Recently, Jefferson City’s City Council voted against raising fares on its public transportation system, Jefftran. The proposal would have increased full fare from $1 to $1.50. Jefferson City’s transit director lamented the decision, stating that the fare increase would have brought in an extra $30,000 to Jefftran. But in reality, if Jefftran is to become for financially stable, it should start by reexamining how it runs its buses. In 2013, Jefftran carried about 335,000 riders. However, Jefftran’s expenses were over $2 million in the same year. That means that for every for every person who stepped on board a city bus, Jefftran spent about $6 dollars. However, on average, each passenger paid only 60 cents per trip. Percentage wise, that’s a huge subsidy; a subsidy that is ultimately borne by local and national taxpayers. By raising fares 50 cents, revenue from riders would go from covering about 10% of operating costs to covering almost 12%. That’s more than a drop in the bucket, but not much more. Rather than aiming for a little extra money from fares, Jefftran could look into how its buses operate. Despite Jefftran’s extremely low fares (half the cost of riding a bus in Saint Louis), it has struggled to attract customers. In fact, ridership on the system is down more than 25% since 2008. 
Jefftran buses have low utilization for the service level they provide, and that utilization has decreased in recent years along with ridership. It’s clear that the service Jefftran offers is not serving the needs of residents, at least not in a way that is commensurate with the amount of resources the system requires. If Jefftran is truly to become an efficient transportation system, it needs to be prepared to ask tough questions about its operations. Questions like: What type of services do residents demand, and would be willing to pay for? Are traditional bus routes a cost-effective way of providing mobility in Jefferson City? Is Jefftran running the type of routes that maximizes ridership while keeping costs low? However Jefftran answers these questions, it seems clear that Jefftran has problems that will not be solved with a 50 cent fare increase.
Federal BRIDGE Act Could Help Fund Missouri Infrastructure Improvement
As we have written about many times before, Missouri continues to grapple with an impending funding shortfall for the Missouri Department of Transportation (MoDOT). At the same time, mirroring the failure of state policy makers, the federal government is facing a transportation funding crisis of its own. A new bi-partisan bill, the BRIDGE Act, may provide more federal support for Missouri infrastructure projects if the state can solve its own funding mess.
For some background, in recent years federal highway revenue has failed to keep pace with the federal government’s transportation spending. This has caused the federal highway trust fund, which takes in highway user fees and funds highway and transit projects across the country, to hemorrhage money. Only regular infusions of general revenue, to the tune of more than $55 billion in recent years, have kept the trust fund solvent. Missouri is heavily dependent on the highway trust fund to build highways and transit improvements, among other needs. Missouri has no backup plan if there are large federal funding cuts.
National leaders have suggested many ways of fixing the funding problem, including drastic spending cuts, raising the fuel tax, developing congestion taxes, introducing more tolling, cutting funding to transit, tapping repatriated tax dollars, and even eliminating the trust fund altogether. The BRIDGE Act side steps the ultimate fate of the highway trust fund, and instead will try to extend financing to important state projects outside the traditional funding system. The act proposes to set up an Infrastructure Financing Authority (IFA), which would finance up to 49% of large state and local infrastructure projects of “national importance.” The remaining 51% of project financing would need to come from local dedicated revenue streams. While the Authority would have $10 billion in seed money, the goal is self-sufficiency, with IFA charging state and local governments fees for loans.
While the BRIDGE Act is just the latest reform idea for federal infrastructure funding, it has significant bi-partisan support and does not entail increased taxes or spending cuts. If this proposal were to come into force, it could mean more financing for infrastructure projects across Missouri, but only if the state and local governments get their own funding sources in order. IFA would only loan money, which will have to be paid back, and local governments need to secure financing for the non-federal portion of the debt.
MoDOT could best use this act to alleviate its funding crisis by introducing tolling on major projects. That would create the revenue stream to apply for IFA support without raising taxes. Local governments could also fund necessary infrastructure projects, without raising taxes, by choosing projects where user fees could pay back IFA loans. And while the Bridge Act may or may not pass, getting transportation funding in Missouri on stable footing will pay dividends whatever happens at the federal level.
Father’s Day Thoughts On the Summer Solstice and the Minimum Wage
As first appearing in the Weekly Standard:
As this father’s day coincides with the summer solstice, it is an appropriate time to recall the astonishingly accurate calculation of the circumference of the Earth that was made on this same day more than 22 centuries ago by one of the founding fathers of mathematics and scientific measurement.
