A version of this commentary appeared in The Heartlander

Tradeoffs and give-and-take are at the heart of politics. We’re told that the politicians who are willing to compromise are the ones who “get things done.” But not every tradeoff is worth it. Case in point: In the Missouri legislature, passage of a relatively weak open-enrollment measure has been discussed as a “both/and” that could be tied to passage of another bill that strips the State Board of Education (BOE) of its authority to accredit (or refuse to accredit) Missouri’s public schools. If that’s the offer, it deserves a hard no from legislators.

I don’t often find myself defending the BOE, and for good reason. It is fair to wonder what a school district has to do in this state to lose accreditation. Out of 517 districts, 511 (98.8 percent) are fully accredited, six are provisionally accredited, and none are unaccredited. The Ferguson-Florissant school district is fully accredited despite the fact that only 20 percent of its students are proficient in English language arts, and just 16 percent are proficient in math. Hazelwood, another fully accredited district, shows similarly troubling numbers: 25 percent proficiency in English and 15 percent in math. The Clarkton C-4 district in Missouri’s Bootheel is fully accredited even though 85 percent of students scored below grade level in English/language arts or math last year. Sadly, these are just three examples among many.

The question is: if the BOE isn’t holding schools accountable, what should be done about it? According to the proponents of Senate Bill 360, the solution is to strip the BOE of the power it seems so reluctant to use. The bill would prohibit the BOE from using academic performance to classify schools for accreditation purposes. Districts would instead be allowed to hire outside accreditation agencies to evaluate them. It should be obvious that such agencies would have a strong incentive to tell the districts that hire them what they want to hear.

If the fates of these two bills are linked, what do Missourians get in exchange for essentially throwing in the towel on accountability for school districts? They get House Bill 711, which would allow for open enrollment . . . sort of. It would only let up to 5 percent of students transfer out of any district, and more importantly, it wouldn’t require districts to accept students who wanted to transfer in. Compared to what our neighbors in Kansas and Oklahoma have, this is entry-level open enrollment at best, and it isn’t worth letting the districts themselves decide whether or not they deserve to be accredited.

There is no law of nature stating that the BOE can’t hold districts accountable for student performance. The Missouri Legislature could also make the BOE do its job. In fact, we are about to have four new members of the 8-person BOE, and they are likely to bring fresh energy and commitment to accountability.

The research on high accountability and improved student outcomes is clear, so the rubber-stamping of school accreditation needs to stop. The state, which funds public education to the tune of $6.6 billion each year, has a responsibility to both students and taxpayers to make sure that money is being spent to prepare students for college or the workforce.

If a “compromise” is on offer here it is a troubling example of the misplaced priorities of Missouri’s educational establishment. Who are they protecting here—students trapped in failing schools, or school districts threatened by the prospect of being held responsible for their performance?

The post A Bad Deal for Missouri’s Children appeared first on Show-Me Institute.

All this makes for a great opportunity to bring up the most important annexation-related change we need in Missouri, which is to get rid of the special rules regarding annexations and fire districts in St. Louis County. I am generally not in favor of annexations. We have too many small cities as it is, and municipal annexations should be more difficult (again, outside of St. Louis). I generally support the special rules for new incorporations and annexations within St. Louis County, except for the one involving fire districts.

Statewide, if a city with a fire department annexes an area within a fire district, the city has to pay the lost property taxes to the fire district on a declining basis for five years. That is fair. The district may have issued bonds based on the larger populations, and the five-year phaseout is a reasonable way to address that. But in St. Louis County, RSMO §72.418 allows fire districts to essentially force cities to pay their taxes forever, as long as the original fire district still provides fire protection for the newly annexed part of the city—even if the residents of the newly annexed part want services to be provided by the city’s fire department, not the old fire district.

Hazelwood and Crestwood have found this out the hard way, as both cities – particularly Hazelwood – have been raked over the coals (pun intended) by the Robertson and Affton fire districts respectively. The Robertson case was so egregious it finally spurred a recall of the fire board, which for the previous two decades had been raising taxes to a confiscatory level. How could they do this? Because a tiny number of voters in April elections could elect a board that then raised the tax rates Hazelwood was required to pay under its “agreement” with the district, knowing that the entire city of Hazelwood had to pay the tax, not just the residents within the crossover parts. How much was spending out of control? According to The Robertson Report:

