Like most special taxing districts in Missouri, the Buc-ee’s CID will use public funds for private infrastructure. The new sales tax rate at Buc-ee’s will only benefit the company itself—the tax dollars collected at the gas station will mostly go toward constructing the building, access road, and parking lot. From its first day of operation, corporate welfare will support the business one Springfield resident referred to as “a beaver Walmart.”

Most residents of Springfield will have no say in this matter. The city drew the boundaries of the CID in such a way that all voters are excluded—only the city council got to vote on this. Show-Me Institute Director of Municipal Policy David Stokes called this “tax gerrymandering” in his testimony on this issue. In addition, four out of the five members of the Buc-ee’s CID board are listed as “Owner Representatives,” leaving only one seat for a citizen to provide a public perspective. Even once the CID is in effect, most of Buc-ee’s customers will likely have no idea about the extra hit to their wallets, since the CID Act doesn’t require any posting of added sales taxes.

Years of writing and research from Institute analysts on CIDs prove that proposals such as these are nothing new. Private developers use the public’s money to subsidize corporate interests with almost no public input. This process with special taxing districts has played out countless times before, both in Greene County and around our great state. You can see for yourself just how widespread CIDs are in Missouri by following the link to this interactive map from the Missouri Department of Revenue. Hopefully Springfield, and cities across the state, will soon learn that this isn’t a mistake worth repeating.

The post More of the Same in Springfield’s New Buc-ee’s CID appeared first on Show-Me Institute.

The Tax Foundation study focuses on funding for America’s highways, and how road usage has been growing while the revenue to maintain them has been shrinking. This is true nationwide and for Missouri.

The bulk of Missouri’s highway funding (and that of many other states) comes from the federal Highway Trust Fund—which is funded by a federal fuel tax that has not changed since 1993. The tax is levied on vehicles that are increasingly fuel efficient. State fuel taxes supplement the federal funding; each state approaches its fuel tax differently. Some index the tax to inflation, some periodically raise it, and still others keep it constant, as Missouri has since 1996, with inflation eating away at its purchasing power.

This funding formula disparity will only get worse as fuel economy improves and no change is made to fuel taxes. In fact, the Highway Trust Fund, which sends money to states for road maintenance, is on the verge of insolvency by the end of next year unless the current funding formula is changed.

The study’s author promotes a charge on highway vehicle miles traveled as a potential solution. This charge would vary based on how much the vehicle weighs to account for the damage it does to the road. As the study notes, this highway formula “gets closer to capturing the externalities and approximating the road maintenance cost of each vehicle.”

In other words, toll roads.

The highway funding situation in Missouri will need to be addressed soon. Travel on Missouri’s interstates has increased 17 percent since 2008, and travel on other Missouri freeways and expressways has increased 20 percent since 2010 (the most recent year for which data for the latter category is available). Conversely, since 2008, the Missouri Department of Transportation’s (MoDOT) overall revenue has decreased by 15 percent, with state fuel tax revenue—the largest state-contributed source of funding—falling 0.5 percent.

Making MoDOT do more with less led to an average of $745 million in unfunded road and bridge priorities between 2014 and 2018. And some of the most traveled roads in Missouri—Interstates 44, 55, and 70—will need to be reconstructed soon.

With these pressing problems, shouldn’t Missouri lawmakers heed the advice of the Tax Foundation report and consider tolling?

The post New Research Highlights Need to Modernize Transportation Funding appeared first on Show-Me Institute.

And while they might not seem like much, Missouri’s highways are something to be proud of, too. Even though we have one of the largest highway systems in the country, the vast majority of those roads, from I-44 to US 36 to Route ZZ, are in great condition. They get us to work, get goods to us, and allow us to enjoy virtually every corner of the state.

While there is no threat to Missouri’s natural beauty, the same cannot be said of the condition of the state highways.  The Missouri Department of Transportation (MoDOT), which funds our state highways, is in serious financial trouble. Whether or not the state can continue to maintain the highway system is an open question. Even worse, there is no money for major improvements like rebuilding I-70 or replacing our many aging bridges.

