Page 427 – Show-Me Institute

The Pension Problem Non-Teaching Personnel Pose

Posted on August 23, 2014January 13, 2026 by Michael Rathbone

In a recent post, Education Policy Research Assistant Brittany Wagner discussed a new study examining the large growth in non-teaching personnel in schools. The study found that over the past 60 years, schools have increased non-teaching personnel positions by 702 percent.

Besides their salaries, non-teaching personnel also accrue pension benefits through the Public Education Employee Retirement System of Missouri (PEERS). According to the PEERS annual report, “PEERS is a mandatory cost-sharing multiple employer retirement system for all public school district employees (except the school districts of St. Louis and Kansas City), employees of the Missouri Association of School Administrators, and community college employees (except St. Louis Community College).” Members of the plan and their employers both contribute to the pension.

Over the last five years, the unfunded liabilities (liabilities minus assets) of this plan have increased by more than $64 million. Pension benefits like PEERS benefits are guaranteed and must be paid out. If PEERS can’t make those payments, taxpayers (i.e., you) will have to.

One way to prevent a situation like the one described above is to shift these pension plans away from a defined benefit plan (PEERS) to more effectively structured plans like defined contribution plans, hybrid plans (a plan that is a mix of defined benefit and defined contribution), or cash balance plans.

Maybe the addition of new non-teaching hires over the past 60 years is justified, but maybe it isn’t. School districts are making the public pension bomb bigger, and if they aren’t going to defuse it, shouldn’t school districts at least give the taxpayers, who are ultimately on the hook if these pensions can’t make their payments, some evidence to support their increase in hiring?

The Future of Transit

Posted on August 22, 2014January 13, 2026 by Patrick Tuohey

My colleague Joe Miller just wrote a piece asking if Kansas City really needs rail transit at all, as many claim. His conclusion: It does not. Not only have rail transit options fared poorly at the polls, but they also are expensive and not a guarantee of improved development or transit.

Recently in San Antonio, voters were outraged over their city’s efforts to fund a streetcar without a public vote. As a result, the council is adopting a proposal that

“would amend the city charter so that no money could be spent on streetcar or light rail, nor would the city grant permission to use city streets for those kinds of rail projects, unless a majority of voters agrees to it.”

Opponents in San Antonio echo arguments elsewhere, that transit needs can be met much more efficiently through existing or new technologies such as rapid transit like the MAX bus or through driverless cars. Technology of Tomorrow shows a video summarizing their viewpoint. The video contains a segment of a TED talk by (speaking of creative class) Sebastian Thrun, director of the Artificial Intelligence Laboratory at Stanford University, in which he says [starts at 16:30],

“If you’re one of these people who argue the only way to solve the congestion problem is to move traffic off the road on to rail, think again. We have the space, we’re just not using it.”

[youtube http://www.youtube.com/watch?v=r_T-X4N7hVQ?rel=0]

The advent of driverless cars and their impact on urban transit is nothing new. We’ve written about their impending arrival in Kansas City, and we’ve lamented City Hall’s inability or unwillingness to prepare for it. It’s difficult to know exactly if or when driverless cars will be in every driveway and precisely what effect they will have on a traffic system. But if Kansas City wants to be the city of the future, it needs to prepare to quickly integrate all the opportunities the future presents, not protect the special interests of their cronies or rebuild the infrastructure of the past.

The problem in Kansas City is that government does not appear to respect the will of voters on this matter, unlike San Antonio. Despite tenuous claims of need, despite the cost, despite numerous ballot defeats, despite coming new technologies, City Hall can be expected to try again to come at voters with expensive rail proposals regardless of what better options new technology presents.

Delays and Blockades: Certificate of Need in Saint Louis

Posted on August 22, 2014January 13, 2026 by Christien West

Imagine you are eight years old, and you want to go into the business of selling lemonade. When walking around the neighborhood, you determine that all of the competitors are making sour lemonade, even though most people prefer sweet lemonade. Unfortunately, the neighborhood association denies your application for an operating permit to sell sweet lemonade—saying that there already are too many lemonade stands in the neighborhood.

