Watch: 2025 EdChoice Friedman Index Webinar

Posted on by Susan Pendergrass

On April 30, 2025, the Show-Me Institute hosted a webinar featuring EdChoice experts Ben Scafidi and Colyn Ritter, who presented findings from The 2025 EdChoice Friedman Index: All Students, All Options, All Dollars. This first-of-its-kind report measured private education choice across all 50 states. Inspired by the vision of Milton and Rose Friedman, the index evaluated how effectively states empower families to direct education funding toward the best options for their children—whether public or private. The event was moderated by Susan Pendergrass, director of research at the Show-Me Institute.

You can download the Friedman Index here.

A Bad Deal for Missouri’s Children

Posted on by Susan Pendergrass

A version of this commentary appeared in The Heartlander

Tradeoffs and give-and-take are at the heart of politics. We’re told that the politicians who are willing to compromise are the ones who “get things done.” But not every tradeoff is worth it. Case in point: In the Missouri legislature, passage of a relatively weak open-enrollment measure has been discussed as a “both/and” that could be tied to passage of another bill that strips the State Board of Education (BOE) of its authority to accredit (or refuse to accredit) Missouri’s public schools. If that’s the offer, it deserves a hard no from legislators.

I don’t often find myself defending the BOE, and for good reason. It is fair to wonder what a school district has to do in this state to lose accreditation. Out of 517 districts, 511 (98.8 percent) are fully accredited, six are provisionally accredited, and none are unaccredited. The Ferguson-Florissant school district is fully accredited despite the fact that only 20 percent of its students are proficient in English language arts, and just 16 percent are proficient in math. Hazelwood, another fully accredited district, shows similarly troubling numbers: 25 percent proficiency in English and 15 percent in math. The Clarkton C-4 district in Missouri’s Bootheel is fully accredited even though 85 percent of students scored below grade level in English/language arts or math last year. Sadly, these are just three examples among many.

The question is: if the BOE isn’t holding schools accountable, what should be done about it? According to the proponents of Senate Bill 360, the solution is to strip the BOE of the power it seems so reluctant to use. The bill would prohibit the BOE from using academic performance to classify schools for accreditation purposes. Districts would instead be allowed to hire outside accreditation agencies to evaluate them. It should be obvious that such agencies would have a strong incentive to tell the districts that hire them what they want to hear.

If the fates of these two bills are linked, what do Missourians get in exchange for essentially throwing in the towel on accountability for school districts? They get House Bill 711, which would allow for open enrollment . . . sort of. It would only let up to 5 percent of students transfer out of any district, and more importantly, it wouldn’t require districts to accept students who wanted to transfer in. Compared to what our neighbors in Kansas and Oklahoma have, this is entry-level open enrollment at best, and it isn’t worth letting the districts themselves decide whether or not they deserve to be accredited.

There is no law of nature stating that the BOE can’t hold districts accountable for student performance. The Missouri Legislature could also make the BOE do its job. In fact, we are about to have four new members of the 8-person BOE, and they are likely to bring fresh energy and commitment to accountability.

The research on high accountability and improved student outcomes is clear, so the rubber-stamping of school accreditation needs to stop. The state, which funds public education to the tune of $6.6 billion each year, has a responsibility to both students and taxpayers to make sure that money is being spent to prepare students for college or the workforce.

If a “compromise” is on offer here it is a troubling example of the misplaced priorities of Missouri’s educational establishment. Who are they protecting here—students trapped in failing schools, or school districts threatened by the prospect of being held responsible for their performance?

Free Buses, Costly Lessons

Posted on by Scott Tanner

A recent paper arguing for fare-free buses in New York City reads like something we’ve already tried—and failed at—in Kansas City.

In 2020, Kansas City became the first major U.S. city to eliminate bus fares entirely. At the time, city leaders leaned on a slapdash four-page “mini report” that promised an $11 million local GDP boost. To put it mildly, it was wrong.

Since then, ridership dropped, assaults on drivers went up, and the Kansas City Area Transportation Authority (KCATA) is now staring down a $10 million budget gap. The COVID money that kept KCATA afloat runs out next year. KCATA’s new leadership is asking to study whether fares should return. That’s where we are now: back at the beginning, but with less credibility and fewer resources.

The New York proposal has the same weaknesses. The author estimates a 23% increase in ridership, a 12% increase in speed and billions in economic gains—all for the low, low cost of $600 million in forgone fare revenue. But his math is speculative, his benefits are theoretical, and like in Kansas City, the costs are very real.

The problem isn’t just financial. Prices matter. Fares aren’t only about revenue—they’re also a tool to manage demand, discourage misuse, and incentivize better service. Eliminate them and you get overuse, fewer behavioral constraints, and more wear on already stretched systems. You also change the customer’s relationship with the service. When it’s free, expectations fall—for riders and for the agency.

Proponents talk about fairness. But there’s nothing fair about asking everyone to pay for a system that primarily serves a few. The better solution is targeted subsidies for those who need the help, which would preserve incentives, protect the system, and respect taxpayers.

