How to Fix the Evergreen Clause

Posted on by John Wright

I previously wrote about how less than 16 percent of home care workers were able to force the rest of the people involved in that program to accept representation from the Missouri Home Care Union. If you followed that issue I doubt you’ll be surprised to hear that when the union negotiated a contract with the state it made sure to include an evergreen clause in the deal. An evergreen clause makes a labor agreement, and all of the work rules and policies provided for in that agreement, unchangeable without the union’s consent.

evergreen2See for yourself:

This Agreement shall take effect upon signature of the Parties and shall run for a period of thirty (30) months. If a successor Agreement has not been reached upon the expiration of this Agreement, the Agreement will continue in effect until a successor Agreement is finalized.

This is how an evergreen clause works. The agreement has a term, in this case 30 months, but after that term is up, the policies set by the agreement remain in effect until both parties settle on a new agreement. In this way, a union that wins a contract with an evergreen clause gets veto power over any new policies proposed by government representatives or the people. This shift of power from democracy to union negotiations is the real danger.

Senate Bill 549 aims to correct this egregious practice by limiting government labor agreements to a term of two years. If it passes and the courts decide to apply it correctly, then it’ll be a big win for anyone interested in good, flexible, democratically accountable government.

Make Metro Sustainable, not House Poor

Posted on by Joseph Miller

Planners are pushing for a new multibillion-dollar North-South MetroLink line in Saint Louis. While light rail expansion would increase mobility in the city (unlike some other “transportation” modes), the high capital costs of expanded rail imperil Metro’s ability to provide flexible and effective transit over the long term.

Transit spending, and especially rail transit like MetroLink, skews toward capital-intensive projects that make agencies “house poor”—that is, even if an agency can get most of the start-up costs of a transit project paid out of federal funds, that agency still may not have much money to pay for a project’s predictable long-term costs. That’s relevant to Saint Louis, where about 30 percent of the region’s transit funding comes from federal grants that usually require the the expansion of transit service.

Local governments don’t usually take this longer view on transit proposals; instead, projects are sold to residents based on their immediate local cost, with little consideration to how the city or agency will pay for the system’s eventual maintenance and reconstruction. This gap in logic on the part of many planners is a very real concern for taxpayers and transit riders alike; Boston’s transit agency has essentially bankrupted itself through rail expansion, and Chicago will need $36 billion to repair its transit system in the next decade.

Saint Louis is hardly different. Its MetroLink rail system cost more than a billion dollars to build, but MetroLink costs more than $80 million to operate each year, just as it is. This revolving pricetag, paired with MetroLink’s paltry fare take of $20 million per year, helps to explain why Metro has never replaced a MetroLink car: the agency simply doesn’t have the money for it. Indeed, MetroLink’s 83 vehicles are now more than 15 years old, on average.  Even building a new station on the existing line had to be entirely funded by the federal government. Expanding the rail system—as Saint Louis planners want to do with the North-South MetroLink line—will only exacerbate the system’s substantial, and predictable, long-term liabilities without also solving the problem of reliably paying for either existing or proposed rail maintenance and improvement.

Saint Louis planners should take into account the full costs of the projects being proposed and look toward increasing efficiency. Yes, a new MetroLink line may be an exciting possibility for many Saint Louisans, but if the entire Metro system is to have solid financial footing in the future, superficially attractive prestige projects like the North-South MetroLink line may need to defer to practical, efficient, and effective improvements to the region’s bus system.

Bill Would Give Workers a Vote

Posted on by John Wright

Imagine you could vote for the president only one time, and then you were stuck with the results until he or she were impeached. This wouldn’t be very democratic would it? For many of our government employees, including teachers and firefighters, this is the sort of democracy used to determine whether workers are unionized.

I previously wrote about the government union transparency gap and a bill addressing it, but if you are a government worker subject to union representation, not knowing where your dues go is only part of the problem. In many cases, you also have very little say in who represents you, and you have no recourse to ensure that your voice is heard. That’s why we need reform that would give all unionized public employees the ability to vote in regular union elections.

voteConsider the example of personal care attendants enrolled in the state’s consumer-directed health care program. Attendants get paid out of a state-managed program to take care of home-bound Missourians. In 2009, the attendants had an election to determine whether they would all be represented by the Missouri Home Care Union, a joint local union affiliated with both AFSCME and SEIU.

Out of 13,151 eligible voters, only 2,085 voted for the union. According to the state board running these elections, 294 ballots were challenged and 1,405 voters voted against the election. The challenged ballots plus the number of votes against the union were not enough to affect the outcome of the election. So in a low-turnout election with hundreds of challenged ballots, less than 16 percent of personal care attendants were able to force union representation on every other person enrolled in this program.

You might think, “Well, that’s just democracy. If you don’t vote, you deserve the representation you’re given.” The problem is that after a one-time election there will not be another election unless workers organize and go through a notoriously difficult decertification process. Depending on how a union contract is written, the union may even sue workers for trying to decertify the union or supporting another union. There’s nothing democratic about voting for a representative once and then being stuck with the results indefinitely.

If public employees are going to be subject to union representation against their will, then they at least should get a regular vote so that they can hold their union accountable. The Missouri Legislature has a bill, SB 549, that would require these regular elections. Regular union elections could help ensure that public employees, like teachers, police, and firefighters, are only subject to unions that work for them.

Rams to Make Missouri Millions?

Posted on by Joseph Miller

At a meeting of the House Government Oversight and Accountability Committee, the Missouri economic development director argued that the state could make millions off building the Rams a new stadium to replace the Edward Jones Dome, on which the state still owes $60 million. Unfortunately, the director’s numbers do not stand up to close scrutiny.

The crux of his argument is that taxes on growing NFL salaries (starting at $10 million in 2017 and growing at 3 percent thereafter) would help raise about $300 million. However, if we assume that the total income taxes from the Rams is $10 million a year growing at a rate of 3 percent, the actual present value of 30 years of state income taxes would be less than $200 million, assuming the recently passed tax cuts take effect. Even if the economic development director’s number is accurate, $300 million is still less than the total public cost of the stadium plan ($405 million).

The economic development director likely meant that the state, as in just the political entity of the state of Missouri, could make millions on a new stadium. But only half of the cost is the state’s, with the other half coming from the Saint Louis area. Saint Louis City has an earnings tax, but, even accounting for that income tax, revenue is most likely to remain between $250 and $300 million, well under the public cost of the stadium.

Stating that the stadium plan would fall short of recovering tax subsidies and fail to promote economic growth is not an anti-Rams position, it is the opinion of most economists. As one researcher put it:

There are absolutely no publicly subsidized stadiums and arenas that generate enough direct or indirect tax increases to balance the initial (and ongoing) public outlay. . . . In fact, some research suggests that sports stadiums actually decrease economic activity and tax revenue in areas where they are built. . . . However, strategically placed stadiums and arenas can sometimes ride existing redevelopment trends, but they are never the cause of these trends.

The state of Missouri and the city of Saint Louis should be honest with residents. If we use public dollars to keep the Rams, it will be about pride, not tax revenue or development.

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