While searching for an explanation for this high cost per call, Valley Park Fire Protection District (VPFPD) was identified as the most proportional fire district to Robertson FPD. Between 2016 and 2020, both maintained two firehouses, two ambulances, one pumper/rescue and one ladder truck, responded to almost equal number of emergency calls (VPFPD 2246 vs RFPD 2455 annually) and took roughly the same percent of commercials calls with an average 8.8% difference. A comparison of financial audits during these years revealed Valley Park FPD had spent $18.8M in total expenses (an average of $3.7M annually) to operate while Robertson FPD had spent $45.6M (average of $9.1M annually) for the exact same EMS and fire service. This is a total spending difference of $26.8M within 5 operating years. [emphasis added]

Special laws like RSMO §72.418 shield fire protection districts from municipal competition for local tax dollars and harm taxpayers. This law needs to be removed. The law is highly beneficial for the fireman’s union, and bad for everyone else, especially taxpayers. If residents and voters want to have municipal annexations or incorporations that include fire protection by municipal fire departments, then that’s what they should get.

The post The Worst Law in Missouri appeared first on Show-Me Institute.

This [policy] does not incentivize (teachers) to try and find a new school or situation that is a better fit for them when they can basically lose their livelihood because months after signing a contract, they realize maybe they need to make a different decision to work in a different setting.

That point sounds vaguely familiar.

Jones is arguing that teachers should be able to break their teaching contract in order to find a school “that is a better fit for them.” Show-Me Institute analysts have been arguing for years that students should be able to find a school “that is a better fit for them” via school choice programs.

I understand the union’s goal is to protect teachers’ rights, but this is an interesting stance to take. In Jones’s view, teachers—grown adults who have made a contractual agreement to teach students for a school year—should be allowed to break their contract and leave their school and students in a lurch. Meanwhile, the MNEA thinks that students who want better educational opportunities should be forced to stay in the schools they are assigned to for up to 12 years.

Teachers should seek to find the best situation for them. Teachers who are not satisfied with their job will not be as effective. However, the Hazelwood teacher had obligations to meet, children to teach, and a contract to fulfill. Breaching your contract and leaving your students and school in the lurch is not an appropriate response to being unhappy with the school.

Teachers are adults who can apply to teach at any school they choose. The vast majority of Missouri children are forced to attend their neighborhood public school with no alternative choices at all. Groups like the MNEA that want as much flexibility as possible for teachers but oppose any flexibility at all for students ought to reflect on the incoherence of that position.

The post Missouri’s Teachers Union Makes School Choice Stance? appeared first on Show-Me Institute.

To summarize, about 20 years ago Hazelwood annexed a part of unincorporated St. Louis County that had been served by Robertson Fire District. Because of an obscure and misguided law (RSMO 72.418), Hazelwood was not allowed to use its own fire department provide fire protection services to the newly annexed area. Instead, Hazelwood was required to keep paying Robertson Fire District the amount it was due from property taxes within the part of its district now within Hazelwood. (It’s more complicated than that, but those are the basics of the arrangement.)

That part is troubling enough, but what happened over the ensuing years is that the fire district was able to convince voters in that area to increase their property taxes dramatically, because the residents did not owe the increased taxes like they normally would. In this case, the entire city of Hazelwood had to pay the higher taxes that benefitted (perhaps) a small number of residents. These elections were likely held on little-attended election dates where small groups of residents were able to wield outsized influence. The fire department union probably comes into play here, as a very politically active union can more easily dominate a fire district than a city fire department, although it can certainly do so with the latter, too.

Over the years, it has gotten to the point where Hazelwood is considering bankruptcy to pay the insane taxes it owes a fire district for services Hazelwood could and should be providing itself to these residents. This situation reflects everything that can go wrong with local government in Missouri—high taxes, inefficient government, and the imposition of taxes on taxpayers who have no say in the matter to benefit special interests. I wrote about this issue in my paper on Special Laws in Missouri. RSMO 72.418 needs to be changed so that cities that annex or incorporate have the option of providing fire services to the new parts of a city if that is what the new residents want. It is reasonable to require some type of payment to the fire district in these instances, but the current law allows the rampant abuse we are seeing in St. Louis County by the Robertson Fire District and needs to be substantially changed.

The post Robertson Fire District Changes Move Forward appeared first on Show-Me Institute.

Overall, the responses we’ve received so far in 2022 look generally like what we saw in 2021. Most schools either have not responded to our request for information or have denied teaching CRT. Some schools have opted to try and charge the Institute hundreds of thousands of dollars to get access to school curriculum, and many more wanted to charge smaller fees. What has been rare, however, is schools openly providing documents that include CRT-type material. Last year, the most prominent example of this was the Kansas City Public School District.

