I’ve been resisting the pre-filed bill list, but my self-control goes only so far. Does anybody really think unaccredited districts are failing because the students don’t all dress alike? State Sen. Smith thinks so. But his proposal to allow higher pay for math and science teachers is a better idea, if I do say so myself.
Rewarding Kids
Here’s a public-private partnership not everyone is happy about. A Florida school district is teaming up with McDonald’s to reward good grades and attendance with Happy Meals. During the school year, information about students’ grades is sent home to parents in McDonald’s-themed folders. One critic is appalled:
“It’s a terribly troubling trend,” Ms. Linn said, because “it really, clearly links doing well in school with getting a Happy Meal.”
Well, yeah, it does. I don’t feel the need to get up in arms about this, but I can see how the program could annoy parents. Some people don’t eat at McDonald’s because of health reasons, beliefs in strict vegetarianism, or dietary restrictions imposed by any of several religions. Parents who fall into those categories don’t want to see a McDonald’s ad with every report card or to have to explain to their kids for the millionth time, "No, we can’t go get a Happy Meal like all your friends do."
An obvious solution is to offer rewards that don’t involve food. In some schools in Missouri, kids get to go to a Cardinals game as a reward for good grades. Bookstores could reward kids with a paperback novel, and kids might even read it and learn something.
If I were a parent in the McDonald’s school district (just kidding, it’s actually called the Seminole County School District) I would probably ask the company to donate the $3 or so that a Happy Meal costs to the Ronald McDonald House Charities. That way you avoid Happy Meals and teach your kids about helping others at the same time.
A general policy lesson to learn from this controversy is that involving private organizations in public education is great, but it works better if you let parents make a choice. That goes for big things like choosing schools or curricula, but it’s also important for little things like rewarding good grades. There’s no reason everyone needs to get the same reward. If you offer a few different options, parents will be just as happy as the kids.
Changes to Property Assessment System Would Improve Fairness
Like a more frequent, less welcome, and much more expensive Halley’s Comet, property reassessment returned to Missouri this year. As the suburbs have expanded, complaints formerly confined to Saint Louis and Jackson counties have moved into adjoining counties, giving the reassessment issue more focus for many legislators. The Speaker of the House has appointed a task force on the issue, scheduled to issue a report later this year. What should Missouri do, if anything, about its assessment system?
The problem is not with the use of property taxes to fund local governments. The problem lies in the seemingly arbitrary way in which assessments are set, which leads to a lack of public faith in the property tax system’s fairness in Missouri’s larger and faster-growing counties.
Until recently, this problem has been confined to Missouri’s two largest counties, with their appointed, professional assessors and computer-based systems. Because of the obvious factors of human nature and political survival, elected assessors in rural Missouri have not increased their appraisals as rapidly — or as accurately. This is a serious issue in cases where taxing districts cross county lines. For years, the underassessed residents of Saint Louis city paid less than they should have to the taxing districts they shared with Saint Louis County, such as the Zoo-Museum District.
For better or worse, depending on your perspective, the assessments in Saint Louis city have become more accurate, and consequently higher, during the past few cycles. These problems have now moved to the extended suburbs, with dramatic assessment differences between older homes and brand-new developments.
Missouri should eliminate the practice of sending hundreds of assessors out into our neighborhoods every other year to assess property. In the current system, each county assessor uses the comparative sales method to assess every home in the county. The county’s average rate of increase is realized only after all the homes are reassessed. I believe the process should be reversed.
Jordan Rappaport, an economist with the Federal Reserve Bank of Kansas City, wrote an article, “A Guide to Aggregate House Price Measures,” for his institution’s second-quarter 2007 Economic Review, which reviewed the various nationwide housing price indices. This article could serve as a starting point for the Missouri State Tax Commission, working with county assessors and local realtors, to determine average county increases (or decreases) in valuation for each reassessment cycle.