It does not take a Ph.D. in economics to realize this is a foolish regulation. In the absence of proper competitive incentives, the other lemonade stands will continue serving sour lemonade.

Now replace the words “lemonade stand” with “three-bed hospital” and “your eight-year-old self” with “Paul McKee,” and you have a real-life situation.

McKee, a well-known real estate developer in the area, has been working on a project to renovate a portion of North Saint Louis City. On July 9, he unveiled a plan to establish a three-bed urgent care facility within the redevelopment area. According to state law, a certificate of need (CON) must be obtained in order to open a new hospital with costs of at least $1 million. It appears his proposal meets this threshold. However, requiring McKee to obtain a CON to open a small urgent care hospital in an underserved and impoverished area is a totally unnecessary government regulation.

CON programs initially were implemented in order to prevent the duplication of health services in a given geographic area, thereby controlling costs. The reasoning was that an excess supply of medical services would compel hospitals to increase prices in order to cover the high fixed costs associated with medical treatment.

There have been many different studies on how CON regulations impact the cost of care. A thorough survey of the relevant data reveals that CON regulations do very little, if anything, to control the overall cost of care. Furthermore, with respect to certain procedures, CON regulations have been shown to limit patient choice, resulting in worse care delivered from less capable doctors. Additionally, these regulations can create an inefficient market structure and grant existing hospitals monopolies over certain regions.

Some may even argue that McKee will attempt to use the regulatory program to prevent competitors from entering the market in North Saint Louis. Given CON rules, if his project is approved, it likely will be more difficult for new medical facilities to open nearby. But doesn’t the potential to abuse and use CON regulations to create a monopoly give all the more reason to eliminate them?

Additionally, Missouri’s CON program delays groundbreaking on new hospitals. McKee said he intends to submit his proposal by Aug. 22 and, in all likelihood, his application will not be reviewed until early November.

Christien West is an intern at the Show-Me Institute, which promotes market solutions for Missouri public policy.

Education: A Brief History Of Federal Overreach

Posted on August 22, 2014January 13, 2026 by Brittany Wagner

When Americans think of federal overreach in education, they might think of programs like Race to the Top, Common Core, or No Child Left Behind, but federal education interventions began long before the Age of Standardized Testing.

Fifty years ago this week, President Lyndon B. Johnson enacted a series of welfare programs called the War on Poverty. One of these programs was Head Start, a program aimed at preparing low-income children for kindergarten.

Also under the umbrella of the War on Poverty, the Elementary and Secondary Education Act (ESEA) was enacted in 1965. The purpose of ESEA was to start funding schools with federal money, but it forbade a national curriculum.

Under President Jimmy Carter’s administration, the Department of Education was founded in 1979. Just a few years later, in 1983, the American public was shocked by the findings of A Nation at Risk, a report issued by the National Commission on Excellence in Education during President Ronald Reagan’s presidency.

President George H. W. Bush and President Bill Clinton left their mark on standards-based education in the 1990s with America 2000 (Bush) and Goals 2000 (Clinton).

In 2001, President George W. Bush reauthorized the ESEA under a new name, No Child Left Behind (NCLB), and in 2011, the U.S. Department of Education began awarding states with flexibility waivers from NCLB if they did things like adopt Common Core or evaluate teachers based on student achievement.

In just 50 years, federal oversight in education has grown and evolved. On the anniversary of one of LBJ’s key initiatives, some are calling for even more government intervention to fix the inequalities that still plague the United States today.

But federal intervention will not solve Missouri’s education problems—just look at the results. Few would argue the education system in America is in good shape, or that every child is receiving a quality education. So why institute more government intervention?

If the past 50 years has taught us anything, it’s that Missouri needs to enter a new era of education reform, one in which choice and competition are embraced.

Show-Me Now! School Transfer

Posted on August 21, 2014January 13, 2026 by Brittany Wagner

Through a series of legal maneuvers, the Missouri Department of Elementary and Secondary Education (DESE) and the State Board of Education attempted to prevent students from transferring from Normandy Schools Collaborative. School choice and the school transfer law prevailed last Friday when Judge Michael Burton ruled in favor of transfer students. Since the transfer law was upheld for a few students, it should be upheld for all of them.

