But several Missouri state legislators who received low grades happen to be strong supporters of free-market policies and/or opponents of corporate welfare.

Take Rep. Jay Barnes (R-Jefferson City). The Missouri Chamber gave him an ‘F’.’ I certainly do not agree with everything that he proposed during the 2012 legislative session (nor do I agree with everything that any other lawmaker discussed in this post has sponsored). But Barnes sponsored several bills in the wake of the Mamtek scandal that were designed to limit the Missouri Department of Economic Development (DED) and local governments from irresponsibly awarding large subsidies to corporations.

Rep. Paul Curtman (R-Pacific), who was given a ‘D,’ also sponsored some good legislation aimed at limiting corporate welfare. Curtman sponsored a bill that would require two-thirds of area voters to approve local property tax development subsidies. He also sponsored one of my favorite bills, which would allow people to enter some professions that require a state license without obtaining a license, as long as they do not advertise themselves as being licensed. Do we really need to license interior designers, private investigators, and cosmetologists?

Sen. Jason Crowell (R-Cape Girardeau) was awarded a ‘C’. In my book, Crowell deserves an A+ for taking strong stands against tax credits. Various state departments award hundreds of millions in tax credit dollars every year, frequently with little to show for it. Some state tax credits have been created for just a single company. Crowell has filibustered against these handouts, and during the 2012 legislative session, sponsored a bill that would subject tax credits to the state budgetary process. He also sponsored a bill that would limit tax-delinquent developers from receiving property tax subsidies.

Rep. Jeanette Mott Oxford (D-St. Louis) was awarded the lowest grade. She has introduced bills with which I disagree. But Oxford’s “Good Jobs First” bill would have gone a long way to help bring more transparency and accountability to Missouri’s corporate subsidy programs.

I hope that Missouri legislators continue to fight bills that increase corporate welfare, as well as continue to try and roll back some of our existing corporate welfare programs, regardless of grades received from the Missouri Chamber of Commerce.

The post Legislators Who Opposed Corporate Welfare Receive Low Grades appeared first on Show-Me Institute.

Sen. Jason Crowell (R-Dist. 27) made waves when he spoke out on Wednesday against gimmicks that legislators are using to avoid tough budgetary decisions. The Columbia Missourian reports that Crowell blocked a vote that would extend the amount of time the legislature has to replenish the state’s “rainy day fund.”

Crowell also argued that the proposed state budget counts on uncertain sources of revenue ($70 million that is estimated to be received from delinquent taxpayers), and one-time sources of funding (a $40 million settlement that the state has not yet received).

In a very passionate speech, Crowell stressed the need for tax credit reform, something he has called for repeatedly. Crowell has sponsored several bills to subject tax credits to the appropriations process. Tax credits currently are not subject to appropriations, meaning that tax credit money (which has consistently been more than $500 million in recent years), comes straight out of state coffers, without consideration of whether the state can afford the expense.

During the hearing, Crowell asked Sen. Kurt Schaefer (R-Dist. 19), the budget chairman,  “When are you going to pick Mizzou over Jeff Smith? That’s what this is all about, Senator.”

Crowell was referring to a developer who the St. Louis Post-Dispatch editorial board has called out for benefiting greatly from the state’s Low Income Housing Tax Credit, and alluding to the cuts that have been made to state higher education. These are the kinds of trade-offs that could be considered if tax credits were subject to appropriations; instead, legislators continue to passively give priority to tax credits.

Indeed, St. Louis Public Radio reports that Crowell promised to filibuster uses of one-time funding unless serious overhauls of the tax credit system, prison spending, and state pensions are considered.

Good luck.

The post Props To Sen. Crowell For Speaking Out Against Budget Gimmicks appeared first on Show-Me Institute.

Due to faulty electrical outlets in the home’s bathrooms, Laura said that they are forced to dry their hair in the kitchen, and with the extra money needed to pay for college, they will be forced to continue this practice. Laura also said that the family may have to forego putting new tires on their son’s car. It is not difficult to imagine the unnecessary worry this young man’s parents will feel when their son drives to and from Columbia on old and worn out tires, especially if it is raining or snowing.

While the University of Missouri raises tuition on families such as the one described above due to state cuts in higher education funding, historic tax credit authorizations in Missouri are on an upswing. In fact, the $91 million in Historic Preservation tax credits authorized in the first six months of fiscal year 2012 have almost surpassed state estimates for Historic Preservation authorizations for the entire year.

