Taxes And TIF In The Liberty School District

Posted on by Bruce Stahl

Soon, Tax Increment Financing (TIF) may claim another win. And when that happens, taxpayers can claim a loss. Kansas City officials are considering a TIF in the Liberty School District, less than a year after district residents voted down a 43-cent property tax increase. As I have pointed out, the Liberty superintendent claimed that previous TIF projects amplified the school’s need for a tax increase. It is safe to conclude that if the new TIF is approved, it will magnify the school district’s desire for a tax increase.

TIF allows developers to freeze taxes and invest any increase in property tax value that otherwise would go toward taxes into property development instead. Essentially, TIF costs taxing districts property tax revenue. For entities that do not rely heavily on property taxes, such as cities, TIF is not a big deal. But for taxing entities that rely heavily on property taxes, such as schools, TIF can be quite detrimental. If the TIF project in Kansas City moves forward, it could drive another vote for a property tax increase, and next time, the tax increase might not be rejected.

Tax Subsidies In Chesterfield

Posted on by David Stokes

Quick, try to think of a community that needs tax subsidies even less than Ellisville (not that Ellisville needed subsidies)? How about Chesterfield, Ellisville’s northern neighbor. (They do not actually touch, so they are neighbors like Denmark and Sweden, or Lesotho and Swaziland.)

Two different groups want to build outlet malls (or something close to it) in Chesterfield. Both want a tax subsidy; one in the form of a Community Improvement District (CID) and one in the form of a Transportation Development District (TDD). Both allow the developer to install an additional sales tax with the shopping area. Whatever the initials, the subsidies are not necessary.

Chesterfield should act like the girl being courted instead of the wallflower. I am not one for recommending that city councils reject projects – I question whether city councils should have a right to do that in the first place. But as long as the two entities are asking for tax subsidies, and as long as the Chesterfield City Council needs to consider these projects in the first place (for zoning reasons, etc.), Chesterfield’s elected officials should refuse both of them until they agree to move forward without a CID or TDD.

The subsidies are a total joke. If there is a market for more shopping in West County, taxpayers do not need to support it. The Chesterfield City Council should hold off until one, or both, of these proposals moves forward without taxpayer assistance.

Lack Of Leadership From Schools Requires State-Level Policy Changes

Posted on by Audrey Spalding

In my study of Missouri school superintendent compensation, I noted that many superintendents are promoted up through the ranks of school teachers. Similarly, many school board members are former teachers.

This means that when school administrators and board members consider layoffs and teacher termination, many of them may have fresh memories of serving as a teacher. Many may also have friends who continue to serve as teachers in the district. As a result, people who consider layoff and termination decisions in Missouri’s school districts may consider the impact on teachers more carefully than the long-term impact on students.

Though Missouri law technically allows for teachers to be terminated on the basis of “incompetency,” we have shown here that districts rarely fire teachers. For example, the Parkway School District, which employs more than 1,200 teachers, has terminated just five in the past 10 years. Though state law is part of the problem, school leadership certainly plays a role.

Education expert Rick Hess writes about school administrator’s lack of leadership triggering similar teacher tenure reform efforts in Massachusetts. He writes:

Given the freedom to craft sensible, quality-sensitive evaluations that thoughtfully give some weight to seniority, the state’s school boards and superintendents have . . . punted.

Hess’ observation is likely relevant to Missouri. In our collection of teacher tenure data, we have also requested some districts’ termination policies. Frequently, those policies follow state law, with little added.

So, even though Missouri law states that teachers “shall be retained on the basis of performance-based evaluations and seniority . . .” during layoffs, districts can, in practice, choose to favor teachers who have seniority.

This is why a legislative fix is needed. Missouri House Bill 1526 would require that a teacher’s individual performance be the “most heavily weighted factor” when layoffs are considered. School districts, which receive a tremendous amount of state funding, should not be allowed to make decisions that favor teachers at the expense of students.

Individual performance shall be the most heavily weighted factor, at not less

15 than seventy percent, which shall include evidence of increased student achievement;

Depressing News From Ellisville

Posted on by David Stokes

The vote of the five members of the Ellisville City Council in favor of Tax Increment Financing (TIF) is just atrocious. You had to be there to feel how passionately opposed to the TIF the strong majority of people were during the public forum. Later, you could sense how angry they were after the vote. I was there, and I certainly felt it. The residents had every right to be livid.