But another notable example from last year was the Hazelwood School District. Hazelwood was one district that provided CRT-related materials when the Institute sent requests last year, and at that time its curriculum included excerpts of the 1619 project being taught to fourth graders and materials provided by the Southern Poverty Law Center about “Teaching for Tolerance.” When Hazelwood responded to this year’s request, the district sent basically the same documents it did last year, though this time without any fourth-grade curriculum, indicating that content was removed from the curricula.

Our director of government accountability, Patrick Ishmael, has been critical of CRT concepts. But it’s important to remember that regardless of the content of the instruction, the public has a right to see it and districts have an obligation to provide it.

Hazelwood should be commended for its honesty and forthrightness in response to our inquiries, both last year and this year. Through two iterations of the project, it is the only district that to date has twice released the pertinent curriculum without any fees, delays, or complaints.

The point here is that if school districts are going to spend taxpayer money to educate students regarding a subject, including CRT, they should make the information available to parents. Ideally, all districts would be transparent with curriculum and would post it on their website or send it to parents before the start of a school year. After all, sunlight is the best disinfectant, and if government transparency can improve curricula, our schools and our kids will be better off for it.

The post At Least Hazelwood’s Honest appeared first on Show-Me Institute.

A few decades back, the City of Hazelwood annexed some adjoining land into the city. That land was previously unincorporated and had been served by the Robertson Fire Department. Because of an arcane and misguided law applicable in St. Louis County (RSMO §72.418), Hazelwood was required to pay Robertson the property tax revenue in the annexed area for Robertson to continue providing service there, even though Hazelwood was entirely willing and able to provide fire services in that area via its own municipal fire department at lower cost. As part of the agreement reached after the annexation, the residents of the area pay a portion of the property tax (as is normal), but the city itself pays anything above the initial tax level. Since that agreement was reached a long time ago, voters in Robertson have approved extremely high property tax rates, which is easy to do because the city—not the property owners—is responsible for the increased property taxes for the portion of the fire district that lies in Hazelwood. Confusing? Yes, it is, and that’s the point. Fragmented government, low-turnout elections, obscure special taxing districts, politically active public-employee unions: taken together, they create the perfect environment for government mismanagement and abuse.

The situation has gotten so bad that Hazelwood is saying it may have to declare bankruptcy. Some residents of Hazelwood have put together a citizen’s group to demand change, and they have successfully placed a recall election for the Robertson board on the November ballot. Average citizens are now engaged in this issue, and that is what the Robertson board should fear the most.

What is the solution here? Well, there are several options. There is the political solution, which will be addressed in the upcoming recall vote. Then there is the direct policy solution, which is to repeal RSMO §72.418 and allow municipal fire departments to serve annexed areas. But there is a bigger issue here, and that is the political influence of the firefighters union and its ability to dominate independent fire districts (and some municipal fire departments, too, no doubt). From this Post-Dispatch story:

Also opposed is Local 2665 of the International Association of Fire Fighters. Only a handful of districts in St. Louis, St. Charles and Jefferson County—including the Northeast district—have fire boards controlled by directors whose campaigns weren’t backed by the union.

The Robertson issue is just one local example of this larger debate. I saw what happened when local politicians in University City tried to oppose the fire union, and it wasn’t pretty. I commend the Hazelwood elected officials for their stance here, but to stop the abuses of firefighters unions in our area many more voters and local officials will need to get involved.

The post Where Is Robertson Fire District, and Why Do They Take So Much of Hazelwood’s Tax Money? appeared first on Show-Me Institute.

Hazelwood’s biggest issue is that it is being held at figurative gunpoint by Robertson Fire District, a taxing district here in St. Louis that could qualify as one of the most obscure taxing districts we have. Robertson Fire District probably should not exist. The City of Hazelwood’s municipal fire department should be providing fire protection services to the entire city, but can’t because of a special law in Missouri that limits the ability of cities in St. Louis County that annex unincorporated areas to provide fire services in those areas.

Cities must pay taxes for the fire district to provide the fire services, which they do less efficiently than municipal fire departments. And it is much easier for fireman’s unions to get control of a fire district than a city government (though they can do that, too.). Anyway, Robertson has significantly raised its property tax rate—a rate that the City of Hazelwood, not just the residents within the fire district, must pay. These expensive bills from the high-spending Robertson Fire District are the primary reason Hazelwood is making the cuts mentioned at the start of this piece, and considering filing bankruptcy. From a Post-Dispatch story on the topic:

Median employee pay in the [Robertson] district was $116,066 in 2021, according to district salary records.