Privatization in Education-Not as Scary as Some Think

Posted on August 21, 2014January 13, 2026 by James V. Shuls

As first appearing in Education News:

In a classic episode of The Three Stooges, the phrase “Niagara Falls” triggered a visceral reaction from Moe and Larry, which ended with Curly getting punched, slapped, and thrown to the ground. I am often reminded of that episode when I talk to policymakers and public school officials about school choice. Like Moe and Larry, they seem to have their own trigger word—privatization.

Many reject outright the idea of allowing public dollars to follow a student to the school of his or her choice—including a private school. Never mind that there is a long history of individuals using public dollars at privately operated pre-schools and universities. When faced with this proposition for K-12 education, Missouri Gov. Jay Nixon (D) said that is where he draws the line. Missouri Rep. Jeff Grisamore (R–Lee’s Summit) echoed his sentiment: “Public schools should be publicly funded and private schools should be privately funded, period.” Like the reaction to Niagara Falls, these responses are almost comical.

They are laughable because public dollars already flow to private institutions. Examples abound. Nixa Public Schools outsourced maintenance to Sodexo based out of Paris, France. St. Louis Public Schools contract with First Student, “the largest bus company in North America,” for transportation services. More than 100 public school districts contract with Chesterfield, Mo.-based Opaa! to provide food service for public school students.

Every day, school districts rely on private, for-profit providers to deliver services and supplies. Some even contract with private schools to serve their most at-risk students. Yet, for some reason there is strenuous objection to private school choice programs that allow individuals to direct their education dollars to the school of their choice.

Opponents of school choice claim that private schools are unaccountable. That is, they do not have to teach the state’s academic standards, administer state standardized exams, or comply with a host of burdensome regulations.

This argument assumes that the only way to have accountability is through government regulations. That is not the case. Accountability simply looks different in a school choice system.

When parents choose a school for their child, they essentially are entering into a contract with the school for the education of their child. In the traditional system, parents have little recourse if the school fails to meet that obligation. They can meet with teachers, principals, and central office staff. They can even take their plight to the school board. At the end of the day, however, they have very little ability to hold the school accountable for meeting their needs. They are dependent upon the school for change.

In a school choice system, however, the dynamic is very different. In fact, the arrangement between parents and schools in a school choice system closely resembles the contracts between public schools and private service providers. If Opaa! fails to provide nutritious meals, they can be fired. Similarly, if a school fails to keep a child safe or does not live up to the expectations of the parents, the school can be fired.

Choice is a powerful accountability tool.

Opponents of school choice like to throw out the word privatization as if it was a bad thing. Yet, public schools contract with private providers in nearly every aspect of our K-12 education system.

If the goal is to provide a world-class education to students, policymakers need to avoid the knee-jerk reaction against school choice and recognize that the private sector can help deliver on the promise that every child should have access to great schools.

James V. Shuls, Ph.D., is the director of education policy at the Show-Me Institute, which promotes market solutions for Missouri public policy.

Does Kansas City Need Rail Transit?

Posted on August 20, 2014January 13, 2026 by Joseph Miller

After downtown voters rejected a taxing district for the expansion of Kansas City’s streetcar, rail proponents are looking for a “sellable” plan for streetcar expansion. To rail supporters, any future transit plan must include rail. As the Star put it:

“Good, smart transit—a mix of buses rails, and other people movers—is a vital component of any successful city.”

But does a city really need a streetcar, or for that matter any type of light rail, to be successful?

Certainly many cities in the United States, more than 50, have some form of fixed rail transit. The largest rail systems are the New York City Subway and the Chicago L, but many small cities like Kenosha, Wis., Little Rock, Ark., and Tucson, Ariz., also have light rail or streetcars. However, many cities, large and small, do not have rail transit. Cities like Honolulu, San Antonio, Orlando, Indianapolis, and Cincinnati have been popular cities to work and play in for many years without much or any fixed rail. These cities, and many others like Kansas City, rely on bus systems.