I do not recall ever seeing such a brazen example of an elected body ignoring the will of the people. Combined with the terrible economic policy they are now instituting, the choice of the Ellisville City Council to enact this TIF is one of the worst decisions I have ever seen a government make.

Now more than ever, we need the state legislature to pass major TIF reform for Saint Louis County and all of Missouri. The ability of cities to override a county TIF commission must be removed. Furthermore, TIF districts should be required to make other taxing districts whole through alternate tax dollar arrangements. In other words, cities should share the sales tax dollars placed into the PILOT (Payments In Lieu Of Taxes) fund.

We still have many more TIFs to fight in Shrewsbury, Saint Ann, and Richmond Heights; and that is just Saint Louis County. Add in the Enhanced Enterprise Zone (EEZ) in Columbia, the Transportation Development District (TDD)/Community Improvement District (CID)  in Chesterfield, the incessant use of subsidies for every project in Kansas City and Saint Louis, and I can assure you we will be very busy. When it comes to pointing out the economic flaws in the terrible arguments for local development subsidies, the Show-Me Institute has only just begun to fight.

Now I am going to get some lunch. (Go to the 2:04 mark.)

When Is a Transparency Bill Not a Transparency Bill?

Posted on by Audrey Spalding

When it’s used to hide unpopular legislation.

On Wednesday, the Missouri House took an otherwise laudable government transparency bill and used it to hide legislation that would create a government land bank in Kansas City. The transparency bill, S.B. 467, ballooned from just two pages to about 40 pages with the unwieldy amendment.

Some legislators continue to push the Kansas City land bank bill forward, despite the fact that a similar land bank in St. Louis City has failed spectacularly. The Saint Louis City land bank has a history of rejecting would-be buyers, and allowing area aldermen to have outsize influence over who is allowed to purchase vacant city property.

If Missouri legislators want to throw the land bank dice again in Kansas City, they’re free to do so, even in the face of St. Louis’ failure. But, perhaps they should do that in a more transparent way.

The irony of using a transparency bill to hide another bill 20 times its size would be funny, if it weren’t so sad.

Big Night For Ellisville

Posted on by David Stokes

So, what is it going to be, Ellisville? TIF or no TIF?

Tonight is the scheduled final vote on the use of Tax Increment Financing (TIF) for a proposed development at Manchester and Clarkson Roads in Ellisville. We know why Show-Me Institute thinks this is a bad idea for Ellisville. If this TIF can be defeated, as far as I know, it would mark the first rejection of such a proposal by a point-of-sale city. Combined with Florissant’s rejection of a TIF recently, we would be making real progress toward stopping the constant use of subsidies around Saint Louis.

Stay tuned, and follow me on twitter (@DavidCStokes) for results of tonight’s vote.

Voter ID Matters

Posted on by Patrick Ishmael

We do not often wade into the waters of election policy, but frankly, election policy is intimately related to the free-market objectives we promote. Although voters are one step removed from the chambers that decide most policy issues, the only way elected representatives can fairly represent the will of the people is if the representatives themselves have been fairly elected. Debasement of the electoral process through fraudulent voting subverts the will of voters and disenfranchises voters themselves. And yet on Monday, Mother Jones called the states’ moves to get their arms around the problem and implement stronger ID requirements “loathsome.“

Let’s be clear: Voter fraud is real. Especially in recent weeks, the push has been on to paint “voter fraud” as some sort of manufactured controversy, but as someone who has worked in this field, I can assure you, it is not. From county officials telling poll workers that people can vote with a credit card as their ID — they cannot — to the use of absentee ballots fueling fraud, there is not only ample room for voter fraud to take place through the very structure of the voting process, but there have been cases of voter fraud suspected and prosecuted in the state just in the past few years.

Voter fraud can swing elections, especially close ones. If voter fraud constitutes 2 percent, or 1 percent, or even 1/2 percent of the vote total, how many races does that affect? How many statewide and local races have you seen decided by a point or less, and how likely is it that none of those races turned on fraudulent votes?

Every vote should count, every vote should be protected, and every attempt to distort the will of the electorate with the casting of illegal ballots should be turned back. Preventing voter fraud through reasonable identification measures that we already accept to drive cars, board airplanes, and enter some government buildings is not an undue burden on voters’ rights to vote. Rather, it is a burden on voters’ rights to allow the floodgates of voter fraud and abuse to remain open.

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