Page 494 – Show-Me Institute

Entrepreneur vs. Government: Fashion Trucks

Posted on July 29, 2013May 5, 2026 by Kacie Barnes (Galbraith)

Emily Ponath wants to bring high fashion to office workers on their lunch breaks in downtown St. Louis. However, Emily’s been unable to get a permit from the city to park her mobile boutique, Rack + Clutch, on public streets. She needs the permit because the regulations that govern other vendors, like food trucks, don’t apply to her fashion truck. St. Louis’s leaders should cut through the red tape and allow Emily and similar small businesses to expand the economic activity downtown through entrepreneurial innovation.

What Should Crestwood Do?

Posted on July 29, 2013May 5, 2026 by David Stokes

The Crestwood Tax Increment Financing (TIF) proposal is dead, at least temporarily. Joining it in death is Crestwood Mall, also perhaps temporarily. City officials in Crestwood did the unthinkable and actually questioned the basis for giving large sums of public money to private developers. In return, the developer has reacted to not getting millions of dollars of other people’s money by closing Crestwood Mall (a.k.a. Crestwood Court), and pulling out of talks with the city. That is fine — it is what I would expect.

Perhaps more surprisingly, the city’s urban planning partner, PGAV, has stopped working with Crestwood because, for once, a city didn’t do exactly what PGAV told them to do. Here’s hoping that this example of a city listening to its residents and voters instead of its planning consultants gains a lot of traction.

From a municipal finance perspective, Crestwood’s solution to the closure of the mall is straightforward: join the sales tax pool. As of 2010, Crestwood was receiving $189 per capita for its general sales tax, while the pool cities received about $116 per capita. However, the $189 number has probably gone down a lot since then, and is certainly going to go down fast now that the mall has closed. Joining the sales tax pool is the answer for city finances, both short-term and long-term. Would some services have to be reduced and some taxes raised? Perhaps. But responding to this situation by trying to resuscitate a failed mall with a huge TIF would be insane. Just look at Northwest Plaza to see how that simply will not work.

From the perspective of what to do with the space, that is going to require a commitment to patience and a faith in free markets. Just look at our recent (and now very timely) video about the rejected TIF in Olivette as an example of how good things can and will come without huge incentives if you give it time.

I went to Crestwood Mall plenty when I was younger. I remember its glory days. Those days are not coming back. Reacting to the closure with some huge tax subsidy and more corporate welfare won’t work either. No matter how grandiose the planner’s dreams may be, it does not justify taking other people’s money to give out more corporate welfare. Crestwood officials deserve great credit for their judiciousness so far. Here’s hoping it holds.

For A Few Dollars More (Terminal Financing – Part 2)

Posted on July 26, 2013May 5, 2026 by Joseph Miller

According to the Kansas City Star, adding $14 to every ticket will have little repercussion on Kansas City International Airport’s (MCI) financial position. Unfortunately, it does not accurately reflect how airports operate or the important negative impacts of higher fees at MCI.

The Show-Me Institute post that the Kansas City Star responded to showed that the claims from the Kansas City Aviation Department about the moneymaking potential of a new airport are incorrect. My post ended with the statement that MCI would have to find federal funding, use local taxpayer money, or increase landing fees. The Star rightfully points out that I used rounded-down debt payment estimations — to give the city the benefit of the doubt on finding construction savings.

However, the treatment of the $14 per passenger misrepresents the actual impact to the airport. First, an airport cannot legally place a per-head charge on passengers. Only the United States Congress can do that, and the current cap is $4.50 a person. If MCI requires $14 more per passenger to break even, it will have to pass that cost onto the airlines or find the revenue on its own. Given MCI’s current contracting model, the airport is responsible for terminal debt and needs to either raise fees on airlines or sell $40 million more in hot dogs. While MCI may be able to pass all $14 onto the airlines, it would affect MCI’s ability to find new tenants to increase or maintain passenger volume. In addition, the reliance on airlines for funds means MCI is highly exposed to airline bankruptcy, which in the past has allowed major airlines to push debt onto the airport.

Additionally, the idea that this is just “a day at the movies” is incorrect. Airports compete with each other and various transportation services for customers, and they do so based on market size and cost per enplanement (CPE, or cost per passenger). Having a high cost per passenger can mean fewer passengers, as the marginal leisure traveler chooses not to fly for vacation and businesses decide to economize on airline tickets. This, in turn, reduces airline profits and constricts service, which further pushes up CPE. This is precisely why that measure is a major point in airport bond ratings, and why MCI currently advertises the fact that its CPE is only $5. The Star seems to assume that $19 per passenger, far above the median CPE for peer airports, will have no effect on MCI’s bond ratings or competitiveness.