Kansas City tried fare-free transit. It failed. New York doesn’t have to make the same mistake.

The Three-Legged Stool of Taxes with David Stokes

Posted on by David Stokes

Susan Pendergrass speaks with David Stokes, Director of Municipal Policy at the Show-Me Institute, about A Free-Market Guide for Missouri Cities, Towns, and Villages, Part Two: Taxation. They discuss Missouri’s over-reliance on sales taxes and harmful local income taxes, particularly in St. Louis and Kansas City. Stokes emphasizes the need for a “three-legged stool” approach to municipal funding, where sales taxes, property taxes, and user fees work together to create a more stable and sustainable financial system for Missouri’s municipalities.

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Timestamps

00:00 Introduction to Municipal Policy Expertise
02:52 Understanding Municipal Policy and Governance
06:12 Local Taxation: Sources and Implications
09:03 The Role of User Fees in Municipal Finance
12:10 Sales Tax Dynamics and Special Taxing Districts
14:47 The Impact of Tax Incentives on Local Development
17:54 Challenges of Property and Personal Property Taxes
20:58 Sales Tax Pooling: A Unique Approach
24:08 Conclusion and Future Directions in Municipal Policy

Produced by Show-Me Opportunity

Earmarks Come to St. Louis County

Posted on by Scott Tanner

The St. Louis County Council just passed a bill to give $3.2 million in tax money to privately owned farms in the county. The intent may be noble—addressing a perceived lack of options for healthy food in the northern part of the county—but the policy is bad and the precedent it could set is even worse.

Somebody much smarter than I am is going to have to explain to me how sending this money to a private entity does not violate this section of Missouri’s constitution:

No county, city or other political corporation or subdivision of the state shall be authorized to lend its credit or grant public money or property to any private individual, association or corporation . . .

Stick with me here. This is county tax money being granted to a private business. Unless words no longer have meaning, this move by the council is legally dubious at best.

There has long been a fight about earmarks in the federal government. With earmarks, members of Congress can simply request that funding be added in for projects they wish, outside of the standard merit-based or competitive funds allocation process. This money for farms in north St. Louis County is an earmark, for all intents and purposes. Yes, it went through the legislative process, but it has not been subject to any of the other rules for how local governments spend money, such as competitive bidding.

Turning St. Louis County’s annual budget of more than a billion dollars into a grab bag of pet projects is the last thing we need for local government in Missouri.  I hope the county executive vetoes this bill and I hope his veto is sustained.

SB 4: Missouri’s Energy Challenge and the Push for CWIP Reform

Posted on by Scott Tanner

Senate Bill 4 (SB 4) is a massive, 133-page omnibus bill that flew through the Missouri Legislature and has now been signed into law by the governor. One key policy SB 4 addresses is amending the Construction Works in Progress Law (CWIP), which was approved by voters in 1976.

SB 4 allows utilities to recover construction costs gradually during the construction phase, rather than waiting until the project is complete and operational. This will only be explicitly allowed for natural gas projects, although there is potentially a pathway available for nuclear and other resources through the Missouri Public Service Commission (MPSC). This alternative financing strategy should be useful for future capital-intensive projects, as it would reduce financial risk for utilities and possibly lower total project costs by allowing firms to rely more on revenue instead of loans, which accrue interest.

CWIP offers benefits for needed power plant construction, but the interest of ratepayers is still vital. A blank check for a monopoly utility could lead to cost overruns and cancellations (which are issues partly tied to the monopoly system itself).

Further Ratepayer Protections and Compensation

The MPSC will still oversee utility rates, and it should continue to weigh potential safeguards to protect Missouri ratepayers. SB 4 already includes two key provisions—cost caps (limited by the estimated cost and completion date) and a refund mechanism—if the plant is not put into operation.

The State of Virginia also recently passed CWIP reform, and it instituted additional safeguards that should be considered for future projects. These include:

  • A limit on the number of eligible projects;
  • Excluding 20% of development costs from early recovery;
  • Mandatory evaluation of federal funding opportunities from the Department of Energy; and
  • Establishing a cap on residential monthly bill increases ($1.40 per 1000 kWh).

Additionally, the MPSC should evaluate how ratepayers could be compensated appropriately for early contributions and their role in risk-sharing, such as treating CWIP financing more like a bond system.

This could involve limiting or disallowing pre-operation profits or aligning profits with the operation and provision of power. Another approach might be reducing total cost recovery for utilities after the plant is put into operation, since it is a riskier investment that relies on ratepayers earlier. Potential mechanisms include offering credits for reduced rates post-operation (that could function like a principal in a bond) or shortening the depreciation period post-operation to account for profits earned during the pre-operation phase. If this strategy leads to cost savings for a project, ratepayers should receive a portion of those savings.

