Independence has struggled to maintain its own power generation as the environmental and financial costs of coal plants has [sic] pushed many other energy firms into renewables. While many say IPL provides exceptional service and reliability, city officials note that their customers pay higher electricity rates than those served by for-profit companies in other parts of the region.

The utility is also facing financial headwinds: Its cash reserves will drop below the utility’s target of $25 million by 2025, officials said. And those reserves will drop to a negative $97 million by June 2032 as the costs to maintain the utility’s infrastructure mount.

“The problem we have, as we sit here today is that IPL is on a course to a financial train wreck, due to what I believe to be questionable decisions in the past,” said Councilman Jared Fears. “So clearly something has to change.”

It bears repeating that Independence utility customers pay more than those using for-profit utilities in the region. This is despite the advantages in taxation and regulation that municipal utilities have over private utilities. There have been several water utility privatizations in Missouri in recent years, but not many electrical utility privatizations. The case for electrical privatization is probably even stronger, as one does not have to deal with the typical “how do you privatize something that falls from the sky?” argument. Unless you make extensive use of your home lightning rod, someone is artificially generating the electricity you use. Eureka and Arnold are just two of the larger cities that have privatized their water or sewer systems in recent years. From the Post-Dispatch story:

Arnold sold its sewer system to Missouri American in 2015 for $21 million. “The system was not in good shape. It was not well maintained,” said City Administrator Bryan Richison. “And city council members were running on not raising rates, so it put us in a bad position.”

As electric vehicles ramp up the electrical power needs of our communities, it is time for Independence, Columbia, Kirkwood, and (most of all) Springfield to get out of the utility business. Private, regulated utilities are much better positioned to provide the necessary services to these communities. These cities should privatize their assets via an open, transparent process and use both the sale price and the future tax revenues to provide better overall public services for their communities.

The post Prudent Pundit Ponders Independence Power Privatization Proposal appeared first on Show-Me Institute.

These privatization deals are a wonderful thing that should be encouraged and expanded in Missouri, including for our largest cities and their water divisions. More stringent health, environmental, and other regulations (both necessary and not) are making it harder for local communities to operate their water and sewer systems properly. The Post-Dispatch article mentions right at the start how bad the water in Eureka is currently: “It’s the worst water I’ve ever tasted in my life,’ said Eureka resident Thomas Ferrari.”

The main complaint about privatization is that rates will increase. Yes, they often do, and that is typically a necessary thing. Municipal utilities frequently underprice water, electric, and gas rates because those pricing decisions are made by politicians who want to keep voters happy. That may help with re-election, but it makes necessary system investments more difficult. From the Post-Dispatch story:

Arnold sold its sewer system to Missouri American in 2015 for $21 million. “The system was not in good shape. It was not well maintained,” said City Administrator Bryan Richison. “And city council members were running on not raising rates, so it put us in a bad position.”

The water in the City of St. Louis may taste great (it does), but the city water division there has done a poor job of reinvesting in its system and incorporating new technology into service. As astounding as it may be, the City of St. Louis water division has still never installed water meters in most homes to measure water usage and bill accordingly. You get charged for water based on a variety of physical factors, so if you want to water your lawn for 12 hours a day you pay no more than your neighbors. That’s terrible public policy and results in inefficient, wasteful use of water.

Water and wastewater privatization is very good public policy that we need more of in Missouri. Private utilities adopt technology more quickly, expand the tax base, invest in their systems more reliably, and are regulated by the state’s public service commission on their rates. More municipalities with their own water, electric, and gas utilities should follow Eureka and Arnold’s lead and privatize for everyone’s benefit.

The post Eureka Water Privatization Is a Very Good Thing appeared first on Show-Me Institute.

However, what if you’re among the more than 10,000 residents who feel that Columbia needs a bit more in the way of police and fire protection? I’d say don’t despair. There are other means by which the city can increase revenues without resorting to a property tax increase.