There is no way to predict the future, but moving from a low-cost, low-debt airport to an extremely high-cost, high-debt airport that has lost passengers over the last decade is risky for MCI and Kansas City taxpayers.

New Essay: Redefining Public Education

Posted on July 26, 2013May 5, 2026 by James V. Shuls

What does it mean to support public education? To some, it means supporting the traditional system of education, whereby students are assigned to a local school based on where they live. In my new essay, “Redefining Public Education,” I discuss why this notion is completely and utterly wrong. Public education is not a system, it is the idea that all students should have access to a quality education at public expense.

For too long we have clung to a system, believing it defined public education. As I write in the essay:

It is time we redefine public education. It should no longer mean assigning students to a specific type of school, regardless of quality, but rather that we provide access to a quality education, regardless of the type of school delivering that education.

Essay: Redefining Public Education by James Shuls, PhD by Show-Me Institute

The Kansas/Missouri Economic Border War, In A Graph

Posted on July 24, 2013May 5, 2026 by Patrick Ishmael

Via the U.S. Bureau of Labor Statistics, who does it look like has been winning the battle lately?

Stay above the line and you gained jobs; drop below the line and you’ve lost them. And to be clear, the Kansas City, Kan./Kansas City, Mo., designations here are references to the Metropolitan Statistical Areas that compose the Kansas City metropolitan area; indeed, the data used here is appropriately broad and provides a fuller picture of Kansas City’s regional economic picture by including other large Kansas and Missouri cities along and around the border — from Overland Park to Platte City and beyond.

In the past, we’ve talked about how jobs have moved, or simply disappeared, from Kansas City’s city center in the past decade. These BLS figures provide further meat to those bones, showing that when it comes to job creation and growth, the advantage right now appears to be very much in Kansas’ favor. The question is, how long will Missouri let that undesirable status quo remain?

MCI’s New Terminal Won’t Be A Money Maker (Terminal Financing – Part 1)

Posted on July 23, 2013May 5, 2026 by Joseph Miller

An optimistic projection of future income still shows that Kansas City International Airport (MCI) will lose tens of millions of dollars a year trying to pay down the debt for a proposed new $1.2 billion terminal. The Kansas City Aviation Department may believe that a billion dollar project will satisfy the pride of the city government, but it cannot expect that any potential increased income will match the investment costs.

The yearly debt service required to pay off the $1.5 billion in bonds requested for the new terminal is more than twice MCI’s current net income, which was $30 million from operations in 2012. In order to pay off $1.5 billion in new bonds, MCI would have to pay an additional $68 million per year in interest and amortization. To support their plan, officials with the Aviation Department claim that the project will increase concession revenue and decrease security and maintenance costs.

According to the Aviation Department’s plan, the new terminal will increase revenue with more space for restaurants and services. However, in 2012, MCI only made $14 million from rentals and concessions. Comparing MCI with peer airports (pages 73-75) it could, at best, double concessions and rental fees. That would generate an additional $14 million in revenue.

The current cost of law enforcement and terminal maintenance is about $14.5 million. Reducing security lines and using a new, centralized facility is projected to decrease costs, but there is a limit to efficiency savings. In addition, MCI receives sizable federal grants for security and maintenance, so the federal government will share any savings. So, as a best-case-scenario, let’s be generous and assume that the annual cost savings is $7 million.

The figures suggest that Kansas City will not recoup its new investment costs even in the best conditions. Even if MCI doubled its concession/rental income and slashed its security and maintenance by 50 percent, the airport could cover less than a third ($21 million) of the project’s $68 million yearly financing costs.

Ultimately, the airport will have to bridge that $47 million gap with higher landing fees, federal grants, Kansas City taxes, or an unappealing combination of the three.

Show-Me Minute: Tax Credits

Posted on July 23, 2013May 5, 2026 by Darin Morley

The Show-Me Minute is a short radio advertisement to inform listeners about the work of the Show-Me Institute in a particular policy area. In this Show-Me Minute which first aired on KWTO 560AM in Springfield, MO, we discuss tax credits.

Transcript:

Know any big time gamblers?