Like other Greek astronomers and scholars at the time, Eratosthenes (276-195 B.C.), the head of the famous Library at Alexandria in Ptolemaic Egypt, assumed the Earth was round and revolved around the Sun. From his research, he discovered a fascinating fact: Every year, at noon time on this day (June 21) and no other, the Sun shone directly to the bottom of a deep well in the town of Syene (site of today’s Aswan Dam).
Syene was almost due south of Alexandria, and Eratosthenes estimated distance between the two cities to be 5,014 stadia (or 800 kilometers).
When the Sun was at its zenith in Syene—shining directly down a well and reflecting back up again—Eratosthenes surmised that it must cast a tell-tale shadow in more northern Alexandria. Using the obelisk located in front of the library (or using some other tall, vertical object), he calculated the angle of the Sun to be 7.2 degrees south of its zenith in Alexandria.
Since 7.2 degrees is 7.2 / 360, or one fiftieth of a full circle, Eratosthenes reasoned that the circumference of the Earth must be 50 times the distance made by the curvature of the Earth between the two cities. That worked out to 252,000 stadia, which is within 1 percent of the modern measurement of 40,008 kilometers.
Just as the Sun cannot be directly overhead two distant cities at the same time, it is impossible to think that suddenly doubling the minimum wage in the cities of Saint Louis and Kansas City (with the mayors of both cities strongly supporting legislation to mandate a $15 an-an-hour minimum wage) will not cast a long and dark shadow over the prospects for future employment in those same core city areas.
The law of supply and demand is as immutable as rules of geometry and the law of gravity. If you make something more expensive, demand for it will decrease. That holds true for lemons, lightbulbs, and labor. By dictating businesses double the pay of the lowest-paid workers, cities that pass such laws are making it less attractive for businesses to hire or to continue to employ inexperienced and unskilled workers.
Here are three entirely predictable consequences of artificially setting the price of low-skilled labor far above the market price. First, it will make sense to substitute capital for labor through increased automation. Second, it will depress earnings and cause businesses to raise prices or cut corners in striving to deliver the best value to their customers. Third, many businesses will consider moving to other locations—with ample opportunity for doing so in surrounding suburbs.
Summer solstice comes but once a year. Doubling the minimum wage would damage job growth in Saint Louis and Kansas City every day of every year. It’s a matter of simple math and logic.
We Didn’t Lose the GOP Convention Because of Hotel Rooms
The 2016 Republican Convention will be hosted in Cleveland. Kansas City was considered but not chosen. Kansas City leaders want you to believe it is because Kansas City does not have enough convention hotel rooms. This claim does not stand up to scrutiny. According to Derek Klaus of VisitKC.com, the Smith Travel Report’s (STR) numbers for April 2015 assess Kansas City with 290 hotel properties and 31,970 rooms. In downtown Kansas City, STR counts 15 properties with 3,993 rooms. According to a November 2014 piece in the Cleveland Plain Dealer,
The Cleveland metro area – roughly defined by STR, a hospitality research firm, as Cuyahoga, Lorain, Lake, Geauga, Medina and Ashtabula counties – is home to nearly 22,000 hotel rooms, up about 4 percent from two years ago. In downtown Cleveland, the increase in room inventory is even more dramatic: up 16 percent since late 2012, to 3,945 rooms, according to STR.
Cleveland, which is considered a lower-tier market for conventions than Kansas City, has the same number of rooms in the downtown area. The Kansas City region has many more hotel rooms than Cleveland. Cleveland won the GOP convention likely due to other important political considerations that have nothing to do with the specifics of convention bids, including hotel room count. Keep this in mind next time you hear someone claim that Kansas City needs to spend tens of millions of dollars on a convention hotel.
The News Tribune Gets School Choice Wrong
The Jefferson City News Tribune’s editorial board published an article yesterday called, “Changes in Public Education Complicate Pressing Choices.” They wrote, “We don’t mean to be alarmist, but change that is too much, too soon could dilute funding and resources now directed to public education.” The truth is, Missouri could not embrace change soon enough.
The first modern voucher program was created in Wisconsin in 1989. Today, there are 24 different voucher programs.
Tax credit scholarships for private schools were first established by the Arizona Legislature in 1997. Now, there are 20 programs.
Arizona also established the first Education Savings Account (ESA) program in 2011. Now, five states have an ESA program, with Nevada recently passing the largest school choice bill to date.