For instance, the city could look at the fire expense reimbursement that it receives for services that it performs for the three colleges located in town. According to the Columbia budget, these reimbursements are declining and have been for the past couple of years. Columbia can renegotiate with these colleges in order to get higher reimbursements.

Columbia also could look into privatizing its water and electric utilities. The sale of these types of utilities can bring in an immediate infusion of cash to cities’ bank accounts. For example, the city of Florissant, Missouri, privatized its water utility in 2002 and received $14.5 million from the sale. More recently, the residents of Arnold approved the sale of their sewer system, which brought the city $13.2 million. Not only can the sale of the utilities themselves bring in more money to the city, but privatization can also expand the city’s property tax base, which would generate more revenue in the future.

The instances of crime and fire have declined in Columbia, yet for those who believe that public safety is underfunded, there are other ways to raise revenue besides a tax increase. Maybe it’s time they explore them.

The post Proposed Property Tax Increase Fails in Columbia appeared first on Show-Me Institute.

Over the last couple months, we have written how privatizing the wastewater treatment facilities will be able to leverage the expertise and capital available in the private sector to provide better services and keep prices down. The sale price, $13.2 million, can be spent to retire debt and to create a rainy-day fund.

But as with all privatizations, effecting a sale should not be the end of public engagement. Arnold residents must ensure that the money from the sale is spent or saved in a wise manner. They also must ensure that city officials hold the private company, Missouri American Water, responsible for providing safe and efficient services.

Should the city be diligent in these areas, the privatization of Arnold’s sewer system has the opportunity to become an example to Missouri of how water treatment, like many public services, can be effectively provided through the private sector.

The post Arnold Residents Vote to Privatize Sewer System appeared first on Show-Me Institute.

According to a report issued by MDNR, upgrading the state’s wastewater treatment plants to meet strict federal standards will cost between $430 million on the low end and $1.2 billion on the high end. However, most municipalities did not set high enough utility fees to cover the cost of regular improvement projects when regulation was more lenient. With the cost of needed upgrades now looming, localities will be forced to find more funds, which means wastewater utility rates, or other forms of local taxation, are likely to increase statewide in the near future.

Conforming to higher water quality standards in the most economical manner possible has pushed many municipalities across the nation and in Missouri to privatize their water utilities. Cities usually receive an upfront payment for leasing these systems, and while the private owners often raise rates, the increase is usually less than what the public utilities planned to do absent of privatization.

The city of Arnold in Jefferson County is considering just such a privatization plan partially in response to these types of costs. We have written before how this deal can benefit Arnold financially, and should it succeed, the privatization plan could become a model for other municipalities as they decide how to deal with increasing regulatory burdens for water treatment.

The post Cost of Compliance to Rise for Missouri Wastewater Treatment appeared first on Show-Me Institute.

Believe it or not, the same may be said of the sewers serving the 20,000-plus residents of Arnold, Missouri, located on the southern edge of the Saint Louis Metropolitan Area at the confluence of the Meramec and Mississippi rivers.

Missouri American Water has offered to purchase the Arnold sewer system for a total of $13.2 million. This is a win-win proposition for the city and its residents.

The deal not only would provide Arnold with the funds to pay off $8 million in sewer bonds, but it also would supply $5 million in additional revenue. At the same time, the arrangement with Missouri American Water would guarantee timely improvements to the sewer system and lower utility costs for residents.

Arnold currently operates its sewer system as a public utility and charges residents $24.33 per month for up to 5,000 gallons of wastewater. However, like many municipalities around the country, Arnold is not charging residents what it needs to keep the system up to date, especially with increasingly stringent EPA and Clean Water Act requirements coming into force. According to one report, by 2016 the city would need to charge $34.50 per month to provide the same services.

Facing very similar pressures, cities across the country have turned to partial or full privatization of their water and wastewater systems. Deals with private companies typically result in an upfront payment to the city, a commitment by the company to make investments in the water or sewer system, agreement on pricing, and often a stipulation that the private company must retain the existing utility staff. The vast majority of these privatizations have been successful, with more than 90 percent of cities renewing privatization contracts and 94 percent recommending privatization as a method of water and sewer system management.