The prime reason for this is that the largest source of funding for highways, a 17 cent fuel tax, has brought in less and less money over the years. Part of that can be blamed on inflation; part of it is the result of more fuel-efficient vehicles. And no doubt, MoDOT—like any government organization—could have made more prudent spending decisions in decades past.

The most important question now is not how Missouri has gotten into this mess, but how we’re going to out of it. Not long ago, state policymakers backed a statewide sales tax to pay for highways. Bad idea. Why should Missouri’s shoppers pay as much as—or more than—trucks just passing through the state for improved roads? It’s not fair to those who choose to drive less, and it’s not good economic policy to subsidize driving. Missouri voters did the right thing when they overwhelmingly rejected the new tax.

Fortunately, Missouri has a better option: have drivers pay for the highways. Since the inception of the state highway system, it has relied on user fees for funds. There is no reason to abandon that principle now. A small increase in the fuel tax—a few cents per gallon—could prevent MoDOT from running out of money. Many policymakers agree. The governor has come out in favor of a fuel tax increase, and multiple legislators have pre-filed bills that would enact such an increase. For example, one proposal would increase the state’s per-gallon tax on diesel fuel by 3.5 cents and on regular fuel by 1.5 cents.

Higher fuel taxes are not the only solution. MoDOT is looking at tolling I-70, which could provide the funds to construct a modern highway, paid for by those who benefit from it most. Another proposal would allow the state to hand over control of smaller highways to counties and cities in return for additional local transportation funding from MoDOT. Giving local governments the responsibility for maintaining what are for practical purposes local roads, as is done in other states, could allow MoDOT to better focus its resources.

Missouri can’t let its highway system fall into a state of disrepair, but it can fix the system’s user funding base. If Missouri can do that, both residents and visitors alike will be able to enjoy the view with full confidence that the road is good shape and that they are helping to pay for it. 

The post The End of the Road for Scenic Missouri? appeared first on Show-Me Institute.

The post Transportation Funding: I-44, Tolling and the Road to Tomorrow appeared first on Show-Me Institute.

Numerous studies show that the use of TIF does not lead to economic growth for the area and isn’t a financial boon to the jurisdictions that use it. For example, studies of the use of TIF in Iowa and Chicago both found that TIF does not deliver tangible economic benefits. A more recent study in Indiana found “. . . uniform negative impacts of TIFs on traditional measures of economic development such as employment, the number of business establishments, and sales tax revenue.”

So why do Phelps County and Osage Beach (which approved TIF for a senior living center earlier this year) think that their projects will be different in the face of so much evidence to the contrary? It would be a nice to know an answer to that question, but in the meantime, the proliferation of TIF districts continues.

It is easy to understand the appeal of using TIF to redevelop vacant property. If the project gets completed, a new development is in place instead of a deserted lot, and all without “costing” taxpayers. However, development can occur without TIF. It has in Olivette, and it can happen in Rolla, too. 

The post “This Time It’ll Be Different” appeared first on Show-Me Institute.

Imagine ordering the usual for dinner at your favorite restaurant. When the check arrives, you are surprised to find a $2 surcharge for “movie tickets.”

When you demand an explanation, the waiter says the local theaters were losing money. Moviegoers did not want to pay higher ticket prices, so to save the theaters, they decided to make restaurant patrons pay for their tickets.

If the waiter’s explanation seems outrageous, it might interest you to know a new ballot initiative uses the same logic to pay for transportation. The initiative, which the private group “Missourians for Safe Transportation and New Jobs” supports, proposes a 1 percent sales tax on all businesses for 10 years. Its purpose is to raise $8 billion for the cash-strapped Missouri Department of Transportation, or MoDOT, to use on transportation — mainly road — projects. MoDOT needs the cash because during the last decade its road construction costs have rapidly risen while gas tax revenues fell. In 2012, MoDOT’s expenditures outstripped its funding by more than $300 million. If something is not done, MoDOT might not have the funds to maintain, much less improve, more than 33,000 miles of state roads.

