advocates for 17-year-olds to be prosecuted in the juvenile court system unless certified as adults due to the nature or severity of their crimes. Raise the Age would mitigate much of the need to retrofit adult prisons to protect minors, and would offer minors educational and rehabilitative services.

WHO ELSE DOES IT? Currently, 45 states do not presume that 17-year olds should be tried as adults. Nine of these states have passed Raise the Age laws since 2007.

THE OPPORTUNITY: In addition to the cost savings from having to house fewer inmates or not having to retrofit adult institutions for minors, there is the potential for a substantial benefit in human capital if nonviolent and drug offenders are sentenced to treatment or probation instead of being warehoused in state institutions with few opportunities for self-improvement.

KEY POINTS

  • Passing Raise the Age would not prevent judges from prosecuting 17-year-olds as adults if they were repeat offenders or if their crimes were especially serious.
  • Other states have cut incarceration rates responsibly, reducing costs and increasing public safety.

SHOW-ME INSTITUTE RESOURCES

Blog Post: “Criminal Justice Reform: Addressing the Costs of Incarceration”

Blog Post: “Criminal Justice Reform: Raising the Age”

Blog Post: “Criminal Justice Reform: Mandatory Minimums”

 

For a printable version of this article, click on the link below. You can also view the entire 2018 Missouri Blueprint online.

2018 Blueprint: Special Taxing Districts

Posted on by Patrick Tuohey

Special taxing districts are political subdivisions formed to fund specific services and improvements such as fire protection and infrastructure. In practice, however, they often allow narrow special interests to tax the public for their own private gain while allowing little or no public input or oversight. Learn more about reforming special taxing districts: https://showmeinstitute.org/blog/subsidies/2018-blueprint-special-taxing-districts

Hair Braiders Suffer Setback in Court

Posted on by Philip Oehlerking

Bad policies affect real people. Here in Missouri, African-style hair braiders Ndioba Niang and Tameka Stigers are fighting nonsensical regulations that keep them from earning a living. Unfortunately, they were dealt a blow when the United States 8th Circuit Court of Appeals found that the Missouri licensing requirements are not discriminatory and do not violate their rights. You can read the judge’s decision here.

In the past, we have written and talked many times about the excessive regulations that require practitioners of African-style hair braiding to go to a cosmetology school and undergo 1,500 hours of expensive education—almost none of which is related to their distinctive techniques—to get a license. However, because the state has an interest in public health and safety, the court found “the fit between the licensing requirement and the State’s interest is imperfect, but not unconstitutionally so.” In other words, these generalized regulations apply to all hair-care professionals and are not aimed specifically at the hair braiders; therefore, the regulation is not discriminatory. The hair braiders argue that their trade is distinctive and should not be lumped in with barber or cosmetology regulations. However, the court determined that African-style hair braiding “rationally” falls squarely within the Missouri’s definition of cosmetology (RSMO 3.29.010). So where do we go from here?

This issue could be put to rest by commonsense licensing reform. Missouri could simply exempt hair braiding from licensing or impose more narrowly drawn qualifications. Past efforts at reform have failed. Is this a case where special interests are just protecting their turf? 

Ndioba, Tameka, and other African-style hair braiders want to practice a profession for which they’re qualified and offer a service to customers. Why doesn’t government get out of their way?

The Show-Me State Charts a Course of Independence

Posted on by Patrick Tuohey

When it comes to state-level policy, research suggests that Missouri respects the rights and responsibilities of the individual. That is according to a new publication from the Mercatus Center at George Mason University which ranks Missouri 45th in its degree of political paternalism.

The authors describe the will to paternalism as

the belief that if left to their own accord, individuals have biases or tendencies that may lead them to make bad decisions in the absence of a governmental “nudge.”

The manifestations of these policies are familiar to all of us—sin taxes such as those on alcohol or tobacco, subsidies for recycling, and mandates on automobile/health insurance or retirement savings are a few examples. While well intended, these policies substitute government bureaucrat decision-making for individual decision-making in an effort to protect us from ourselves. (A reasonable person may ask why the “individual biases and tendencies” of a state employee are superior to the “individual biases and tendencies” of anyone else.)