To cite one example, the city of Florissant in Saint Louis County sold its municipal water utility to Missouri American Water for $14.5 million in 2002. The city spent part of the proceeds on immediate needs and put the rest in a reserve fund. More than a decade later, the privatization is still a success. The lesson from Florissant and other cities is clear: When governments set the standards and carefully manage the privatization process, private operators deliver better, cost-effective service.

If Arnold accepts the deal with Missouri American, it will reap other benefits as well. Public services, like the school district, will benefit from this proposal via the expansion of the property tax base when the assets of the sewer system go on the tax rolls after Missouri American takes control. Residents will benefit from low utility fees, as Missouri American Water has stated that they will not increase rates until 2016. Even after that date, they project they will only charge residents $30 a month, which is less than what the city is likely to charge absent privatization.

While privatization of the sewer system makes sense, Arnold must be cautious on how it crafts and implements a final deal. The city must hold Missouri American Water accountable for the quality of service and the implementation of agreed-upon improvements. Furthermore, Arnold would be wise to follow the example of Florissant by carefully spending its windfall profits.

As long as local officials perform their due diligence, Arnold has much to gain and little to lose from privatizing its sewer system. Come November, residents should not let this opportunity slip down the drain.

The post Arnold Wastewater Privatization: Don’t Waste the Opportunity appeared first on Show-Me Institute.

Criticism: Privatized water systems mean higher rates for residents. Many cities that have privatized water or sewer systems, including Florissant, Missouri, have seen rates rise, usually faster than inflation.

Proponent response: Wastewater and water system privatizations often occur because cities are faced with expensive, necessary upgrades to sewer infrastructure. Cities that charge a utilities fee that is too low to generate enough funds for large upgrades are forced to decide between a large tax increase or subsidies from the general fund. In the case of Arnold, the city claims it will have to increase rates should privatization not occur. Luckily, Missouri American Water reports that its rate increases will be less than those the city would implement, even with necessary capital improvements.

Criticism: Cities are selling city assets in order to receive short-term cash infusions. This short-term gain will result in high utility fees in the long-term.

Proponent response: Just because cities could spend sales money foolishly, does not mean they will do so. In Florissant, the city spent a portion of the sales proceeds on immediate needs and put $10 million in a rainy day fund. Arnold plans to use proceeds to pay off existing debt, but beyond that residents should ensure that the city does not spend wastefully.

Criticism: Some cities with privatized water systems have seen the drinking water become unsafe. Companies looking to make a profit might cut corners and provide lower service.

Proponent response: Private water and wastewater management has a proven track record in the United States. The vast majority of municipalities that privatize their water or wastewater system end up renewing the contract. Like municipally owned water utilities, in individual cases private companies fail to meet safety standards, but this is not the norm. Also, the issue of water quality is less important under a wastewater system privatization than a water system privatization, for obvious reasons.

The residents of Arnold should carefully consider these questions surrounding the planned wastewater privatization deal, and whether both the funds the city will receive and benefits of private management outweigh the risks of selling a public asset.

The post Arnold Wastewater Privatization: The Policy Breakdown appeared first on Show-Me Institute.

“It was clear that not enough assurances could be provided to ensure the protection of the City’s residents or the City employees who were proposed to join American Water,” [Arnold Mayor Ron] Counts said in a news release on Friday afternoon.

Any city should consider the costs of a decision, and I am glad that Arnold took the time to analyze those costs before making a decision. However, I believe there are benefits which may outweigh the costs. Should the city ever again be presented with the opportunity to sell its sewers, I hope city officials will fully consider the advantages of privatization. Here are a few examples from an op-ed that I wrote on the topic, untimely published five days after the decision not to sell (untimely due to bad luck, not a lack of effort):

1. Arnold’s sewers are in dire straits. The city would face less of a financial difficulty if it relied on private capital to fund renovations and repairs.
2. Private ownership leads to more efficient uses of labor and capital. Privatization can produce savings relative to bureaucratic management.
3. The city of Arnold would obtain monetary benefits from the sale. When Florissant sold its water utility in 2002, it was able to establish a $10 million reserve fund. Arnold could use the revenue to establish its own reserve fund, pay down debt, or lower taxes.