In 2021, the city paid Robertson $4.5. million out of a total budget of $30 million, and that does not include the cost to fund the Hazelwood municipal fire department, which covers other parts of the city.

The Robertson contract requires the city pay any fire district tax exceeding 99 cents for each $100 of assessed value. That cost has ballooned over the years, Hazelwood City Manager Matt Zimmerman told the Post-Dispatch in April. [Author’s note: The current rate is $2.41, much higher than $0.99, although the district claims it is going to lower it.]

This story is an example of a special law that is harming Hazelwood, and other cities, too. Cities within St. Louis County that incorporate or annex new areas should be allowed to provide municipal fire services within those areas. Frankly, Chesterfield should be operating its own city fire department; it could save Chesterfield residents a lot of money.

There is another special law, however, where Hazelwood gets the better end of the deal and uses that special authority to stick it to taxpayers. This law relates to hotel taxes. Hotel taxes within St. Louis County are pooled and used to fund tourism promotion, the downtown dome, and a few other things. The tax rate paid on hotel rooms everywhere in St. Louis City and County is 7.25 percent, on top of the normal sales tax rate. But a few cities (four to be precise, most near Lambert Airport) are allowed to have a hotel tax on top of that rate, and the most egregious one is Hazelwood, with a rate of five percent. The combined sales and hotel tax rate in Hazelwood is over 20 percent, and that is unjustifiable. (The other three cities’ extra hotel tax rates are all under one percent.)

In other words, throughout St. Louis City and County hotel taxes of 7.25 percent fund regional items, but a special law allows Hazelwood to charge an extra five percent to just promote Hazelwood. That needs to be changed and excessive hotel taxes need to be disallowed.

Live by the sword, die by the sword. I fully agree that Hazelwood’s primary financial problem is derived from a harmful special law that needs to be removed (the fire district law), but the legislature also needs to address the hotel tax that benefits Hazelwood unfairly.

I look forward to the Mayor of Hazelwood supporting both changes, not just one of them.

The post Hazelwood, Bankruptcy, and Special Laws appeared first on Show-Me Institute.

The case is complicated. My purpose here is not to get into the legal minutia of the lawsuit filed by the ice rink owners against the city of Hazelwood. But the broad strokes are important. The suit claims that the city has harmed the owners of the ice rink by taking ownership of much of the property in the mall. With the city owning much of the land, it becomes tax exempt, thereby making the ice rink pay even more of the bond debt. The suit also claims that the City of Hazelwood is dragging its feet on approving a youth sports center proposed for the site, and instead favors building an industrial park. The ice rink owners want the youth sports project to help share in the current tax burden, and clearly don’t want to wait for a possible industrial park years down the line.

The whole thing, as Marty Huggins might say, is a mess. SMI analysts have discussed this failure before and for good reason. The entire project from its inception is a perfect example of why local governments need to stay out of the economic development game, not get more involved in it. The mall is partly within a floodplain, in a struggling area, and was launched when indoor malls were already falling out of favor. The original project building the mall may well not have gone forward if Hazelwood and Bridgeton had not supported it with tax subsidies. If it had gone forward anyway, it would have done so with private money. But no, tax dollars—in the form of subsidies—helped propel this financial failure.

Hazelwood seems to be doubling down on its efforts by taking ownership of the land to promote its preferred use of the land. The city’s track record doesn’t justify such a move. A private entity wants to put a sports complex there now. Unfortunately, this sports complex will be getting some tax subsidies. But those subsidies are coming from St. Louis County, and they’ve already been approved.  The best Hazelwood can do at this point is get out of the way and approve the project—more taxpaying entities in the mall will help ease the unfair burden on businesses such as the ice rink. The city doesn’t need to try and do more—it has done enough damage already.[/vc_column_text][/vc_column][/vc_row]

The post “It’s A Mess” Up There in Hazelwood appeared first on Show-Me Institute.

Most schools that have replied so far have told us that they do not have documents that are responsive to our request, meaning they claim they have not incorporated CRT into their curricula and have not talked publicly about it. I trust those representations are true. Readers can follow what we’re receiving from schools and districts, as we receive them, by clicking here. We appreciate the promptness of the responses of districts that have already gotten back to us.