MoDOT might need money, but implementing a state sales tax is the wrong policy. The fundamental problem with MoDOT funding, which a sales tax would only exacerbate, is that people who use the roads are paying less than their fair share. With a sales tax, those who use public transportation, ride their bike to work or simply drive less end up subsidizing those who use roads more often. Aside from being fundamentally unfair, the policy incentivizes individuals to drive more and shop less, because road use is artificially cheap and shopping is artificially expensive. That behavior results in increased congestion and pollution.

The real solution to MoDOT’s funding problems is simple: Make drivers pay for the roads. Aside from the fairness issue, charging users for the amount of road used will discourage overuse of highways and create a sustainable funding structure for MoDOT. Faced with higher gas prices and tolls, people will drive less or opt for fuel-efficient vehicles. This reduces congestion, road degradation and pollution.

At 17 cents a gallon, Missouri has one of the lowest gas taxes in the country. This is not automatically a bad thing, but it is an issue when state road maintenance is underfunded. If Missouri simply raised its rate to adjust for the inflation since the tax was set in 1996, MoDOT calculated it would get additional revenues of more than $150 million per year.

Another option is to toll new or improved roads. Other states, such as Texas and Oklahoma, have low gas taxes, but they finance roads with toll revenue. Tolling Interstates 70 and 44, along with new bridges such as the proposed Washington, Mo., bridge over the Missouri River, could greatly defray project costs. Missouri could find financing for roads and bridges in the private sector by auctioning the right to build or operate those tollways.

Implementing a 1 percent sales tax would encourage congestion, incentivize pollution and unfairly burden those who drive less. MoDOT might need more funds, but a sales tax does more harm than good. Missouri should alter its constitution to create a sustainable transportation tax structure that makes economic sense and enshrines the concept of fairness.

Missouri makes the restaurant patron pay for his meal and the moviegoer pay for his theater ticket; it is time to make drivers pay for their roads.

Joseph Miller is a policy researcher at the Show-Me Institute, which promotes market solutions for Missouri public policy.

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I asked a state representative how the Missouri Department of Transportation arrived at the decision to place mile markers every two-tenths of a mile along Interstate 44. His reply was that this was federal money and not state money that was the funding source for this project. In other words, no cost to taxpayers.

The view that federal money doesn’t cost the taxpayer anything is completely false. As I have argued before, there is no such thing as a free lunch. Even if it’s dispensed by the federal government, all public expenditures come out of the pockets of taxpayers — not out of thin air. From an economic perspective, the only way that federal spending differs from state spending is the fact that the costs are further diffused, and the benefits are further concentrated. The money that is spent on mile markers in Missouri may be paid for by taxpayers in other states — but, simultaneously, taxpayers in Missouri are paying for similar projects in other states.

Later in the letter, the writer asks:

How many communities, counties and states in our United States are celebrating this “free” money?

This is a great question. When people perceive that they are spending “other people’s money,” they are less likely to spend it efficiently than they would if they perceived it to be their own. As Milton Friedman observed, individuals are better at spending their own money than somebody else’s money. If people in all 50 states view federal money as “free money,” they’ll spend, spend, spend, and their collective tax burden will skyrocket as a consequence.

The post Mmmm, Free Federal Money appeared first on Show-Me Institute.

Of course, a great financing system could pretty obviously be enacted simply by making the trucks that use the roads pay the tolls to finance the roads. For that matter, the entire highway should be tolled so that we all pay for whichever system we choose to use. I have no problem with gas taxes, and raising the gas tax to pay for highways is far preferable to raising the general sales tax. But using the gas tax as a financing system for truck-only lanes would make the people who drive only on local roads pay just as much for the highway as truckers and long-distance commuters would.

I won’t go into the extreme detail of how we fund transportation in Missouri, but we pay for our roads in many different ways. The people who primarily use local roads pay for them through gas, sales, and property taxes. Tolling the highway would be the fairest and most efficient way to make sure that the people who use the highway — especially people and truckers from out of state — pay for their use of the asset. Passenger cars and, I presume, trucks with enormous gas tanks can quite easily make it across Missouri without filling up and thereby paying gax taxes within Missouri. Currently, many people and trucks driving across the state intentionally stop and fill up while in Missouri because of the low gas taxes here. However, if we pay for a new I-70 and a new I-44 with increased gas taxes (which, again, isn’t the worst idea), we can expect some of the current fill-ups to be redirected across state lines.