Missouri has none of these programs. We’re even behind when it comes to public school choice. Charter schools were first established in 1992 in Minnesota. In 1998, Missouri became the 27th state to adopt charter schools. More than 15 years later, we’re still debating whether they should be able to operate outside of Saint Louis and Kansas City.
Technically, Missouri has only two forms of school choice: charter schools and interdistrict choice through city desegregation laws or district accreditation status. Even these programs have restrictive components, such as who is allowed to participate and where.
The News Tribune said, “Other options are gaining momentum, including education savings accounts, virtual schools and year-round schools.” They are right, school choice programs are “gaining momentum” in other states. In Missouri, they are not gaining momentum fast enough.
Missouri has yet to adopt even one of the available private school choice programs. An ESA bill received a hearing for the first time late this past legislative session.
The News Tribune wrote, “Parents tend to be more concerned about the specific quality of their children’s education than they are about public education in general.” Well, the editorial board did an excellent job of not being alarmist. It doesn’t alarm me at all that parents want what’s best for their kids.
What’s alarming is that the News Tribune seems to be more concerned about the public education system rather than whether or not all students receive a quality education within that system.
They questioned “whether changes—driven by technology, parents and advocates of student-centered learning—will outpace public education’s ability to adapt.” The answer is no, changes to the system will not outpace public education’s ability to adapt, because any time a parent is able to direct tax dollars toward a service that fits their child’s needs, that’s public education.
Minimum Wage Bills Under Consideration
The debate over increasing the minimum wage has been a hot topic recently. Below are the two minimum wage bills under consideration by the Kansas City City Council and the Saint Louis City Council.
Also below is a bill recently passed by the state legislature that would prohibit political subdivisions (cities, counties, and such) from raising the minimum wage above that set by state or federal law.
Corinthian College Crisis
At its peak Corinthian Colleges had over 100 colleges throughout the United States and Canada, including Everest College campuses in Earth City, Kansas City, and Springfield. Last month Corinthian Colleges, Inc., a large for-profit post-secondary education company, announced it would cease operations in all remaining U.S. locations effective April 27, 2015. The closure of Corinthian has left 16,000 students in quite the predicament. Many have taken on burdensome student loans, and now their school is closed.
In response, the Department of Education (DOE) announced a plan to wipe the debt slate clean for all students that attended these schools, a move that potentially could cost taxpayers $3.6 billion. Secretary of Education Arne Duncan defended the plan saying, “You’d have to be made of stone not to feel for these students.”
While I agree wholeheartedly that it is more than a minor inconvenience to have your school close, this is the wrong course of action. Indeed, this plan is wrongheaded and will simply encourage more of the behavior that created this crisis in the first place.
First, there is no need to forgive loans for courses students have already completed. They did not spend their time at Corinthian schools in vain. These students are still eligible to transfer their credits to other schools and continue their educations. Countless universities have made it clear that they want to help and are willing to open their arms to students who take the initiative to transfer credits and continue their pathway toward a better life. Long Beach City College President Eloy Oakley summed it up perfectly back in April: “They have options and no matter what, at the end of the day, we want them to finish their education, stay in the community and become economic assets to the community.”
Unfortunately, one of the catches of the DOE’s plan is that closed-school debt relief is only available to students who have not transferred their credits to another university. This bailout encourages students to throw away the years they have dedicated to attaining a degree and bettering themselves.
Second, this is potentially the largest debt relief program the government has ever offered students, and it sets a bad precedent. Taxpayers should not be held accountable for the billions of dollars students borrow in full knowledge of the consequences. Most of these students never would have attended a Corinthian College if it were not for the government’s subsidization of college loans. This bailout essentially means students bear no risk when making college selections; they can easily obtain college loans, and the government will forgive them if things go badly.
The students of the now-defunct Corinthian Colleges certainly got a raw deal, but that is no reason to enact measures that will encourage the same type of behavior in the future.
Combating the Summer Slide-A Community Effort
When I asked students at Confluence Academy, a charter school in Saint Louis City, the age-old question, “What are you doing this summer?” most responded with, “Chillin’.”
On the makeshift survey I had passed out to students on the last day of school, they scribbled answers such as “nothing” or “hanging out” in the blank spaces. Where I had asked, “How many hours do you plan to read this summer?” most didn’t bother, not even to write a zero. One student read the question out loud and laughed to herself. Another crinkled the paper into a ball.
“We’re in the neighborhood. We’re seeing them out unsupervised, not really having a whole lot to do,” said Beyond School Director Erin Malone.
