Take the Land Bank Legislation. Please.

Posted on by Audrey Spalding

Last night, yet another piece of legislation received the “Kansas City Land Bank Bump.” Senate Bill 729, which began as a short, three-page bill, ended the night at an impressive 78 pages.

The bill originally was a relatively uninteresting piece of legislation meant to improve procedures for Missouri counties making purchases. Now, the poor thing is bloated with language addressing, among other things, Springfield School District board elections, local debt collection, economic development boards, and the creation of a Kansas City land bank.

The land bank “amendment” alone added 35 pages to SB 729. This is the third time the land bank legislation has been tacked onto an unrelated bill. First, it was attached to a bill that was supposed to improve transparency. Then it was added to a bill that was supposed to help counties manage their budgets.

This last-ditch attempt to push legislation to the finish line by any means necessary is unfortunate and opaque. We saw efforts like this last year, when legislators rolled an extensive list of bills into a 356-page behemoth that entailed the creation of hundreds of millions of dollars in tax credits. Despite that bill’s failure, it appears that land bank proponents are taking a page from tax credit proponents’ strategy manual.

If legislators intend to vote on this bill before the end of the legislative session on Friday, I hope they at least take time to read it. The land bank legislation (or “amendment”) raises a number of questions that remain unanswered:

  • Why allow a government land bank to bid against private would-be buyers? Don’t we want this property to have a chance of being redeveloped privately? (141.984.6)

  • Why allow a government land bank to incur debt without limitation? (141.981.6 (3))

  • Why allow a government land bank to borrow against promised funds from the state of Missouri? (141.994.1)

  • Why allow a government land bank the power to build, construct, lease, and furnish property? Wouldn’t that put it in direct competition with the struggling private real estate market? (141.983 (13))

  • Why create a government land bank? Where is one example of a government land bank that has accomplished a significant reduction in vacant government-owned property?

Patrick Ishmael on Jaco Report – Voter ID

Posted on by Patrick Ishmael

On May 13, Show-Me Institute Policy Analyst Patrick Ishmael appeared on
Channel 2’s Jaco Report in Saint Louis to discuss the merits of voter ID reform in Missouri. Appearing opposite Ishmael and arguing against changing existing voter ID requirements was Denise Lieberman, a Saint Louis attorney and community activist affiliated with the Advancement Project.

View the video on Fox 2’s website by clicking here.

If the above is unavailable, try here.

Last Week For TIF Reform

Posted on by David Stokes

In my personal opinion, the single most important thing the Missouri General Assembly needs to do this year is pass Tax Increment Financing reform. SB 721 is a great way to accomplish that for the Saint Louis area, at least. The bill has passed the senate and a house committee. All it needs now is to pass out of the full House of Representatives. Passing this bill would be a great policy change for Missouri as it would greatly reduce the tax giveaways that are killing our local property tax base and encouraging the worst types of local economic planning and eminent domain abuse.

SB 721 would limit the ability of cities to override the county TIF commissions. It would greatly reduce the absurd spectacles of city councils representing a few thousand people imposing their will over the objections of county TIF commissions representing a few hundred thousand people.

Yes, I would like to see these reforms moved to other parts of the state as well, especially the Kansas City area. But for now, limiting TIF in Saint Louis would be a great start. Passage of TIF reform and SB 721 would be an outstanding policy change for Missouri.

Land Banking is Expensive

Posted on by Audrey Spalding

In the final week of the legislative session, Missouri legislators may vote on the creation of a land bank in Kansas City. Given the attempts to attach the land bank legislation in its entirety to unrelated bills as an “amendment,” there is a good chance that some legislators will try to get the bill passed this week.

In addition to testifying and providing suggested changes to the legislation, I have also written here repeatedly about the pitfalls of creating a land bank, in light of the 40 years of failure we have experienced in Saint Louis City. If legislators — despite the evidence that land banking can lead to abuses of political power and poor decision making — still want to pass the land bank legislation, perhaps they should consider recent land banking news from other states:

The Columbus, Ohio land bank is asking the State of Ohio for money.

The fiscal note for the land banking bills (H.B. 1659 and S.B. 795), reports that passing the legislation will not cost the state money. However, the legislation itself mentions possible funding from the state several times. Columbus, Ohio provides a good example of what could occur if the Kansas City legislation is passed. The new land bank is requesting $8.2 million from the State of Ohio. A newly established Kansas City land bank could make a similar request.

The Saginaw, Mich. land bank bought a hotel, used it for police training exercises and now plans to spend up to $400,000 to demolish the hotel and build an “aesthetically pleasing parking lot.”

Regular Show-Me Daily readers know that we are not a fan of government development bets. Well, land banking takes that practice to the next level. Instead of government officials attempting to pick winners and losers by awarding tax subsidies, land banks can purchase and attempt to redevelop property. What could possibly go wrong?

Consider the case of Saginaw, Mich. In December, the Saginaw land bank purchased a hotel for $235,000. Since then, refrigerators and microwaves have been looted, and the sheriff’s department has conducted “emergency response exercises” there. The building is riddled with black mold, and the county is paying $15,000 per month for utility costs at the vacant hotel.

Government officials say that investors aren’t interested in the property, so the next step is to demolish the building and build a parking lot. The demolition is estimated to cost another $300,000 to $400,000.