Tolling the highway, and eliminating gas taxes for the drivers who pay the tolls, is the best way to fund the changes. Fears of diverting trucks to lesser highways are overblown, especially if trucks are allowed to double-rig in the truck-only lanes, and the toll itself isn’t set too high. The goal is to bring in enough funding to build and maintain the road, not earn a profit.

Thanks to Combest for the link.

The post Happiness Is a Truck-Only Lane in Your Side-View Mirror appeared first on Show-Me Institute.

The Joplin Globe has an odd article (link via John Combest) comparing the median wires along I-44 to the need for fog signs in Joplin. Now, while the usefulness of median wires cannot be argued, how useful are signs warning about fog? Fog does not jump out at your car from behind a bush, and it doesn’t appear out of nowhere. Fog isn’t hard to spot. On the contrary, fog is easy to spot. A sign saying “FOG” is the equivalent of a sign saying, “Slow down because there is a giant wall of water vapor ahead, and you won’t be able to see through it because it is so thick. So thick, in fact, that you can see it from far away, thus making this very sign redundant.” And one would think that while driving through heavy fog, nobody would need a sign telling them to slow down.

Honestly, “FOG” has to be the most redundant road sign since “Slippery When Wet.” If a driver is unwilling to slow down in heavy fog, is a sign telling them there is heavy fog truly going to make a difference? How far away are we from, “Danger: Darkness Occurs After Sunset. Use Headlights”?

So, I guess what I’m trying to say is, if you are approaching a large area of fog, rather than look around for appropriate signage that gives instructions on how to drive, just slow down.

The post Caution: This Sign Has Sharp Edges appeared first on Show-Me Institute.

Hulshof called the public private partnership idea (also known as some type of toll road) intriguing. “Imagine a parallel truck lane along Interstate 44 with just truck traffic that’s built with private funds,” Hulshof asked attendees during his hour session with the Chamber.

Here at the Show-Me Institute, we couldn’t be happier. David Stokes, an expert of sorts on public-private partnerships, has been advocating this type of solution for a long time, and recently gave a presentation in Mexico, Mo., discussing alternative ways to fund and fix the state’s roads. His policy study highlights the benefits of this type of partnership, and outlines the ways in which it can alleviate MoDOT’s budget problems. Although Hulshof stopped short of advocating public-private partnerships, it is good to hear that the idea is at least garnering some discussion.

The post Public-Private Partnerships, Please appeared first on Show-Me Institute.

The post Exciting News For Mobility and Safety On I-70 In Missouri appeared first on Show-Me Institute.

Oklahoma is a big turnpike state. A few years ago,
56 percent of Oklahomans responding to a statewide survey said they
would happily do away with tolls, and more than half were willing to
use state-lottery revenues for that purpose. Of course, state lottery
money wound up being earmarked for public and higher education. But the
fact is that Oklahomans were tired of forever being required to plop
down $3.50 to drive from Tulsa to Joplin or Tulsa to Oklahoma City.

The editorial suggests that Missouri could raise funds for transportation infrastructure instead by increasing the motor fuel tax for a period of time, or increasing vehicle and license fees.

Now, I understand that people may not like the idea of paying $2 or $3 every time they travel up and down I-70 or I-44. For example, I go to school in Illinois, and every time I drive to Chicago I’m annoyed by the tolls on I-88 as much as the next driver. But the money collected helps improve highways, and does it at the expense of the people and businesses that use those roads the most. Raising motor fuel taxes or increasing license fees would affect motorists who don’t use the highway at all — a far less justifiable fundraising base.

Also, I like the idea of having a guy like Little John collecting tolls on I-70.

The post Driving in Missouri Takes its Toll appeared first on Show-Me Institute.