Beyond School is one division of Mission: St. Louis, a local nonprofit in the Grove neighborhood. The organization provides fourth to eighth graders with year-round expanded learning opportunities, one of which is an eight-week summer program created to combat summer learning loss. Summer learning loss, or the “summer slide,” occurs when students from low-income communities experience little to no learning outside the academic year.
One study showed that more than half of the achievement gap between low-income and high-income students can be explained by unequal access to summer learning opportunities. Partnering with Adams Elementary, Beyond School provides low-income students with math and reading instruction, as well as access to activities such as cross-fit, improv, and musical lessons. In the fall, Beyond School will begin a new partnership with the charter school South City Prep.
While Mission: St. Louis does not charge Adams Elementary and South City Prep for its services, the partnerships serve as an example of how organizations in the public and private sector can work together to fulfill educational needs in a low-income community.
Rising seventh-grader Christian is one of 22 students currently benefiting from the summer program. I had the opportunity to listen to her read If I Grow Up, a story about the challenges a young man faces as he grows up in the projects.
“The first year I tested our students, every single one of them was behind,” said Malone, a former teacher and reading specialist. “The kids literally just need to read. They need to read books they can understand and that they can have conversations about. That’s kind of just what we do.”
On average, students gain about five months in reading proficiency during their time in the program. This means the student will advance more than 60 percent of a school year within eight weeks. Compared to no gain or sliding backward, this is quite an accomplishment.
College students, retired community members, and even off-duty teachers volunteer as tutors. “It’s a community mentality. It’s not their kids, but our kids,” said Malone, who hopes to eventually expand the program into other schools.
“If you really want to eradicate poverty, this is one of the ways,” she said.
What Should a Charter School Application Look Like?
In 2012, the Missouri Board of Education closed six Imagine charter schools. The Imagine network is one of the largest in the country, and at one point, it provided schooling for one-third of the charter school students in Saint Louis.
Closing these underperforming schools may not have been a bad thing, but it certainly put a bad taste in the mouths of those already fearful of the independent nature of charters. For some, Imagine’s failure justifies a long and arduous charter school application process.
While it’s true that some elements of charter school applications may keep out those who have no business educating children, a new study found that other requirements may simply create unnecessary barriers. In “The Paperwork Pile-Up: Measuring the Burden of Charter School Applications,” AEI’s Mike McShane (who will be joining the Show-Me Institute policy team in August), Jenn Hatfield, and Elizabeth English analyzed the sometimes-overwhelming elements of the charter school application process.
After coding requirements in applications from 40 charter authorizers, they found that authorizers could cut down the average application by at least one-third without interfering with their ability to ensure quality.
Charter school authorizers need to refocus their efforts on the regulations that are most likely to ensure quality schooling and do away with extraneous requirements that have piled up over time. Charter school applications can and should be streamlined to help authorizers focus on what they can do well and save applicants hundreds of hours of work.
In Missouri, both school districts and colleges can sponsor charters. Applicants must submit their application materials to the Department of Elementary and Secondary Education (DESE) by Oct. 1 prior to the fall opening of the school year. DESE provides a 40-page model application for sponsors based on statutory references. The application has a minimum of 23 educational, organizational, and business requirements.
“The Paperwork Pile-Up” lists common requirements for charter school applications, dividing them into three categories—green, yellow, and red. Here are a few examples from the DESE model application and statute requirements.
Green: Requirements are both appropriate and manageable.
- Present a compelling 1-2 sentence mission statement that defines the purpose of the school.
- Present proper documentation that the entity proposing to hold the charter is a Missouri nonprofit corporation.
Yellow: Requirements may be appropriate but onerous, or inappropriate but manageable.
- Annual calendar for the first year of operation.
- Include a sample lesson for a single core subject (of your choice), from two different grade levels that illustrate strategies for implementation of the curriculum consistent with the mission and education philosophy.
Red: Requirements are both inappropriate and onerous.
- Present a thorough, realistic, and cost-effective transportation plan; and provide specific evidence of third-party readiness and terms for providing transportation services consistent with the school’s budget assumptions. Third party must collect required information (include in application).
- A description of the charter school’s grievance procedure for parents or guardians. R.S. 160.405.1.(13)
Some burdensome requirements like those listed in the red category come from charter school authorizers, while others are codified into law. Both the Missouri Legislature and individual sponsors should review current requirements, focus on the necessary safeguards of quality, and eliminate regulations that make it impossible for Missouri charters to innovate and experiment.
To read more about cutting the red tape to unburden the charter school application process, click here.
