Your Property Is Your Kingdom ? Literally

Posted on by David Stokes

I am going to defer to his boss on the question posed in the title of Dave’s post on the Village Law, and just succinctly get to the heart of the issue. Liberty is not the issue in the village law. Dave is correct to point out that politics was one of the major reasons for objections to the law, and I hope he would agree with me that policy should not be created in the manner used for the village law. Major changes should be debated and voted on in the open, not attached at the last minute in a manner that means nobody will see. (Which could lead me to a rant about why the legislature does not allow computers that would display automatic black-lined changes for amendments on everyone’s desk in the capitol, but I shall save that for another time.) So, yes, the process was flawed and changes to Missouri’s incorporation procedures should have been reconsidered the proper way before the legislature this year, where they would not have come close to passing — hence, repealing it was the right thing to do.

The above applies even if the Village Law was a good law, and even more so considering it was a terrible law. The idea that a nuisance lawsuit is a reasonable way to for a neighbor of Mr. Plasters in the Ozarks to defend against a new casino (believed to be the ultimate goal) is not realistic. So, after a casino is built right next to you, you should go to small claims court and try to have it torn down? Or go up against the casino’s law firm to try to get some money from them? There is an enormous difference between the pettiness of a planning process that prevents one from having a strangely colored house or a front yard fence and a process that prevents a hog factory or a casino from locating wherever someone wants.

As for the person in Franklin County who wants to develop his property into 102 homes, Franklin County has legitimate concerns about that proposed development. Somebody has to build the roads, sewers, telephone wires, electricity, etc., to serve the new homes. Many of those new services would be paid for by other taxpayers, and even the ones that aren’t will certainly go through others’ properties. For things of this nature, it is not a violation of your natural rights to have to go through a process established by the people of the county in a democratic fashion.

The fundamental rights of life, liberty, and the pursuit of happiness do not and has never entailed the idea that anyone can form their own city, state, or country if they don’t like the democratic decisions of the majority of Americans. I believe we actually fought a war about this issue. There are many ways to fight for your desire to do what you want with your property other than forming your own political entity. And if sometimes you don’t get it to do what you want … hey, life isn’t always fair.

Look What Eminent Domain Has Done to Our Mindset …

Posted on by David Stokes

It was not long ago that when business owners heard about new development in their area, they greeted it with glee. Thanks to the abuse of eminent domain in Missouri, and the authority of local governments to decide that some types of businesses are better than others, that is not always the case any more. Today’s Post-Dispatch has an article about the public previews of the proposed bridge over the Mississippi. Check out this unfortunately valid concern from a nearby businessman (emphasis added):

Kevin Minden studied a map of the future Mississippi River bridge, looking for clues as to how it might affect his engine rebuilding shop.

One of the connector ramps will run a few blocks from his building, which has him concerned that the bridge might lead to a development boom. Minden fears losing his land to a developer.

"Everything in that area is old," Minden said. "What are they wanting people to see when they drive across?"

He fears a development boom! He should be praying for one to increase the value of his business; I hope his fears prove false, but they are certainly valid. There are numerous examples of these types of eminent domain takings throughout our state. Our former editor, Tim Lee, wrote the defining study about the abuse of eminent domain in Missouri, and I encourage you all to check it out if you have not already. Hopefully, Missouri will return to property laws that don’t make property owners fear improvements.

Am I a Village Idiot?

Posted on by Dave Roland

My esteemed colleague, Mr. Stokes, has repeatedly written about the much-reviled "village law" that caused such a ruckus in this past legislative session. I think his hostility is unwarranted.

The law, which was passed in 2007, allows small groups of property owners — potentially even just one property owner — to establish their own autonomous political units that would not be bound by many county regulations. Essentially, they would be free to develop their property as they chose, without having to deal with the red tape and over-regulation that is so prevalent in many localities. At its heart, this statute is friendly to property rights and liberty.

So, what about this law got people so angry? Politics. The way the bill was passed (it slipped through, virtually unnoticed at the end of the 2007 session) and the fact that a commercial developer filed a petition for a new 400-acre village the day the bill became law raised speculation that the law was intended to pay off supporters of the politicians who sneaked it into law. On top of the visceral reaction against any sort of special favors or corruption, counties realized that villages formed under the new law would be exempt from their attempts to exercise control over the residents’ property. County officials considered it a catastrophe that citizens might "preempt [their] local authority[.]"

But really, why is it a bad thing that small groups of citizens should be allowed to control their own properties? Bradley Ferguson, an individual developer seeking to incorporate his 40 acres as a village, is only doing so because the city of Washington has refused to annex him, and the county government will not grant him permission to build a subdivision on his land. I see it as a good thing that the current village law would let him seek out his own prosperity without having to live by someone else’s leave.

To be sure, there are some legitimate concerns about what would happen without zoning and other land use restrictions. After all, what if your neighbor suddenly decided to build a hog farm right next to your property? But the law has always had a remedy for this kind of thing! Where neighbors’ use of their property substantially impairs your ability to peacefully enjoy your own property (because of noise, odors, etc.), you may be able to sue them to receive compensation for their offense. The law of nuisance works to ensure that individuals retain their right to use their properties as they see fit, while also allowing anyone injured by that use to hold them accountable — all of which is a far better solution than granting government officials the authority to dictate how people will be able to live.

So, in short, I’m sorry to see the village law revert to a more conventional form. I think that concerns about the proliferation of local governments were ill-founded and, at any rate, that these localities would not likely have been worse than the sort of petty tyranny already on display at the county level. But, then again, maybe I’m just a village idiot.