Each residential, commercial, or agricultural property in a county could then be adjusted based on the county’s average for that particular class of property. This would eliminate wide discrepancies from house to house that undermine faith in the current system. These individual discrepancies are common even in places where the aggregate accuracy of the assessments is high, such as Saint Louis County. Furthermore, the savings from no longer paying so many assessors would be substantial.
The appeal process should be maintained, to allow property owners who believe the real value of their property is less than the average increase to have an opportunity to reduce their assessment. For the commercial property classification, which is more complicated than the residential classification to assess, counties could be allowed to continue their current systems.
When a house is sold or refinanced, the assessment should continue to be set at the exact sales price. This would safeguard against incorrectly undervaluing properties — particularly expensive ones — which might be underassessed over time by the use of an average-based system.
Missouri is one of a handful of states that does not require certificates of value to be filed with a county recorder upon sale of real estate. Currently, these certificates are only required, by local ordinance, in four of Missouri’s larger counties. Certificates of value should be required with the sale of all property statewide, because only they guarantee that the most accurate information market forces provide are entered into the assessment system throughout Missouri.
If we are going to have a system of taxes based upon property assessments, we must give local officials the ability to accurately assess property. In order to address the privacy concerns of those opposed to mandatory certificates of value, the information need not be made available to the general public — but it must be available to the local assessor.
These changes would dramatically alter the assessment system in Missouri. I believe they would improve the fairness — both perceived and applied — of the overall system, while maintaining, and in many places improving, its accuracy.
David Stokes is a policy analyst at the Show-Me Institute, a Missouri-based think tank.
Talking About Parental Choice
Edspresso links today to an article on charter schools in Wisconsin. There are some great quotes here about the diversity school choice allows. For example, a history teacher discusses public high school:
"Public high school education was devised in the late 1800s to prepare students for factory jobs," Hagerman said. "It’s been difficult to change that, and we’re finally doing it. This acknowledges that students are not all the same.
"It’s refreshing and it’s wonderful."
And a district administrator comments on how parental choice expands opportunities that were once available only to a wealthy few:
"But a core group of parents has been school-shopping for years. This puts ownership on them. It’s a paradigm shift. For a long time, the concept of school choice was only for families with the financial means to do it."
I think that first quote may be going a bit too far — some early proponents of public education had worthwhile goals like spreading literacy, not just preparing factory workers — but she makes a good point that today’s education system should take account of students’ individuality. Although a standard neighborhood public school was all that was feasible in the 19th century, we now have the resources and technology to offer online courses, charter schools specializing in any of dozens of subjects, and partnerships with nonprofit and for-profit schools. There’s no reason to stick with the one-public-school-per-neighborhood model when educational options are multiplying in the private sector.
The Show-Me Institute Really Is Non-Partisan; Here’s the Proof …
Man, oh man, this is gonna get me in trouble in the circles I run in. But intellectual honesty demands that I commend Senator Claire McCaskill for refusing to use earmarks in the budget process. Via Prime Buzz in the Kansas City Star, CBS News had a recent story on Senator McCaskill and earmarks. From the story:
“I am one of 12 U.S. senators who’ve not requested earmarks,” she said. “One of only two Democrats.”
From the teapot museum to wine budgets, earmarks are pet projects that get special funding from individual members of Congress – often without a public vote or scrutiny – and are attached to budget bills that have to be passed.
Now, proponents of the "liberal media conspiracy" theory might very rightly wonder why CBS did this story on a Democrat if 10 of the 12 senators not using earmarks are Republicans, but that does not change the fact that McCaskill deserves great credit for her firm position against earmarks. I know that Senator Coburn from Oklahoma has been a real leader on this issue, as well, but I am getting too political here. So good job, Senator McCaskill! (File that under "words I never thought I would write.")