For more Show-Me Institute commentary on privatization, click here.

The post Clutching the Sewers: The Foul Smell of a Missed Opportunity appeared first on Show-Me Institute.

First, the city could raise a large amount of money through the sale of its sewer system — possibly millions of dollars. This could be used to pay down debt, invest in needed public services, or lower taxes. The city of Florissant used the revenue from the 2002 sale of its water utility to finance several public improvements and establish a $10 million reserve fund.

Second, privatization would turn the sewers into a taxable asset. This means additional revenue for the municipality, possibly easing the tax burden on existing residents and businesses.

Third, privatization often results in lower costs, higher efficiency, and better service. For instance, Oklahoma City partnered with Veolia Water for wastewater treatment in 1984, and by 2001 had reduced treatment plant costs from $14 million to $11 million dollars. As long as efficiency gains such as those in Oklahoma City are passed on to consumers, lower costs can lead to customer savings. And although government regulations tend to erode efficiency gains over time, the immediate benefits should not be ignored. 

Make no mistake: Arnold’s wastewater system is aged and in need of extensive overhaul and repair. Privatization will not change that. Over the next few years, a significant portion of the sewer system will reach the end of its usable life. When this happens, significant costs will be incurred to renovate the system. These costs will occur whether or not the sewer system is privatized, but privatization could help keep renovation costs as low as possible. Sewer user-fees have gone up twice in the last three years – and that is with government ownership of the system. 

Private utility ownership is common throughout Missouri. In neighboring Saint Louis County, almost every resident purchases water, gas, and electricity from private companies. Although sewer privatization is less common, it is not unheard of; Missouri American Water, for instance, has several thousand sewer system customers throughout the state. 

The possibility of public repossession of the sewer system is an important option to remember. In the sale contract, Arnold can reserve the right to take the sewers back if certain standards are not met. Such a provision can protect residents from the danger of quality degradation and monopolistic fees. Another protection is the Missouri Public Service Commission, which regulates fees charged by private utility companies.

Arnold’s privatization option appears to be an opportunity for comparatively lower sewer rates and additional city revenue. The city will have more money, sewer costs will be handled more efficiently, and any concern about the quality and price of service can be addressed in the sale contract. Selling the sewers appears to be a situation where both the government and the people it serves can benefit.

Bruce Stahl is a research assistant at the Show-Me Institute, which promotes market solutions for Missouri public policy.

The post Selling the Sewers: The Sweet Smell of Success appeared first on Show-Me Institute.

Motorists driving along roadways maintained by the Missouri Department of Transportation could receive fewer red-light camera tickets if preliminary reports from Arnold ring true statewide.

Beginning in February, MoDOT began changing the yellow-light signal times throughout Arnold, where all the city’s red-light cameras happen to be along state-controlled roads. In general, the change to the signals has lengthened the amount of time for yellow lights.

For example, motorists traveling southbound through the intersection of Highway 141 and Astra Way now have 1.6 seconds more yellow time — from 4 seconds to 5.6 seconds. MoDOT has also changed the length of time that all signals at an intersection appear red, generally giving intersections a bit more time to clear all cars before changing lights.

In so doing, Arnold has experienced an unintended consequence — the number of red-light runners has plummeted since MoDOT made the changes.

In January, the city issued 691 red-light camera citations, according to information obtained from a city council member. By March, the number of citations had dropped to 263. Last month, the vendor that operates Arnold’s red-light cameras — American Traffic Solutions — confirms that it issued just 198 citations. That’s a drop of 72 percent from the number of citations issued in January.

