Normandy Superintendent Calls For Passage Of Senate Bill 493

Posted on by James V. Shuls

Ty McNichols

“Now SB493 needs to become law this session so our district can retain the talented staff that is so hard to recruit to an urban district.” Those were the words of Normandy Superintendent Tyrone McNicols in a commentary on St. Louis Public Radio this weekend.

As readers of the Show-Me Daily blog know, Senate Bill 493 would fix many of the problems with the transfer law and would create a local private option for students. This local private option would allow students in unaccredited schools to attend a nearby nonsectarian private school.

It is this local private option that has the alphabet soup of education groups (MASA, MSBA, MNEA, etc.) railing against SB 493. As I have said before, the education establishment has taken an all-or-nothing approach on this issue. They are not interested in compromise. They are solely interested in stopping school choice.

Missouri Sen. John Lamping (R-Dist. 24) put it this way during a recent Show-Me Institute panel discussion about the topic [emphasis mine]:

The establishment is quite comfortable with nothing happening. They can’t say it publicly, but they’re very comfortable with nothing happening. Normandy will be bankrupt by July, they will lapse the district, they’ll merge with the surrounding districts. Riverview Gardens will go bankrupt next year; they’ll do the same thing. And, two or three years from now, a neighboring district will probably go through the same process of unaccreditation and becoming bankrupt. The establishment is fine with that. They will not give any reform in exchange for fixing the system.

If this bill does not pass, it is the establishment that will have killed it and in effect, sealed the fate of the Normandy School District.

Superintendent Ty McNichols doesn’t want to see that happen. He recognizes that “no bill is ever perfect, and there are issues in the bill that are controversial,” but he also recognizes when it is time for compromise. This is just such a time.

Video: Our School Choice Event Is Now Online

Posted on by James V. Shuls

On April 25, the Show-Me Institute was delighted to have Missouri Sen. John Lamping (R-Dist. 24), Missouri Sen. Maria Chappelle-Nadal (D-Dist. 14), and Missouri Speaker of the House Tim Jones (R-Dist. 110) join us for a panel discussion about tax credit scholarships and school choice. Our event received some great coverage from the St. Louis Post-Dispatch and St. Louis Public Radio.

The lawmakers were candid and provided a great discussion about school choice and a potential fix to the problems with the inter-district transfer law. The Post-Dispatch’s editorial board pulled one comment during the lawmaker’s panel discussion and its press coverage gave a scathing criticism. Unfortunately, members of the editorial board were not there in person and did not get to hear all of the comments.

Well, they can watch them now. The panel discussion as well as the other presentations are now available.

Maybe they can pull some other quotes. Here are some of my favorites:

Sen. Lamping:

Missouri has a very strong filibuster. We have 34 senators and two or three or four senators can stop just about anything. But, I’m not here to tell you that two or three senators are opposed to choice. I’m here to tell you that institutional education in Missouri is the single strongest lobby that is in the capitol, bar none.

Speaker Jones:

This [school choice] will not be the end of public education as we know it. How do we know that? Because many, many, many states have incorporated many of these things we’ve talked about and they have vibrant public education school systems and private education systems, charters. Some even have vouchers and they still have public schools. So, I think it is time to try something new and give people a choice.

Sen. Chappelle-Nadal:

There is not going to be a bill without the private option. I know that. Ray Charles would know that.

Diverting City Tax Dollars To Subsidize The Loop Trolley

Posted on by Joseph Miller

Earlier this week, a U.S. District Court dismissed a lawsuit against the Loop Trolley Transportation Development District (TDD), clearing the way for trolley construction in Saint Louis. Like all streetcars, the Loop Trolley will have high capital costs: $43 million for a 2.2-mile route.

While the federal government is expected to pay for more than half the project through an Urban Circulator grant and New Markets Tax Credits, local residents still will have to shoulder a hefty portion. One way Saint Louis residents will pay to build the trolley is through Tax Increment Financing (TIF).