Notably, the Hazelwood School District sent four documents responsive to our request for CRT-related materials: three curricula and one public statement. Some of the CRT materials are incorporated by reference; there are instructions in the curricula to review and discuss content in a linked website but the content is not necessarily fully articulated in the curricula. Some examples of what I found:

Content from the New York Times’ 1619 Project dealing with early European explorers is prescribed for fourth-graders, and ninth-graders are told that the 1776 Commission, established by former President Donald Trump, was an exercise in “identity politics”—a charge it did not also level against the 1619 Project.

The curricula for fourth-graders and eighth-graders also direct teachers, by a link, to materials provided free of charge by the Southern Poverty Law Center (SPLC) and marketed variously as “Teaching Tolerance” and “Learning for Justice.” Readers will find substantial CRT content at this SPLC website.

To be sure, it is difficult to know the full extent to which CRT concepts will be taught in Hazelwood schools; curricula doesn’t always translate directly to the classroom. But it is fair to believe that these materials represent the baseline of the school’s CRT instruction.

Our Sunshine Law request also returned a Hazelwood School Board public statement. Per the statement, the district is engaged in ongoing, unspecified racist practices—a remarkable admission, given taxpayers are being forced to subsidize the district through their taxes. In a long list of action items, Hazelwood’s school board says it will:

[e]mpower the superintendent and charge her with boldly addressing and correcting institutionalized racist practices that have survived because of a “wall of silence and denial,” against our students and in our schools much like that in police departments. The Board will hold itself and all staff, accountable for the same. [Emphasis mine]

I did not know about Hazelwood’s “institutionalized racist practices,” and therefore I did not request documents relating to it. It may be the subject of a follow-up Sunshine Law request.

I encourage the public and parents especially to read for themselves the materials that are being provided, and to do their own due diligence with their own schools as classes return later this year. Transparency is a fundamental part of good governance. Likewise, transparency is the bare minimum that districts and schools should be offering taxpayers when it comes to problematic curricula.

The post First Results of Our Request for Critical Race Theory Curricula appeared first on Show-Me Institute.

The residents of St. Louis County are either served by municipal fire departments, such as the Clayton Fire Department, or by independent fire districts, such as the Monarch Fire District. The fire departments are run by the mayors, city councils, and city managers of their respective towns. The fire districts are run by independently elected fire boards.

In past years, there have been plenty of scandals in fire service management in St. Louis County. Clearly, the scandals must have been in the municipal fire departments, which is why the plan is to eliminate these departments and replace them with the Ceasar’s wives of the fire districts. Right?

Wrong.

The scandals in the fire districts have been well documented over the years by the Post-Dispatch and others. (Unfortunately, I am unable to locate online the main series of investigative stories from the Post-Dispatch that was published about 20 years ago—the lessons in it still stand.) It is the fire districts that have seen consistent financial mismanagement and worse. So why would somebody propose eliminating fire departments and expanding fire districts? Who would possibly propose such a thing?

The fireman’s union, of course. It is likely easier to take electoral control of an independent fire district than a city hall. People pay much more attention to their votes for mayor than their votes for fire district board. Mayors and city council members must consider the costs of fire service as one of many important services their cities provide and put that within a context of overall taxes and spending. Fire district officials just think about spending money on fire services, usually with much less oversight than a city hall gets. In a few places in recent years, such as the Mehlville and Monarch fire districts, newly elected members of the districts have attempted to better control costs. Things have improved at those two major fire districts, but at the price of constant vigilance by the residents. There have been more recent examples of taxpayer abuses in the Northeast Fire District, and the Robertson Fire District is continuing to squeeze the City of Hazelwood to this day.

While nobody says democracy should be easy, you also don’t want to make it harder than it needs to be by constantly growing the number of special taxing districts that voters have to carefully pay attention to. Special interests can benefit from this lack of attention by the average voter, and that is why fire departments should remain under municipal control in St. Louis County.

Merging a dozen municipal fire departments in mid–St. Louis County into one large fire district is a bad idea. You almost have to admire the audacity of it.

There were some good ideas and some bad ideas in the Better Together proposal of a few years back. The work the organization did with the fire departments was probably some of its most poorly done work.

We do need more consolidation, service sharing, and less fragmentation in St. Louis County government. This proposal by the fireman’s union is absolutely the wrong way to go about it.

The post Ready, Fire, Aim appeared first on Show-Me Institute.

So I am excited by some recent, positive steps in the area of local tax subsidies. For too long, state and local governments in Missouri have erroneously believed that tax subsidies spur growth. In fact, the opposite is true. They almost always fail in their purpose of increasing economic growth. Slowly but semi-surely, more people seem to be realizing that.