To arrive at their conclusions, authors Russell S. Sobel and Joshua C. Hall awarded scores to states for a variety of policies, including:

  • Their reliance on selective sales taxes such as those placed on unhealthy foods and products.
  • Their propensity for subsidizing good behavior such as recycling or using energy efficient appliances.
  • Use of miscellaneous bans and regulations such as plastic bag bans, fireworks bans, or motorcycle helmet requirements.

When all states scores were tabulated, Missouri came out 6th least paternalist. That is good news. Kansas came out 4th and Illinois 44th. Perhaps not surprisingly, New York ranked the most paternalistic state and Wyoming the least.

This is not to say that the policies examined in the study are necessarily bad or undesirable, or that there aren’t other state regulations that significantly hamper innovation or create unnecessary burdens on business. Nor does it conclude anything about state spending. But Missouri’s rank suggests that relative to other states, Jefferson City is not inserting its own values into individual consumers’ transactions.

Lower Taxes, not Streetcars, Drive Development

Posted on by Patrick Tuohey

In a piece last month from KCUR titled Planned Streetcar Extension Spurs Redevelopment Of Midtown Kansas City Hotel, the author asserts that the streetcar drives development. The facts do not support the title or the lede.

The piece begins with the following claim:

The 11-story former Netherlands Hotel is slated to be redeveloped into 110 apartments, part of a Main Street development surge linked to the planned streetcar extension.

Linked? What does that mean? The article repeatedly asserts a causal link to the streetcar, even quoting Tom Gerend of the Kansas City Streetcar Authority as saying “the streetcar is an attractive catalyst for continued investment along the corridor.” Are developers buying up buildings along the streetcar route, investing their own money and contributing to the city and county tax rolls all because of the taxpayer funded streetcar? If so, that would be news!

It would be newsworthy because economic literature in the United States and around the world shows that it cannot be concluded that streetcars drive economic development. What actually happens here and elsewhere is that cities provide all sorts of taxpayer-funded subsidies along the route. What appears to be new economic activity is just redirected tax money.

In fact, the KCUR piece makes this very point:

Buland says Exact Partners already have purchased the six-story Monarch and expect to complete the purchase of the Netherlands this week.

The developer is seeking a 10-year, 75 percent property tax abatement from the city, and already has lined up historic tax credits to help finance the Netherland renovation.

While the developers may like the streetcar, how likely is it that they would be working on these buildings if there was no city tax abatement or state tax credit? In another story about the project in The Kansas City Business Journal, Buland says, “We look for challenging properties in that area that no one else wants to redevelop.” So much for a streetcar alone creating a clamor among developers!

The streetcar did not spur any redevelopment. The development at hand is due to lowered taxes. In short, Kansas City raised taxes to pay for the streetcar and then lowered taxes to spur development along the route. Imagine what would happen if we scrapped the streetcar and lowered taxes for everyone!

Taxing District Reform Testimony

Posted on by Patrick Tuohey

On Wednesday afternoon, the Show-Me Institute submitted testimony in support of HB 1234, which would reform how transportation development districts, or TDDs, are formed. Specifically, it requires that elections for TDD directors be conducted by the local election board, as opposed to being conducted via mail-in ballots overseen by the courts.

In this last streetcar election in Kansas City, residents who lived within the boundaries of the TDD were required to follow these steps in order to have their vote counted:

  • Obtain and complete the official ballot request form
  • Obtain proof of voter registration;
  • Return the ballot request and the proof of voter registration by May 23 at 5:00 p.m.

When the ballot itself was received,

  • The ballot had to be completed and placed inside a white envelope;
  • That white envelope had to be placed inside a blue envelope; and signed in the presence of a notary;
  • That blue envelope had to be received by the Court by 5:00 pm on August 1.

To put things in perspective, civil rights groups sued the state of Missouri simply for requiring photo identification to vote. But when the law required voters to request ballots, provide proof of registration and seek out a notary, those same groups were silent.

At least one Kansas City voter tried to play by these Byzantine rules and had his ballot discarded. According to KSHB, John Toms mailed in his ballot 5 days in advance only to have the court claim it wasn’t received on time. There was no USPS post-mark on the rejected envelope.

Multiply these burdens to voters by the 230 TDDs in Missouri that together collect an annual average of $50 million in sales taxes alone and it is clear that this is something that needs more stringent taxpayer oversight. HB 1234 is a move in the right direction.

Click below to read the entire testimony

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