The Show-Me Institute has a long history of opposing red light cameras, particularly given the cameras’ questionable effectiveness in preventing accidents yet prodigious aptitude for raising money for cities. Lately, though, Missouri’s red light camera industry has been traversing rocky judicial and legislative roads. Earlier this month, policy analyst David Stokes astutely reviewed one court ruling in Saint Louis that could very well cripple the use of red light camera systems in the city. His analysis:

It will probably take an act of the legislature to declare unequivocally that red light camera programs are invalid as a matter of state law, but the red light camera issue may, for all practical purposes, be resolved by adjusting the signals where the cameras sit. The roads in Missouri may be getting a great deal safer, just by adding a little more time to yellow lights — a simple, nearly costless solution to an important issue of public safety.

Cities must be elated. After all, “safety” was the driving purpose behind their use of these cameras anyway, right?

Right?

The post Could a Longer Yellow Mean Less Green in City Coffers? appeared first on Show-Me Institute.

For decades, the property rights of Missouri residents have been disregarded as municipalities throughout the state plowed through personal history in the disastrous pursuit of progress. Recently, the state’s highest court had a chance to correct this wrong and restore a sense of safety to the minds of Missouri’s home and business owners. However, the court neglected this opportunity by turning in a terrible decision that served nothing more than the status quo, and acted as reaffirmation of an invasive trend that should worry every property owner.

On March 18, the Missouri Supreme Court handed down a 6-1 decision in favor of “development” trumping property rights in the matter of City of Arnold v. Homer Tourkakis. Dr. Tourkakis, a dentist who has been practicing in Arnold for more than 20 years, was threatened with the loss of his office when the city sought to acquire land through the use of eminent domain for the new Arnold Commons shopping center. Had the city needed to exercise this power for a legitimate public use, Dr. Tourkakis’ might have understood the property invasion. However, the idea of Arnold subverting this constitutional power to forcefully transfer property from one private party to another was enough not only for Tourkakis to reject the city’s offer, but to seek relief from the highest court in the state.

Arnold v. Tourkakis was a rare opportunity for Missouri to protect the individual rights of citizens, and emphatically stamp out an unjust abuse of municipal power. The court could have reassured citizens that the homes they worked to build would always be their castles, and that the businesses they labored to run would be free from unjust interference.

Instead, the court found in favor of the city — and watched that chance sail by.

According to the decision, Arnold is justified in using the power of eminent domain to seize Tourkakis’ property (which had been blocked off by surrounding construction for more than a year). This decision overturned a prior ruling by a state trial court because, according to the opinion authored by Judge Mary Russell, “The trial court erred … in dismissing the City’s condemnation action. The City is authorized under several statutes … to exercise eminent domain.”

These words have struck a blow against the property rights of every Missourian. In the past few weeks, property owners in the Liberty and Sugar Creek townships near Kansas City have been forced to face the sad reality that their homes may be lawfully seized for private development. Meanwhile, across the state, as homeowners in Valley Park begin to pull sandbags away from the flooded Meramec River, they must wonder whether the homes they worked so hard to protect might similarly be taken away — a threat they faced in November.

Thankfully, though, there is still hope. The Court failed to rule on the controversial nature of Missouri’s “blight” definition, which has allowed municipalities in the past to condemn pristine areas and doom them to economic failure. Also, as highlighted by Judge Teitelman in the lone dissent to the majority opinion, the section of Missouri’s Constitution that ostensibly authorizes Arnold to wield the power of eminent domain “does not expressly authorize the wholesale delegation of such power to third-class cities” — a class that the city of Arnold falls under.

However, the few glimmers of hope that still exist for the case do not make up for the fact that Tourkakis will almost certainly lose his office, and that any orthopedist in Joplin or homeowner in Chesterfield has lost a chance to protect the property that is rightfully theirs. If Missouri citizens will ever feel completely secure about the fact that their homes are their castles, they first need to accept that the status quo will continue with every decision made by the judiciary and legislature. Only the efforts of citizens, working within their rights to correct this problem, will foster necessary progress. We should hope that these efforts succeed, and — for all our sakes — that it happens soon.

Nicholas A. Loyal is an intern at the Show-Me Institute, a Missouri-based think tank. He will begin a graduate program at the University of Missouri School of Law this fall.