The question should be asked whether handing out tax credits of questionable value (like the $1 million tax credit issued to Norwood Hills Country Club)  is worth more to the citizens of the state than preventing a tuition increase that will affect families across the state.

Considering that the state of Missouri faces a large budget shortfall, it would behoove the state to make sure that, at the very least, tax credits go to worthwhile projects. A possible avenue for oversight of the tax credit system would be to subject tax credits to the appropriations process. Missouri Sen. Jason Crowell (R-Dist. 27) has submitted a bill (SB 436) that does just that, and there are items in the bill that deserve commendation. Subjecting tax credits to appropriations would enable the state to keep closer tabs on these programs and help ensure that questionable issuances are examined. Considering the price that all Missourians pay for these tax credits, is subjecting tax credits to some sort of appropriations process too much to ask?

The post A ‘Historic’ Surge appeared first on Show-Me Institute.

As the policy analyst leading the Show-Me Institute’s research of the Aerotropolis proposal, I would like to respond to Hartmann’s allegations.

I have never worked on a Republican campaign, in any way, for pay or otherwise. Nor have I worked on a Democratic campaign, in any way, for pay or otherwise. But, in case Hartmann is curious, I have made informational presentations to both Democrats and Republicans who are concerned about the Aerotropolis tax credits.

In fact, this issue is very bipartisan. For example, Rep. Jill Schupp, D-Creve Coer, has voiced concerns about the tax credits, and said that she is working with a group of more than a dozen other democrats on ways to change the bill. On the other side of the aisle, Sen. Jason Crowell, R-Cape Girardeau, has written scathing missives about the tax credits.

As a staff member at the Show-Me Institute, I am thrilled that one of our founders chose to publish an op-ed calling out Republicans who say that they are for fiscal responsibility, but then work to create handouts for a small group of developers and warehouse owners in the St. Louis area. Accountability is needed in state politics, and for members of both political parties.

Hartmann searched the Show-Me Institute website for “tea party” and found three references. I am not sure, but from his writing it seems that Hartmann was looking to find a relationship between the Show-Me Institute and a political party. A search of the St. Louis Magazine website results in many more references to the tea party, but any attempt to tie that finding to a relationship between the magazine and the tea party would be similarly as absurd.

Hartmann also seemed intent on denigrating Rex Sinquefield, co-founder of the Show-Me Institute. For the record, the Show-Me Institute has hundreds of donors. We are more than a single board member or co-founder. Staff members choose what public policies to take on, and what projects to pursue. That all being said, I don’t understand how Hartmann could take offense at an active-minded citizen advocating for more effective government. What exactly is wrong with that?

Finally, I would like to extend an offer to Hartmann: I am happy to meet him at any time to provide an information briefing about the Aerotropolis legislation. The Aerotropolis tax credits — from an economics and corporate welfare perspective — are clearly problematic. Hartmann himself, in an earlier column, wrote that he too has misgivings about the Aerotropolis proposal. The only reason he supports these credits is:

Aerotropolis backers claim that the way the state program is structured, not a dime of Missouri tax credits will be given out on the come. Tax credits will only flow after the Chinese planes start landing, and the revenues (and presumably jobs) actually arrive.

This statement is demonstrably false. Under the legislation, tax credits could be awarded if no increased international trade occurs, and in fact could go toward subsidizing business as usual. Proponents have not fixed this loophole, and have not responded to this point.

Considering the facts, perhaps Hartmann might find himself agreeing with the Show-Me Institute.

The post An Open Response to St. Louis Magazine Co-Owner Ray Hartmann appeared first on Show-Me Institute.

And now we find out from the Kansas City Star that apparently new tax credit provisions are popping up in the legislation, and it looks like no one knows who’s throwing the taxpayers’ money around.

This is a problem (emphasis added):

A reconfigured package of state aid that could benefit a wealthy St. Louis developer is complicating prospects for a special legislative session aimed at creating jobs across Missouri, lawmakers said.

A provision included in one draft of a massive economic development bill could provide additional financial support for developers such as Paul McKee, who has spent years pushing for a sweeping mix of housing, offices and retail space for a two-square-mile area north of downtown St. Louis.

McKee already has received nearly $28 million in land assemblage tax credits, and some lawmakers are frustrated that they haven’t seen much progress in the development….

It’s not clear who put it in the legislation. Lawmakers said provisions can be added to draft legislation without identifying the author.