In Kansas City, there is a serious debate over a bill to further tighten the subsidies offered by the city government (here is my testimony on this bill). When it was first introduced, the bill was stronger. The current version does not go far enough, but, hey: baby steps, man, baby steps. If the bill tightens up subsidy rules at all—and it does—then I think it would benefit Kansas City.

I have already written about Chesterfield rejecting a community improvement district (CID)recently. Hopefully, this is part of this larger trend, both in St. Louis County and statewide.

Earlier this week, the St. Louis County Council delayed a proposal to use tax dollars to support a private youth sports development in Hazelwood. This is a slightly different issue. The tax money at issue here is not an abatement or tax break. St. Louis County would be using hotel tax money raised via measures passed by voters to support tourism-related projects. Nonetheless, the questions raised by those on the council are valid. They want to be certain that if there is a shortfall in hotel tax money (a very reasonable concern in the present environment) that the developer is on the hook for any shortfall, not St. Louis County taxpayers via general revenue tax dollars.

That said, this is fundamentally a private development. While I wish the developers well as they attempt to replace the fiscal, environmental, and totally predictable disaster that was the Hazelwood Mills Mall, they should rely on private funding, not public tax dollars. The fact that elected officials of both parties are questioning the spending is heartening.

Now, time for that tonic and gin . . .

The post Signs of Progress on Local Tax Subsidies in Missouri? appeared first on Show-Me Institute.

Last month, the Hazelwood City Council passed a resolution approving the redevelopment of the failing and deeply indebted St. Louis Outlet Mall. After failing to secure financing for the same project in Chesterfield, the developer, Big Sports Properties (BSP), now plans to convert the mostly vacant mall into a 138-acre youth sports complex called POWERplex, with the help of taxpayer money.

The deal includes nine sources of public financing, which can be divided into four types of incentives:

• The first type of incentive used is special taxing districts, including a community improvement district (CID) and transportation development district (TDD), and they would together levy a 2% sales tax.
• Second, the existing tax-increment financing (TIF) district (from the original mall development in 2003) would also collect half of all economic activity taxes paid at the sports complex, and the agreement includes tentative approval of a new TIF, slated to go into effect next January if the project is on schedule.
• The third type of incentive used involves Hazelwood assisting the developer with debt financing, using economic development loans, Chapter 100 property tax abatement, and property assessed clean energy (PACE) financing.
• Finally, the fourth source of incentives comes directly from the City of Hazelwood and St. Louis County in the form of $3.6 million to revitalize infrastructure.

If this all sounds too complicated, it’s because it is.

There’s plenty of reason to doubt this project will be a good investment. When the mall was first built in 2003, it received public funds totaling $52.5 million from a TIF and TDD. However, the mall sold for $6 million in 2015, just 6% of its original cost. Earlier this year, it was announced that the mall would be closing, and the TDD was mired in debt. In fact, the TDD’s bondholders agreed to settle the debt for $10.5 million, a reportedly substantial discount, which will be paid by the newly formed CID.

The mall was a taxpayer-subsidized failure, and the city is asking for us to trust them again. Even if BSP manages to see the project through this time (part of the reason the development in Chesterfield failed last year was that BSP missed an important deadline) and the first few years are successful, the long-term risk is substantial. Hazelwood might find itself in a similar situation another 16 years from now.

Besides the risk to taxpayers, government should not be picking winners and losers. Hazelwood pulled out nearly every subsidy in the book to help build a private business with no guarantee of success, and taxpayers got to bear the cost. It’s hard to imagine a time when businesses relied on market forces to decide where to build. Instead, it has become a competition between cities to see who can give away the most taxpayer money, and Hazelwood has done an exemplary job showing us where that leads.

The post A Field of Subsidies appeared first on Show-Me Institute.

A system that allows parents to exercise school choice only if they move is inefficient at best. That said, parents with means learn the rules quickly and willingly blend their real estate and education decisions together. So, it’s unlikely that Hazelwood has some secret gems in its education portfolio that parents have yet to discover. Hazelwood built schools based on real estate trends that didn’t materialize. Hazelwood property owners are paying for schools with empty seats.

It’s time to break the connection between real estate and education. Parents should be free to choose a school that is a good fit for their child without moving. Schools should appeal to parents for what they offer—and if it works well for enough parents, the seats will be filled.

Luckily, we can shop at the Chesterfield Mall (or what’s left of it) and enjoy the restaurants and entertainment in the city without moving. And both of those activities pale in comparison to a child’s only shot at getting an education.

The post Billboards, Moving Vans, and School Choice appeared first on Show-Me Institute.