Pre-Filed Bill Excitement Spreads Among Nerds, Hacks …
Count me in as the latter, but I assure you I am at least a reputable hack. Political Fix has gotten in on the pre-filed bill review act, so I know I am in good company with my latest posts. I have reviewed all of the bills (at least the brief summaries) filed so far, with thousands yet to come, and I have been pleasantly surprised at the lack of outright horrible bills. This is probably because the really bad ones always have harmless sounding titles, like a "Make Missouri Better" act that will raise the state income tax rate to 78 percent and make all policy analysts apply for a state license. Or maybe the bad ones intentionally come as late as possible?
Here is a great bill. Senator Bartle has again introduced a bill allowing toll roads in Missouri. This will require a vote of the people, because that’s always the case when amending the Constitution. (If I were of a different mindset, this would be the perfect place to insert some crap like, "except under the current administration" and calling for the impeachment of Bush /Cheney, but that ain’t me.)
With transportation being such a serious issue right now, perhaps this will finally be the year this change passes, and people realize that we can meet our mobility and movement needs by making the people who use a new asset pay for that new asset. I commend Senator Bartle for this proposal, and I look forward to discussing it much further in session.
Pre-Filed Bills to Dominate Blogging, Commentary, Life …
Like an early Christmas for bloggers here at the Show-Me Institute, the swallows have returned to Jefferson City in the form of pre-filed legislative bills. My writing here for the next month will be the bloggy equivalent of shooting fish in a barrel — which may or may not be legalized by pending legislation. (One can always hope.)
I look forward to attempting to imitate former Senator Clifford Jones, who was famous for reading every bill filed each year. I am not actually going to read all the bills, but I will use the state’s online search engine to read all the bills that come up after I set a few filters, which is close enough. I must be careful not to violate tax rules by advocating here that legislators vote for or against specific bills, so these posts will be more along the lines of, "this is a fine idea," or — much more likely — "this is so unbelieveably stupid."
Bills that expand or grow government, increase the welfare state, add licensure requirements to more professions, or raise taxes without a clear purpose will come in for both scholarly refutation and juvenile mockery. Bills that increase our freedoms and limit government’s role in the economy shall be lavishly heaped with praise like a Veiled Prophet Queen on her wedding day.
Let’s get started. From the Springfield News-Leader comes word that a bill has been filed to repeal the controversial village ordinance passed at the end of the last session. The last thing Missouri needs is more small municipalitites and more separate local governments. Furthermore, it should be difficult to form a new city, or village, or galactic empire. Representative Wood has filed two bills on this subject, and I think they are both worthwhile and positive.
In Defense of Ticket Scalping
In the comments to a South East Missourian editorial, somebody who calls himself (or herself) "trimetrov" asks:
There are no "bargains" in scalping – how is paying MORE than face value ever a bargain??
If people wanted to sit behind home plate, they would have paid for it beforehand, not for more money later…except that the ticket brokers already bought all the seats.
Allow me to address this challenge. This writer posits that the people paying more for tickets through a third party are the same people who would have, had they had the chance, bought them at the original price when they were first sold. I don’t think that’s the case. Ticket brokers aren’t the only ones who want to make money — stadiums want to make money too. If fans were willing to pay a higher price from the start, the tickets would have been given a higher face value. You could argue that the original seller couldn’t price-discriminate, and now ticket-brokers come in and make a profit from charging different prices to different consumers. But that doesn’t make sense either, because stadiums already offer tickets for different seats at a range of prices.
If, on the day of a game, no one is willing to sell a ticket for face value, paying more than face value may indeed be a bargain. I would rather pay twice the face value from a reliable ticket broker than three times the face value from a fan.
Columbia School District Should Abandon Frivolous Lawsuit
To date, Columbia Public Schools has spent roughly $82,000 on the “adequacy” lawsuit, despite the fact it is a no-win venture for the community. Several other plaintiff schools have come to a similar conclusion and have declined to join the appeal. CPS should do the same.