The post Court’s Eminent Domain Ruling Endangers Property Rights appeared first on Show-Me Institute.

During the five years between December 2002 and November 2007, dozens of cities acting without a constitutional charter used bogus blight designations to threaten the use of eminent domain against more than 1,500 properties. Facing the threat of condemnation, many owners reluctantly sold their homes and businesses for less than they were worth.

The Missouri Bill of Rights contains some of the strongest property rights protections in the entire nation, said Jenifer Roland, the Show-Me Institute’s director of policy and a nationally respected expert in eminent domain law. It is appalling that this state’s cities have been given so much leeway to trample on their citizens’ freedoms.

Dr. Homer Tourkakis, a dentist who has practiced in Arnold, Mo., for two decades, chose to fight for his constitutional rights rather than accept a low-ball offer for his business. His resistance was vindicated last year when a judge ruled that the Missouri Constitution does not permit cities like Arnold to take properties based on claims of blight.

The Show-Me Institute submitted a brief to the Missouri Supreme Court in support of Dr. Tourkakis, arguing that the Court should stem the tide of eminent domain abuse by enforcing constitutional limitations on government authority to take citizens properties.

The Missouri Supreme Court has a golden opportunity to do the right thing by affirming the Constitution’s emphatic protection of individual liberties, said Dave Roland, a policy analyst for the Show-Me Institute. A proper decision from the Court will reassure Missourians that they have a right to keep what belongs to them.

Related Links:

Show-Me Institute’s Brief of Amicus Curiae

Op-Ed: Will the Missouri Supreme Court Leave Your Home At Risk?

Policy Study: The Specter of Condemnation: The Case Against Eminent Domain for Private Profit in Missouri

Missouri’s Eminent Domain Report Card (issued by the Castle Coalition and authored by Jenifer Zeigler Roland)

Previous Reports on Eminent Domain Abuse in Missouri:
Public Power, Private Gain: Missouri
Opening the Floodgates: Missouri

Live Streaming Audio of the City of Arnold v. Tourkakis Oral Argument (available Thursday from 9:30 – 10:15 a.m.)

The post Missouri Supreme Court to Decide Whether Cities May Continue to Abuse Eminent Domain appeared first on Show-Me Institute.

As part of the discussion, St. Louis Mayor Francis Slay’s chief of staff, Jeff Rainford, claimed the study had two factual errors. (We are not going to even get into his contention that this is an opinion piece, rather than a study. Go read it and decide for yourself.) Rainford erroneously stated that Tim Lee, a co-author of the study, wrote that eminent domain was used in Gaslight Square in order to increase sales taxes. Having rechecked the study, I found absolutely no mention of sales taxes anywhere in the Gaslight Square section (pages 21-22). While Dr. Erondu in Gaslight Square is mentioned as part of a discussion of tax revenues on page 19, the study never states that the Gaslight Square eminent domain program was used for the purpose of sales taxes. Dr. Erondu was included because he, like Dr. Tourkakis in Arnold, is a dentist, and Dr. Tourkakis was most certainly targeted in Arnold because his office did not produce sales tax dollars. We look forward to Rainford’s forthcoming correction.

Rainford also claimed the study made a "factual error" concerning its assessment of the McRee Town neighborhood. While people’s opinions may differ on this issue, two callers to the show backed up Tim’s contention that McRee Town was improving before the use of eminent domain. This can hardly be termed a "factual error."

Tim Lee has written a great study on eminent domain abuse throughout Missouri, and we encourage you all to take a look at it.

The post Eminent Domain Abuse Interview on KMOX appeared first on Show-Me Institute.

In January of 2004, the city of Arnold unveiled a plan to re-develop a large chunk of Arnold commonly referred to as the Arnold Triangle. The plan envisioned 250,000 square feet of retail space, a Dierbergs Market and a Lowe’s store. Unfortunately, there were 52 homes and businesses already occupying the area. They don’t pay as much in taxes as the city expects to get from the big box retailers, and the city has decided to remove them in favor of wealthier businesses.