Here are some of the highlights:

The audit noted that the School Board and superintendent spent more than $387,000 in the past two school years on membership fees, travel, gifts, airfare and meeting expenses. The district spends tens of thousands of dollars on items such as sympathy flowers, sympathy cards, “excessive tipping,” bellhops, valet parking, extra airline fees, gifts, T-shirts and board meals.

That’s enough money to give every teacher in the district about a $300 raise. That may not seem like much, but things like this add up. Here is another example from the Post-Dispatch’s report:

The district pays a $600 monthly car allowance to the associate superintendent in addition to mileage reimbursement, even though the associate superintendent only drove $250 worth of mileage for the entire last school year.

According to data from the Missouri Department of Elementary and Secondary Education (DESE), the average administrator in Hazelwood earned $107,526 in 2017. This includes principals and assistant principals, so the salary paid to an associate superintendent is undoubtedly higher than this. I leave it to you to decide whether a $600 monthly car allowance for an associate superintendent is a prudent investment for the district to make.

The audit also found that the school district improperly over-counted student attendance—leading to the district receiving $95,000 that it wasn’t supposed to receive—and failed to report a principal who allegedly stole thousands of dollars from the district. While those two examples are evidence of wrongdoing, what about the spending practices described above? They don’t violate any rules, but they explain a lot about where all that additional education funding is going. In a time of increased focus on teacher pay, it seems incredible that we can say to school administrators, “That’s what you spent your money on?”

[As part of the Show-Me Institute’s Checkbook Project, you can see a full breakdown of the Hazelwood School District’s spending.] 

The post So That’s What You Spent Your Money On appeared first on Show-Me Institute.

I remember my first visit to “the Mills” shortly after it opened in 2003. The 1.2 million square foot building was bustling with people. The line for Panda Express was more like that of an amusement park ride than a mall food counter.

Today, only 77 percent of the mall is occupied (the average occupancy rate for malls is 92%). “Ghost town” is the best way to describe what I saw during my visit last November. The stores I once frequented as a teen were gone—replaced by metal bars and “for rent” signs.

You could look at the decline of the Mills Mall as a sign of the times—malls are out, online shopping is in. In fact, survey data supports this conclusion. In 2014, 34% of Americans said they did more than half of their shopping online—a 99% increase from the 2006 shopping season.

It’s certainly true that digital retailers like Amazon have disrupted the shopping industry, but the decline of the Mills Mall signals more than just the need for mall rats to find a new place to hang out. The failure of the Mills exemplifies why governments shouldn’t use tax increment financing (TIF) as a mechanism for economic development.

TIF is a method of attracting businesses to blighted communities through government subsidies. In 2003, an $18.5 million TIF in conjunction with a $34 million transportation district helped fund the mall’s development. In a 2006 Primer on TIF, UMSL professor Kenneth Thomas pointed out a few problems with this instance of TIF use.

• The building of the Mills Mall displaced sales tax revenue from Northwest Plaza in St. Ann, a shopping complex nearby.
• The project was environmentally harmful—the mall and surrounding road system was constructed on top of a wetland.
• The median income in the community was $52,656—hardly blighted.

Hazelwood’s Economic Developer David Cox told the St. Louis Business Journal, “If the developers could have looked into a crystal ball, they probably would have built it smaller.”

But that underscores another problem with funding large development projects like the Mills—crystal balls don’t exist.

The construction of the Mills Mall had promised 3,000 new jobs. Only half that number was realized.

The Mills Mall points to a serious need for TIF reform in Missouri. Malls may, indeed, be on their way out. Inappropriate uses of TIF should follow suit.

The post St. Louis Mills Auctioned Off for 6 Percent of Its Original Cost appeared first on Show-Me Institute.

Case in point. In the course of my research regarding public pensions, I found that the city of Hazelwood maintains a pension for just its mayor and city council. It isn’t a very large pension. As of 2012, it had $96,000 in assets. But I question why such a pension exists in the first place. Is it really necessary for the council of a small municipality that meets only once or twice a month on average to have its own pension? No other municipality has a separate pension plan for its city council. Despite its size, the city still spends money on the plan. For fiscal year 2014, the city plans to spend $17,000 on the city council pension plan. That is $17,000 too much.

I’ll be the first to say that there is a large difference between $17,000 and $1.3 million. However, before asking for more taxpayer money, I would look at ways to trim the fat. As much as the law allows, I would phase out Hazelwood’s pension for the city council and save the city some money. It is not nearly enough to offset this proposed tax increase, but every little bit helps.