The plaintiff school districts are spending tax dollars to hire private law firms to sue the Legislature — i.e., us — and the attorney general’s office has used tax dollars to hire a private law firm to defend the Legislature. The cost so far, just for private law firms, is more than $4.6 million, and that does not count the time of the attorney general’s staff lawyers or the court. I find it remarkable that some members of our school board think this is an appropriate way to spend education revenues. During the 10 years I spent as chairman of the University of Missouri–Columbia Economics Department, it never occurred to me it would be acceptable to use some of my department budget to sue the Legislature for more money, even though MU is also mentioned in the Missouri Constitution.
Issues of propriety aside, let us turn to some specific reasons I believe CPS is ill-advised to continue its participation in this lawsuit.
First, it would be difficult for the plaintiffs to have lost this case more completely. Judge Richard Callahan’s decision is clear, concise, and logical. The “adequacy” aspect of the lawsuit was based on the Missouri Constitution’s requirement for free public schools and the stipulation that the Legislature must devote at least 25 percent of revenues to that end. Judge Callahan ruled both requirements are being met easily. The plaintiffs asked the judge to read something into the state Constitution that is not there, and this he refused to do. Of course, the notion that a given level of spending can be reliably associated with a given level of MAP achievement — “adequacy” — was never established by the plaintiffs because it is statistically impossible to do so, a point made repeatedly by the three economists, including myself, who testified for the defense.
Second, as the magnitude of this defeat becomes more widely recognized, the “tax base” of paying plaintiff districts is shrinking. Some major districts have publicly dropped out of the case, including St. Joseph, Liberty, and Francis Howell. More are expected to follow. As the number of participating districts falls, Columbia Public Schools and Columbia taxpayers will be left to bear a larger share of the litigation bill. That might make narrow sense if there were reason to believe that, ultimately, there is something in this for Columbia, but that is the biggest folly of all.
Let’s begin with the “equity” issue. Under the current system, CPS fares well. We are a relatively wealthy district that enrolls 1.5 percent of Missouri public school students, yet receives 1.7 percent of state K-12 funding. Our per-pupil spending is higher than the state average. What can CPS hope to gain in an “equity” lawsuit? Is a Cole County judge likely to find Columbia schools relatively impoverished?
Now, let us consider “adequacy” — the argument that almost all districts are underfunded. The plaintiffs are asking for roughly $1 billion in additional state funds for K-12 education. If they are successful and the Supreme Court tells the Legislature it must spend $1 billion more on public education, that money must be found somewhere in the state budget. Given the Hancock limits on raising taxes, we must ask lawsuit proponents where they propose to obtain these additional funds for K-12 education.
With tax increases off the table, K-12 gains must come at the expense of the rest of the state budget. One billion dollars more for K-12 implies a 21-percent cut in spending for the non-K-12 budget. Assuming those cuts are across the board, the MU budget would be cut by 21 percent as well, in which case MU would lose more than the entire state funding of CPS. Whatever the size of the boost in K-12 spending, every dollar CPS would gain through this litigation implies at least a $2.25 cut in the MU budget. This assumes Medicaid is subjected to the 21-percent cut. If Medicaid escapes the across-the-board cut, the MU loss is even larger.
Along with making higher education even less affordable, a plaintiff victory must lead to cuts in a wide range of state-provided social services. The primary recipients of those programs, poor families and children, would end up worse off. We elect legislators to make these difficult spending decisions and to balance the complicated tradeoffs. That is not the job of our courts.
The most likely outcome of the appeal is that CPS simply will have wasted tax dollars on frivolous litigation. Our school board, however, is playing with fire. In the remote chance the plaintiffs win on appeal, the broader Columbia community might well be seriously harmed because of large cuts to the MU budget. It is time to stop participating in this nonsense and spend our education tax dollars on education — and not on $250-an-hour legal fees.
Michael Podgursky is a professor of economics at the University of Missouri–Columbia and a member of the Show-Me Institute board of directors.