Sure you do. They’re your elected
officials. They gamble all the time with tax credits. Tax credits sound like
a great idea–a way to attract business without spending any money. It’s
like using your credit card to buy that expensive watch or HD TV you’ve
always wanted. You don’t have to pay any money up front and you figure
you’ll somehow have the money when you need it. So Governments hand
out tax credits like candy, rolling the dice with your dollars and betting that
they can pick winning businesses.

But tax credits aren’t free money. Often the gamble doesn’t pay
off and then the bill comes to you in the form of reduced services or
higher taxes. Why should lawmakers gamble with your money? They
shouldn’t. Let the free market work. If a business idea is such a good one,
let private entrepreneurs develop it and assume the risk.

This has been the Show-Me Minute.~ learn more about the Show-Me
Institute, where liberty comes first, click on our website at ShowMeInstitute.org

Kansas City School’s Untested Tech Program

Posted on July 23, 2013May 5, 2026 by Patrick Tuohey

The Kansas City School Board recently unveiled a new program in which they’ll give each student a tablet computer.

Andrea Flinders, president of the local teachers’ union, was critical of the plan, saying:

If you think throwing a computer at [students] in August and letting them take it home is going to automatically cure all the evils of this district, then you are clueless.

Flinders is correct; there is no compelling research indicating that such an approach is worthwhile. And if the school district wants to test such a program, this is not how they should go about it.

An article in Salon Magazine sheds some light on the practice, which is not limited to Kansas City:

[F]or all the anecdotal evidence supporting iPads, there’s other anecdotal evidence from schools that suggests iPads actually harm education.

What do school board members make of the controversy? Board Member Kyleen Carroll told teachers that if they are not on board with the plan to “go somewhere else.” This is similar to a reaction from Missouri Department of Elementary and Secondary Education (DESE) officials when parents objected to scripted answers to their questions about the Common Core State Standards. Officials said, “If you are unable to follow the way we are going to hold this meeting, you’re welcome to go ahead and leave.”

Of course, some families will do exactly that. In some ways, that is normal and fine. That is how cities and schools are forced to compete. However, for poor families, that is not exactly a realistic option. And it is never the proper reaction from a public official such as a school board member.

Parents and teachers are frustrated with the education bureaucracy’s inability to efficiently and effectively educate our children. If anyone needs to leave or go somewhere else, it is the bureaucrats, not the parents.

Saint Louis Public School District Adds Blue Chip To Portfolio

Posted on July 23, 2013May 5, 2026 by Allison Davis

Often, the best way to solve a problem is to try a new strategy. In 2011, Saint Louis Public Schools (SLPS) Superintendent Kelvin Adams announced that the district would offer a “portfolio of schools” to improve its system. Last week, the district announced that Adams and SLPS are making good on that promise. SLPS has formed a unique partnership with KIPP (Knowledge is Power Program) St. Louis, a high-performing, established charter school. With KIPP, SLPS will be adding a blue chip to the district’s portfolio of schools.

Previously, KIPP and SLPS operated as separate districts, or Local Education Agencies (LEA), with separate funding, buildings, and evaluations. Under the new partnership, KIPP will get access to vacant SLPS buildings; in exchange, KIPP’s student achievement results will be counted as part of SLPS’s as if they are one district. Unfortunately, Missouri does not evaluate public schools individually; evaluations are conducted by district. Therefore, KIPP’s high achievement scores will likely inflate SLPS’s evaluation and buoy underperforming public schools. Nevertheless, the new partnership between SLPS and KIPP should be applauded because it marks a step forward in how Saint Louis operates its school system.

In the book The Urban School System of the Future: Applying the Principles and Lessons of Chartering, Andy Smarick writes:

The world increasingly, and accurately, thinks of a city’s K-12 education system as a collection of diverse schools, not a single, dominant administrative unit. This is the reason why the term “portfolio of schools” has become a staple of the education lexicon. It is also the reason why more and more leaders are drawing a distinction between a “school system” and a “system of schools.”

The portfolio model acknowledges that there is no one-best way to educate kids. The new partnership between KIPP and SLPS recognizes that charter schools and traditional public schools can cooperatively co-exist. When they do, everyone wins. I hope this new relationship between the district and charter schools will be the first of many. By adding quality charter operators to its portfolio of schools, Saint Louis can redesign its educational landscape and continue to improve the “system of schools.”

The work of the Show-Me Institute would not be possible without the generous support of people who are inspired by the vision of liberty and free enterprise. We hope you will join our efforts and become a Show-Me Institute sponsor.