The post Hazelwood Tax Increases And Places To Cut Spending appeared first on Show-Me Institute.

The original timetable called for the Hazelwood plant to be producing vans by 2014, but that has been pushed back because the company is still searching for funding — about $160 million — to build the facility, Marble said.

In addition to some private capital, Emerald has received a $3 million loan from Hazelwood and $2 million from the Missouri Technology Corp., plus a $5 million grant from the British government’s Technology Strategy Board.

The company had hoped to snag a $100 million-plus loan from the U.S. Department of Energy’s Advanced Technology Vehicle Manufacturing Program, but withdrew that application last summer to pursue private investment options after federal energy loans stalled in the wake of the Solyndra controversy. Solyndra, a solar-panel manufacturer, went bankrupt after getting a $535 million DOE loan.

It’s never a good sign when your project, rightfully or wrongfully, gets lumped in with publicly financed boondoggles like Solyndra. The online publication Patch.com reported in July that Emerald says it will open its doors in 2015, with 600 jobs waiting in the wings. But as this process drags on, it begs the question: Is the Emerald project actually happening?  I left a message with the Missouri Technology Corporation (MTC) to find out; I haven’t received a return call.

Fortunately, Hazelwood’s office of economic development was more helpful. Hazelwood indicated that after abandoning the Department of Energy’s loan program, Emerald indeed turned its sights to finding investments from the private market and had been giving demonstrations of their product to potential investors. Although Hazelwood did not have a figure for how close Emerald had gotten to its original $160 million goal, it was pretty clear that Emerald wasn’t exactly getting close — at least not yet. Hazelwood and the MTC could take possession of some of Emerald’s patents if the company goes out of business, but as the Mamtek situation reaffirmed, there’s no telling whether the patents are worth anything close to the public loans that supported the company. That should leave us all a little unsettled.

On the positive side, I was happy to hear that the company is turning its attention to getting investments from the private market. That’s how it should have been from the beginning, and how it should be going forward. Every itemized dollar of investment noted in the St. Louis Beacon article was related in some way to government funding. That’s not how capitalism is supposed to work.

Will Emerald find the green? Time — and hopefully, the market — will tell. We’ll keep you posted.

The post Emerald Automotive Still Seeking The Green appeared first on Show-Me Institute.

The problem is that whites are leaving the district in droves as blacks are moving into it. They are leaving despite schools that are meeting most state performance standards, despite that the blacks moving in are mostly middle- and upper-middle-class, and despite attempts by Clark-Jackson and other administrators to talk them into staying.

And historically in this region, when white flight has occurred, school districts have failed.

Well, there could be many factors at play here. The whites may be moving to districts that do better than Hazelwood on the state tests. It’s true that "white flight" has often preceded (or coincided with) districts’ declines, but if there’s any causal relationship it must have something to do with socioeconomic composition. The article states that the new residents are "mostly middle- and upper-middle-class," so why is this case of "white flight" a problem? Surely no one thinks white people improve school districts with some magical property of their skin color!

The aspect of this article that is most offensive is its labeling of nearly everyone quoted as black or white (in some cases even specifying whether one parent is black), as though people’s opinions about school district quality can only be understood in the context of their race.

The article is so fixated on race that it overlooks other reasons residents might want to leave. For example, it mentions as an aside that Hazelwood still doesn’t meet state standards in graduation rates and college entrance exam scores, two crucially important indicators of district performance. Maybe Hazelwood’s poor academics, rather than racial animosity, drive long-time residents away. The district should focus on improving instruction and graduating more students, instead of counting students by skin color.

The post A Disappointing Article on Hazelwood appeared first on Show-Me Institute.

Parents enrolling their children in better performing districts may use the address of a relative or friend, a business, or even a blank lot. But when school administrators uncover the truth, students are forced back to their home districts, often with legal ramifications for their parents. “Sometimes they’ll beg you to stay. It can be heartbreaking,” says Vershaun Howze, Director of Enrollment for the Hazelwood School District.

The University City School District investigated 113 suspected larceny cases last year, and found 82 violations, while Hazelwood School District reported 92 infractions. And the Ladue School District has uncovered 11 violations this year alone — the same number as the entire 2006-2007 school year.

Parents shouldn’t have to resort to fraud in order to provide their children with decent educations. The rising trend in educational larceny demonstrates the need for significant school reform in Missouri and the steps parents will take to provide their children with decent educations. How much more evidence does the Legislature need?

The post Truancy in Reverse appeared first on Show-Me Institute.