There’s no reason why Kansas City cannot continue to rely on buses. Whether it’s rapid transit or simply providing service to wide areas, buses are capable of meeting cities’ needs in most situations. For example, the Chicago Transit Authority’s bus system had more than 314 million boardings in 2012. KCATA only had around 16 million boardings that year. The limits of KCATA’s bus system is yet to be reached.

While rail systems may be necessary in cities with significant congestion and population densities, nowhere does Kansas City have population or traffic to make rail necessary. And while it is not necessary, rail has its drawbacks, paramount of which is cost. For instance, Kansas City’s proposed streetcar expansion (less than 10 miles of routes) costs were more than double the entire capital spending on KCATA’s 250-plus bus fleet from 1992 to 2002.

Rail supporters contend that rail transit creates development, drives density, and is necessary to make Kansas City an attractive city for people to live in. But much of that belief is based on anecdotal evidence from successful cities with rail, usually ignoring places where rail has failed to drive development. Cities like Cleveland, Detroit, Baltimore, Buffalo, and Saint Louis have seen little regeneration from their rail lines, some of which cost more than a billion dollars.

Kansas City needs efficient transit that serves the community. It does not need rail to be successful, and residents should not let city officials with status anxiety waste hundreds of millions just to say Kansas City has rail.

Normandy Transfer: An Evolving Story

Posted on August 20, 2014January 13, 2026 by Brittany Wagner

After Friday’s decision by Judge Michael Burton that Francis Howell, Ritenour, and Pattonville School Districts would have to accept Normandy transfer students, Normandy parents exhaled a sigh of relief.

They thought the judge’s decision meant that all children were now able to return to the three school districts they had transferred to last year after the transfer law was upheld by the Missouri Supreme Court.

To their credit, this was how Ritenour and Pattonville interpreted Judge Burton’s decision. The two districts decided to accept all transfer students who had reapplied for the 2014-15 school year.

However, Francis Howell opted to accept only the one child named in the lawsuit, excluding the 350 other students who had reapplied for transfer.

Now, the fate of nine more Normandy students is in the hands of a judge. Attorney Joshua Schindler will appear in court today, fighting again for the rights of Normandy children to attend an accredited school of their choice.

Regardless of the judge’s decision concerning the several children named in this lawsuit, Francis Howell and Ferguson-Florissant should accept all Normandy transfer students.

These children have made their choice. Their choice should be respected, not just because it’s legally sound, but because it’s the right thing to do.

The Transfer Law: Another Disappointment

Posted on August 19, 2014January 13, 2026 by Brittany Wagner

Cameral Cotton’s children were deeply saddened when they learned they would not return to Francis Howell School District. Cameral’s three children transferred from Normandy School District after the state’s transfer law was upheld last summer.

Through a series of legal maneuvers, the Missouri Department of Elementary and Secondary Education (DESE) and the State Board of Education attempted to prevent students, like Cotton’s children, from transferring from Normandy Schools Collaborative.

First, Normandy was unaccredited, then nonaccredited, and most recently, “accredited as a state oversight district.” However, the transfer law, which states that a student living in an unaccredited district can transfer to an accredited district, prevailed Friday when Judge Michael Burton ruled that Ritenour, Francis Howell, and Pattonville School Districts would have to accept transfer students.

Cotton rejoiced when she saw the news over the weekend, only to learn from Francis Howell School District that the decision extended to just the children named in the lawsuit. Only one Normandy student will be returning to Francis Howell. Because Cameral Cotton did not participate in the lawsuit, her children will remain at Normandy.

Cotton’s daughter, Mar’Kita, dreams of becoming a history teacher for Teach for America. Her son, Mark, just wants to get into college. Both of these children blossomed at Francis Howell, and yet, they must remain in a school that, they believe, failed them.

If the transfer law was upheld for a few students, then it should be upheld for all students. Cameral Cotton should not have to wait for another class-action lawsuit just so her children can attend an accredited school. Burton’s decision may just apply to a few students, but the logic behind his decision applies to all Normandy students.

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