According to Loop Trolley planning documents, $3.5 million of the Loop Trolley’s capital costs will come from TIF raised from the Delmar East Loop Redevelopment area. For those unfamiliar with TIF, the government allows a developer to use the additional taxes a development might generate as a revenue stream to finance bonds to get the development started. In order to receive TIF, the government usually has to declare a property “blighted,” meaning it damages the welfare of the area due to its condition.

But how can TIF, designed to subsidize new developments, be used to fund a transportation device?

First, the city previously passed an ordinance that allows TIF money to be spent on anything that can be seen as an improvement to an area, not just subsidizing new development. Second, the city entered into a redevelopment agreement with a non-profit corporation (Loop TIF Inc.), which would receive and distribute any TIF revenue instead of granting it to an actual property development.

Of course this still leaves a major problem: who in the area is going to generate the TIF revenue in the first place? If the city designated truly depressed areas as blighted, and the future TIF revenue goes to Loop TIF Inc., there would be no upfront TIF subsidies to lure development into the blighted area.

In other words, if a TIF is genuinely needed to subsidize development that will pay for the TIF bonds by increased tax revenues, how can it possibly work if the “development” is a non-profit streetcar that won’t generate any revenue that the TIF can use?

The solution? Include areas in the TIF that were going to be developed anyway. The largest part of the TIF area includes Washington University in St. Louis’ north campus, built on land the university acquired for that purpose two years before it was included in the TIF district. That project will generate plenty of employee earnings taxes that the TIF can capture. The TIF also includes parcels that contain the Pageant theatre and commercial property that houses restaurants such as Pie Pizza. Plenty of sales taxes already are available there. Blight must truly be within the eye of the beholder.

EDL TIF

TIF supporters claim TIF is necessary to spur economic development in areas where it would not occur otherwise. This TIF clearly does not do that, as the city purposely chose to use TIF for areas already being developed. Instead, it is, in fact, a bookkeeping tactic through which taxes that would have gone to the city are diverted to an unelected corporation to spend as it desires. And what it desires is a streetcar.

Missouri Charter Schools: Doing More With Less

Posted on by James V. Shuls

A new study gives Missouri an “F” when it comes to funding charter schools. The study, conducted by a team of scholars with the School Choice Demonstration Project at the University of Arkansas, systematically examined all funding, including private sources, and determined that Missouri charter schools receive $4,717 less per pupil than the district public schools. The graph below shows it all.

Despite receiving significantly less money, studies have shown that Missouri charter schools are outperforming their neighboring traditional public schools. The fact that charter schools are doing more with less is a testament to choice and competition in education. When schools are free from bureaucratic regulations (like teacher tenure) and students are free to choose their school, good things happen.

UARK Charter Funding Disparity Figure 1

Expanded Opportunities: A Discussion About Tax Credit Scholarships

Posted on by James V. Shuls

Many students in unaccredited school districts want and need better educational options. However, Missouri’s public school leaders do not want to provide those options through inter-district choice programs. They worry that inter-district choice would bankrupt struggling school districts and place an undue burden on the more successful ones. There is, however, an option that avoids these problems – private school choice financed through tax credit scholarship programs. These programs, which are in place in 14 states, expand educational opportunities for K-12 students by generating private investment in education.

The Show-Me Institute and the Hammond Institute for Free Enterprise at Lindenwood University hosted a discussion about tax credit scholarships, explaining what they are and how they might be beneficial to Missouri. During the event, Jason Bedrick and Jonathan Butcher presented information from their recent Show-Me Institute case-studies and Paul DiPerna presented the findings of a new poll. The discussion also included a legislative panel that included Missouri Senators John Lamping and Maria Chappelle-Nadal and Missouri House Speaker Tim Jones. You can view the papers and video of the presentations via the links below.