The Missouri land bank legislation is modeled on Michigan’s land bank law. If legislators pass S.B. 795 or H.B. 1659, a Kansas City land bank would have the powers to make similar development bets with taxpayer money.

The Missouri Legislature passed land banking legislation in 1971, and it has been an abysmal failure. The Saint Louis land bank holds more property than ever, and pays more than $1 million every year just to mow the grass on its properties. Why repeat past mistakes?

The Deadline Hath Arrived

Posted on by Michael Rathbone

The appropriators in Jefferson City have managed to finalize a budget before the May 11 deadline. The final version of the budget amounts to a little more than $24 billion. The key differences between the Missouri House and Senate budgets that held up the conference committee from crafting a final budget seem to have been resolved.

The most recent stumbling block involved funding for the Sue Shear Institute for Women in Public Life. The Institute’s goal is to help prepare women to run for public office. There is nothing wrong with that, but should taxpayers foot the bill? In economic times such as these, it should be a relatively easy call to cut funding for programs like this one. Apparently in Jefferson City, the call was not so easy. The Shear Institute gets to keep state funding. This fracas is indicative of the problems that plague Jefferson City.

If deciding on whether to cut funding for a non-essential program like the Shear Institute can cause the budgeting process to screech to a halt, what would happen if something much bigger was on the table, such as tax credit reform? Organizations on the left and the right have called for tax credit reform, but yet there seems to be little movement to actually enact any meaningful reform (a reform, by the way, that, if enacted, would do a lot to alleviate the current budget situation in which the state finds itself).

The budget impasse has been resolved. However, this situation is indicative of the obstacles facing any reform measure that might be proposed.

A Rare, Wonderful Opportunity To Deliver Better Health Care To Missouri’s Underserved

Posted on by Patrick Ishmael

In February, I wrote at length about an important charitable organization, Remote Area Medical (RAM), which delivers free health care to those who otherwise could not get it. Indeed, RAM and organizations like it have helped patients all around the world. As I found out from RAM’s founder Stan Brock, however, excessive Missouri licensing laws have hampered his group’s mission to help the needy in this state.

Mr. Brock told me that RAM wanted to do more in Missouri, but onerous state requirements — such as requiring licensed in-state medical personnel to participate in a clinic before RAM could provide its services — had stifled his organization on several occasions. Most recently, he said, Missouri regulations prevented RAM from providing free eyeglasses to the southwest corner of the state.

Well, Missouri may be on the verge of rectifying the problem if one bill gets to a final vote. Introduced by Rep. David Sater, House Bill 1072 appears to adopt much of the same legislative language used to facilitate volunteer medical services in Tennessee, which was a pioneer of the volunteer health services law. Better still, the legislation passed through the Missouri House in March and is now close to a vote in the Senate.

Given the movement in the health insurance exchange policy field and the Senate’s earlier allowance for a grade school optometrist mandate to lapse, this session may just be a banner one for health care policy in the state of Missouri. For more information on how burdensome occupational licensing laws affect Missouri, please check out our work in the area, which you can find here, here, and here.

Acts Of Land Bank Desperation

Posted on by Audrey Spalding

It was comical that Missouri legislators, apparently blind to irony, tacked a lengthy land bank bill onto a bill that was supposed to increase government transparency.

Well, lawmakers have done it again. The latest bill to get what I am now going to call the “Kansas City Land Bank Bump” is Senate Bill 692, a bill that was initially intended to help counties manage their budgets. This time, the bill ballooned from two pages to an impressive 93 pages. It appears that about 30 of those pages are dedicated to creating a land bank in Kansas City.

Given that a land bank created under this bill could entail unlimited amounts of debt, the addition of the land bank language to a county budget bill is almost as ironic as the previous act of desperation.

Moreover, these moves may not even be constitutional. The Missouri Constitution states that bills cannot contain more than one subject, and that subject must be clearly stated in the bill’s title. Does “decreasing county budgets” accurately describe a bill that would create a land bank? Perhaps, if SB 692 passes, a court will have to decide.

Look, if a land bank is such a great idea (and after extensive study, I do not think it is), why can’t legislators pass it on its own merits, instead of continuing to try and hide it as an amendment to unrelated bills?

If You Need A Subsidy In Chesterfield, Where Don’t You Need One?

Posted on by David Stokes

Monday night, the Chesterfield City Council gave preliminary approval to a new outlet mall development that plans to impose a Community Improvement District (CID) sales tax of 1 percent to help finance the project. This CID is a tax subsidy and a tax giveaway, just like any TIF (Tax Increment Financing), EEZ (Enhanced Enterprise Zones), or other route of central economic planning.

I will admit that CIDs are a little less noxious than TIFs. But, no matter what grading scale, tax subsidies are not needed in Chesterfield. The market for retail shopping is plenty strong that the city does not need to turn over the taxing authority to private developers. The real issue, however, is that with projects like this, we must acknowledge that we long ago passed the tipping point where basically every major development in Saint Louis and Kansas City is subsidized by the taxpayers. When you are going forward with subsidies for things like outlet malls in one of the nicest parts of the region, the idea of a free market is basically defeated. Once you subsidize outlet malls in wealthy areas, at what possible good or service do you draw the line?

The obvious answer is that there is no line and the use of tax dollars for subsidized, politically-connected developers is just a fact of life now in much of Missouri. That is repulsive.

Support Us

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.

Donate
Man on Horse Charging