One of the property owners the city wants to displace is dentist Homer Tourkakis. He and his wife Julie have put down roots in Arnold. They’ve been in the city since 1985, when they started the practice in the Arnold Triangle. They’ve spent the last 21 years forging friendships and attracting clients from all over Jefferson County. They also raised two daughters, both of whom are now in Missouri colleges.

“When I heard about the city’s plans, I had a lot of concern and consternation,” Tourkakis said. “I was ignorant about eminent domain and all the ramifications, and the power that was available to the city. I still looked at the world through rose colored glasses. I thought the city council would be there to defend me. It didn’t take long for me and other business owners to realize that like it or not, this thing was going to happen.”

Business owner Homer Tourkakis in front of his “blighted” dental office.

On September 16th, 2005 the city voted in favor of giving Overland-based developer THF Realty $24 million in tax breaks and the authority to condemn the homes and businesses of property owners who refused to sell.

Tourkakis and his neighbors protested the plan. “I didn’t want to be part of this development program,” said Tourkakis, “I didn’t want to have to dip into my savings and start all over again.”

In response to those protests, some influential property owners were spared. The city promised to give the Veterans of Foreign Wars land within the development area and build a new VFW hall. A UMB bank was also guaranteed a place in the new plans. And Norman Moss, who sits on the city’s Board of Adjustments, managed to get his business, Arnold Stove and Fireplace, spared from forced relocation outside of the development area.

But no such concessions were offered to small business owners like Tourkakis. Tourkakis thinks that the city is playing favorites. “It just seems really arbitrary,” said Tourkakis, “why do some get red-carpet treatment, while I get my life turned upside down so the city can pick up a few bucks?” Tourkakis says that the city council members of his ward, Phil Amato and Joyce Deckman, refused his requests for help.

Board of Adjusts member Norman Moss’s business, Arnold Stove and Fireplace, will not be forced to relocate outside the development area.

Tourkakis’ property, along with about 12 others, was declared blighted by the firm of Peckham, Guyton, Albers and Viets (PGAV), the same consulting company that made the blight determination in the infamous Sunset Hills redevelopment project. In one instance, PGAV cited broken pavement as evidence of blight–never mind that maintaining roads is a city responsibility.

“They say they offer fair market value, but my business has been established in this area for years. I’ll have costs that ‘fair market value’ simply won’t cover. What about my loss of highway traffic? What about the risks I incur?” Tourkakis asked. “The appraisals were a joke. They looked at property that was miles away from mine. Everybody knows they lowball you.”

The developer, THF, did go through the motions of negotiations. THF principal Allen Bornstein visited Tourkakis on three occasions. But Tourkakis charges that the relocation offers made to him were vague and inadequate. “They just wouldn’t talk seriously about a plan,” said Tourkakis. “At one point, Bornstein said to my attorney, ‘Look, I’m not in the dental building business.’ They all seemed pretty convinced that they could push me where they pleased. They were pretty arrogant.”

A “blighted” home a block away from Tourkakis’ dental practice.

The Tourkakis dental practice isn’t as large as Dierbergs or Lowe’s. He employs a staff of three full-time, fully health-insured persons, two of whom are Arnold residents. His practice is one of a handful which treats Medicaid patients, including the elderly and the developmentally disabled. Treating Medicaid patients who can’t pay their bills means operating at a loss. The government only reimburses Tourkakis ten cents for every dollar he spends treating those patients. “I see doing it as part of being a member of the community,” says Tourkakis, “helping out the community makes for a stronger community.” Tourkakis’s practice has treated Medicaid patients for 21 years.

In the coming weeks, the developer must make a final buyout offer to the remaining property owners, who number about 15. If they can’t get the contracts, they’ll ask the city to file a condemnation lasuit against the property owners.

“It kind of makes you wonder why you work so hard to build something,” said Tourkakis. “If they’re just going to take it away from you, why bother?”

Timothy B. Lee is an editor at the Show-Me Institute. Jonathon Burns is a student at Truman State University.

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