 

  • Bedrick case study:
  • Bedrick presentation:
  • Butcher case study:
  • Butcher presentation:
  • DiPerna presentation:

Highway Robbery: Missouri Senate Passes Sales Tax Hike For Transportation

Posted on by Joseph Miller

Yesterday, the Missouri Senate passed a bill that would use an increase in sales taxes to pay for transportation projects, mainly state highways and bridges, throughout the state. As we have discussed in op-eds and in testimony before the Missouri Senate, this sales tax is the wrong way to solve the Missouri Department of Transportation’s (MoDOT) funding problems. A few of many criticisms:

  • The bill will create a bonanza for new major road construction as well as significant dollars for whatever transportation project local planners see fit. Don’t drive much, if at all? Now you get to pay to expand urban highways. Don’t live in Kansas City? Now you also can pay for the city’s $500 million streetcar. The amount of money Missourians pay will have nothing to do with how much they use or benefit from the project. The lack of a connection may be necessary in other areas of government, but a connection is imperative for transportation funding.

  • The tax is regressive and unfair. While the sales tax will hit people of all walks of life, the main beneficiaries will be those who use the highways most, chief among them interstate truckers. According to an industry representative, 45 percent or more of the traffic on major Missouri highways is trucking, many of whom might be transiting the state and not paying the sales tax. A poor family that uses transit in Saint Louis should not be paying more for the I-70 rebuild than a semi headed from Denver to Indianapolis.

  • It is unsustainable, bad economic policy, and not temporary. MoDOT is driving off the funding cliff because Missouri has not made the necessary alterations to its user tax base to pay for state roads and bridges. The bill, far from fixing those problems, specifically does not allow alterations to that tax base while proposing a non-user tax that will encourage overuse of roads, pollution, and sprawl. Ten years from now, all of MoDOT’s underlying tax base problems will be worse, meaning an indefinite extension of the sales tax hike.

  • A 1 percent or .75 percent sales tax would be one of the largest tax increases in recent state history (taxing Missourians to the tune of $534 million per year), and almost nullify the effect of the proposed income tax cut, should that ever come into force.

If the state legislature and the people of Missouri seriously wish to fix transportation funding in this state, they need to look for economically sound policy solutions and not short-term fixes that cause greater problems down the road.

Kansas City Streetcar’s Economic Development Claims Just Seem Silly

Posted on by Patrick Tuohey

Light Rail Icon

We wrote recently about NextRailKC’s poorly compiled and even more poorly considered claims of economic development resulting from the streetcar. NextRailKC corrected the original chart after we pointed out some basic mathematical errors. But the new chart’s claims of economic development still contain some very questionable assumptions.

For example, the chart claims that the streetcar “impacted” the General Services Administration (GSA) decision to move downtown. We were skeptical and a quick Google search confirmed our suspicion. A Dec. 10, 2013, story in the Kansas City Star suggests otherwise:

The location of Two Pershing Square near the new downtown streetcar line scheduled to open in 2015 was an added benefit. It’s also close to bus routes and a rental bicycle station.

The building has parking for 1,700 vehicles, but the GSA will use only 28 for official vehicles. The federal government does not pay for employee parking but does reimburse workers using public transit.

“The streetcar is a bonus,” [GSA Regional Administrator Jason] Klumb said.

That doesn’t sound to us like the streetcar had any “impact” on the decision, but was considered after the fact. Yet city officials consider this to be $50 million of the $900 million in so-called economic impact, “wholly or partially influenced by the streetcar project.”

It is clear that the streetcar wasn’t really a contributor to GSA’s decision to move. What’s more, it is likely that very few of the GSA employees will use the streetcar to get to and from work. Judging by the size of the parking garage (to repeat – 1,700 vehicles), GSA clearly expects them to drive.

But streetcar proponents seem to think that GSA employees will relocate into the Columbus Park apartments at the northern end of the streetcar line. According to a story in the Kansas City Business Journal:

A few months later, the General Services Administration will begin moving 900 employees to Two Pershing Square, which will be adjacent to the southern end of the new streetcar line. [Senior VP for Zimmer Real Estate Services LC, Dan] Musser said that means the Columbus Park project’s initial apartment construction could be filled by GSA employees alone.

This is how streetcar economic development works: when a large employer moves a few miles north to the yet to be built streetcar line, you claim credit for the move. Then you suggest that all those employees will sell their homes and relocate to another point on the streetcar line. We’re tempted to write this off as Musser just being silly, but given other economic development claims that streetcar supporters have made, those very well may be the assumptions they are making.

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