These provisions could help strike a balance between protecting ratepayers and facilitating needed power plant construction. Utility companies argue that CWIP is required to build more energy generation in Missouri. If that’s the case, adequate safeguards for state ratepayers are needed.

A New Voice for Accountability, and School Choice in Missouri with Cory Koedel

Posted on by Susan Pendergrass

Dr. Cory Koedel, the Show-Me Institute’s new director of education policy, joins Susan Pendergrass to discuss the biggest challenges facing Missouri’s public education system. They cover declining student outcomes, the role of accountability and testing, and the promise of school choice. Koedel shares insights from his research on school funding models—highlighting Tennessee’s student-centered formula—and breaks down what Missouri can learn from states that are improving early literacy. They also examine controversial policies like early grade retention and open enrollment, and Koedel outlines his priorities for education research in Missouri.

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Timestamps:

00:00 Introduction to Education Policy Challenges in Missouri
03:10 The Role of School Choice in Improving Outcomes
05:48 Funding Formulas and Their Implications
08:52 Early Literacy and Reading Instruction
12:05 Retention Policies and Their Effectiveness
15:04 Open Enrollment and Its Impact on Rural Schools
17:58 Future Directions for Education Policy in Missouri

Produced by Show-Me Opportunity

The Honesty Gap in Education

Posted on by Scott Tanner

The education system often fails to communicate honestly with students, parents, and community members about how much students are actually learning. The discrepancy between actual student performance and what is reported is referred to as the “honesty gap.” A troubling example is the gap between students’ grades and their performance on standardized tests, which has grown tremendously since the pandemic. Grades are up, but test scores are down.

This is problematic because grades tend to carry more weight with students and parents than test scores. Many parents assume that the grades their children receive are accurate indicators of academic progress.

But this assumption is increasingly incorrect. Grades have become more and more disconnected from actual achievement. This may help explain why 90 percent of parents believe their children are performing at or above grade level in reading and math, even though only about one third of 4th- and 8th-grade students in the United States score at a proficient level on the National Assessment of Educational Progress (NAEP).

Who is to blame for the widening honesty gap? I believe we all bear responsibility. We seem to have collectively lost our appetite for bad news. Parents don’t want to hear that their children are falling behind, and schools are reluctant to deliver that message. Meanwhile, states face little pushback when they lower testing standards and inflate proficiency rates.

Unfortunately, the reality is that the cognitive skills students learn in school really matter for later-life success, and glossing over declining test scores—our best measures of these skills—will not change this fundamental fact. Sending our children to school and pretending that they are learning is not a path to prosperity. It is a path to lower economic growth and a lower quality of life. We should demand high standards from our educational institutions, even if the truth hurts.

Accountability in Missouri’s Public Schools

Posted on by Scott Tanner

Successful leaders know that while it might feel good to have “yes men” around, they are not the best people to help you make important decisions. Support and encouragement matter, but so does honest feedback. With that in mind, recent actions and proposals in Missouri raise the question: are the accountability measures in Missouri improving our schools?

Pushing Back Against Policies that Dilute Standards

Currently, Missouri students are categorized into one of four performance levels based on their state standardized test scores. From lowest to highest, these are: below basic, basic, proficient, and advanced.

HB 607 proposes the addition of a fifth performance category, called “grade level,” which would be above basic but below proficient.

  • Proficient: Demonstrates mastery over all appropriate grade-level standards
  • Grade level: Demonstrates mastery over appropriate grade-level subject matter
  • Basic: Demonstrates partial mastery of essential knowledge and skills for the grade level

This definition of “grade-level” implies that it should not be expected for Missouri students to have mastery over all appropriate grade-level standards.

Rather than diluting standards, Missouri should implement policies that make meaningful use of state assessments. One such example is a third-grade retention policy. The transition from third to fourth grade is pivotal—students shift from learning to read to reading to learn. To combat the well-documented fourth-grade reading slump, states such as South Carolina and Mississippi adopted mandatory retention policies paired with targeted phonics-based interventions. The result has been very positive.

Open Enrollment—Better Choice, Better Accountability

Currently, where you can attend school is largely determined by where you live. This prevents many families from changing schools. Establishing a cross-district, universal open enrollment program would allow more families to vote with their feet. Markets excel at revealing best practices, and districts with best practices will likely attract more students and pressure other districts to change.

There is some potential to align open enrollment with Missouri’s accreditation process. In December 2024, it was announced that for the 10th year in a row, the state’s accountability system would not be used for district accreditation. Perhaps there is fear of a trigger in the policy that would allow students to transfer out of unaccredited school districts, especially because the unaccredited districts must pay the tuition for the transfers to receiving districts. If universal open enrollment were adopted, lawmakers could revisit the tuition rule for transfer students out of those districts and implement a meaningful accreditation system.

These strategies offer ways to maintain high standards for our schools and children. Better accountability systems in education are the key to learning which strategies are working and which are not. Encouraging transparency and openness will generate more competition and innovation in our schools, and should ultimately strengthen our education system.

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