Show-Me: The News

Posted on by Justin Hauke

KOMU Channel 8 News, the NBC-affiliate in central Missouri, ran a news story on Friday covering the Show-Me Institute’s newest tool for evaluating public school performance in the state.

Although we would have preferred the story to emphasize that our school rankings are based on the state’s own data, rather than our own interpretation, we are pleased nonetheless that Missouri parents now have access to tools for making informed public education decisions.

If you haven’t visited our Show-Me: Living website yet, be sure to check out our new school performance tools (see the banner above), as well as our Missouri tax estimator, which we released last month. And be sure to let us know if you have any questions or comments on how we can make these tools more useful to you.

Village Law Is Repealed, and Blocks Lots of Other Stupid Ideas on Its Way Out

Posted on by David Stokes

This could not have worked out better, frankly. The harmful "Village Law" that was passed last year was properly repealed in the session that just finished on Friday. The Springfield News-Leader had the story; it has covered this issue closely all year. The good news is that the dispute over the repeal of the law tied up the Senate (links via Combest) in a filibuster for many key hours during the end of the session.  There is no way of knowing how many harmful or just plain dumb bills were prevented from passage by the filibuster over the village law, which nonetheless passed in the end. (The Post-Dispatch struck a similar theme in its Sunday editorial, but I have to guess we have far different definitions of what constitutes a bad bill.)

So, in a sense, it was the perfect ending for the village law. And now, with its repeal, individual property owners will no longer be able to just declare themselves to be their own municipality on a whim. Lord knows the last thing we need in Missouri is more government.

Great Post-Dispatch Editorial About Tax Incentives and Clayton

Posted on by David Stokes

There is a terrific editorial in the Post-Dispatch today about how local communities use tax incentives to lure businesses. I recommend it highly. The focus is on Clayton, the home of the Show-Me Institute, which held out against tax giveaways longer than most other communities. Unfortunately, Clayton now feels it must compete better with other municipalities that are giving away the store, and it would be hard to prove them wrong.

The Post’s editorial touches on many of the same issues we have been writing about here at SMI, and I hope — without sounding as if I ate too much hubris — that some of our work may have influenced the Post‘s thinking. Some of the key points that SMI has extensively made include: tax incentive decisions should be made regionally, lower tax rates for everyone are preferable to tax incentives for the chosen few, and some areas have still managed to succeed without using these types of incentives.

At least Clayton has chosen to use partial tax abatements as the primary incentive. In my opinion, that option is the best-of-the-worst in this game, with full abatement and TIF being worse — and TIF with the use of eminent domain the worst of all. So I give credit to them for that, for what it’s worth.

Road Money Drying Up, Whatsoever Shall We Do?

Posted on by David Stokes

MoDOT is predicting that road projects in Missouri, except for the New I-64/40, will be delayed because (according to the Post-Dispatch, via Combest):

Ed Hassinger, the Missouri Department of Transportation’s district engineer for St. Louis, said a triple whammy of higher bond payments, a looming deficit in the federal highway Trust Fund and dropping state fuel tax revenue would reduce the number of dollars available to build roads and bridges.

I sure wish a Missouri-based, free-market think tank had written a study about ways to fund and operate needed road, bridge, and transit projects using innovative solutions (public-private partnerships) and user-based fees (tolls) to fund transportation in Missouri. That might come in handy right now. …

Popular Textbook Pricing Bill’s Faults Revisited

Posted on by Dan Grana

The proposed Textbook Transparency Act hopes to reduce seemingly exorbitant prices to students by mandating that publishers and bookstores provide a wealth of extra information about their books, and restricting their ability to bundle individual items for sale. Although our skepticism has been explained, the Missouri bill’s strong chances of success and the national momentum behind similar legislation warrant further consideration of this issue.

My fellow critics have described how mandated information sharing will fail to effect any change for all but the least discriminating consumers (those who don’t check prices online). Also, the potential abuses of a tuition-funded book purchasing system are glaringly obvious. They rightly suggest that communication costs between producers and bookstores, especially regarding bundling, would necessarily increase prices to students.

The simple fact is that textbook authors enjoy an intellectual monopoly. The tremendous input costs of time and expertise, coupled with the overwhelming risk that a new book will not replace the existing standard, afford successful authors handsome payoffs. Textbook bundling is simply a tactic employed to partially reconcile monopolistic prices with what consumers think is fair. If Missouri lawmakers take away this option, producers will have little trouble reclaiming their lost profits elsewhere. In fact, more common than bundles are supplementary software packages and personalized website codes sold alongside lone textbooks. At the end of the day, authors of quality textbooks could always resort to overt price increases without facing much penalty from eagerly subscribing professors.

Only one provision of the act, the ineffectual mandated information bit, addresses the bookselling practice most widely begrudged among college students — the seemingly unnecessary and frustratingly frequent release of new editions. I can hardly think of a more potent insult to a room full of economics majors than to deny them aftermarket prices on their textbooks so that they can receive essentially the same product, now with four font colors. But then, legislation cannot (and should not) decide for authors when it’s appropriate to revise their works.

In the end, successful authors deserve proper reimbursement for providing a superior resource. As the chances of the Textbook Transparency Act’s passage grow, Missouri lawmakers should reevaluate the practical inefficiencies of such a bill. Outraged students and parents should join them in analyzing how supply and demand account for the allegedly unfair prices, realizing that those prices are in no way connected to any frustrations that they might have with other costs of education.

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