Two points to consider:

First, how exactly did legislators come to a legislative agreement on July 20 if the legislation hadn’t been finalized? One lawmaker suggested that “various versions of proposed legislation are circulating and that few provisions are set in stone.” Then what precisely was agreed to when the special session announcement was made?

And second, the legislation is well over 350 pages already. How many other tax credit Easter eggs are hidden in these weeds? Legislators and taxpayers shouldn’t have to pass the bill to find out.

The post Unknown Party Slips New-and-Improved Tax Credit Handout into Aerotropolis/Eco-Devo Legislation appeared first on Show-Me Institute.

“If we want to sell more beef to Asia, we need more refrigerated warehouses. If we want to sell more pharmaceuticals and aerospace equipment, we need safe and secure transport facilities,” he said. “I am a strong supporter of this initiative.”

Missouri Speaker of the House Steven Tilley did it (emphasis mine):

Tilley said while the cargo hub would bring in planes filled with imports, the returning flights will open new markets for Missouri agricultural exports, specifically beef.

And former U.S. Senator Kit Bond did it, too. (Audio: Fast-forward to 14:45.)

Yet no matter which way you cut it, beef is — according to the Department of Agriculture — ineligible for export to China. If you loaded American beef onto an airplane tomorrow, it seems pretty clear that it could not go to China under these regulations. So every time a politician touts this beef angle, taxpayers should keep this important fact in mind.

We noted the beef prohibition in our Aerotropolis case study, specifically citing internal emails from Jason Van Eaton, the current China Hub executive director and a former high-level staffer to Sen. Bond. The relevant part (emphasis mine):

Bottom line, pork is officially open between the US and China. Beef is not but the word is that it will open soon … but that’s been the word for months. Many other trade issues keeping this tied up right now.

“Beef is not.”

Kudos to Sen. Jason Crowell, then, for telling his constituents in southeast Missouri how the beef export aspect really plays out (emphasis mine.):

“It will help the job market in St. Louis and our neck of the woods as well,” [Speaker] Tilley said, noting that many people in Perryville, Farmington and Cape Girardeau County drive to work in the St. Louis area. The increased tax revenue from about 20,000 jobs created by the Aerotropolis project would also provide more money for schools and transportation statewide, he said.

“Things that make St. Louis thrive spill over to help the rest of Missouri,” Brandom said.

But Crowell called Aerotropolis a “boondoggle for St. Louis” and said it will not help Southeast Missouri cattle producers because China has a ban on imported beef.

“We’re not stupid down here,” Crowell said. “We can see when politicians who want to take St. Louis money speak down to their constituents.”

As the old Wendy’s ad asks, “Where’s the Beef?”

Much more soon.

The post ‘Where’s the Beef?’ A Reminder That American Beef Products Are Ineligible for Export to China appeared first on Show-Me Institute.

[Nixon’s economic development director David] Kerr said that rather than just putting caps on tax credit programs, the administration wanted to “reform the whole thing from scratch.” Under the plan, the state would set a “global cap” of $314 million in tax credits that could be authorized next year. The number is pegged to 70 percent of the credits claimed last year.

Certain tax credit programs, like the Homestead Preservation Credit for the elderly, would be exempt from cuts and caps, but most of the others would be subject to the cuts. Tax credits are something that Show-Me Institute scholars have written about frequently in past articles and blog entries. Lower tax rates across the board are preferable to targeted tax credits, which can be used to help special interests. The governor’s drastic plan is a good step in the right direction toward decreasing dependency on these credits.

(To be fair, there are a few tax credits I personally think should be kept, namely the charitable contribution tax credit. It is not targeted at any one business, but can be used by individuals to benefit the causes they deem worthy of donation.)

In discussing the governor’s plan, Show-Me Institute staff writer Audrey Spalding made an interesting point: The fact that the governor plans to cut only half of the tax credit programs seems to imply that there is still some value in the 61 tax credit programs currently in place. She suggested that tax credits should be subjected to an appropriations process, an idea proposed in the General Assembly by Sen. Jason Crowell. This would force the real question of whether each program and tax credit is useful in and of itself in comparison to other possible avenues for government spending.

Up until now, the amount that the state spent on tax credits was not bound in any way. But every tax credit awarded is money that cannot be spent elsewhere. At any point in time — but especially during a budget crisis — these tax credits need to be subjected to great scrutiny, so that the cost-benefit analysis is able to weed out the least deserving programs. I applaud the governor’s efforts to reduce tax credits, but I hope that the process goes even further, and officials reexamine the value of each tax credit.

The post Due Credit for Cutting Tax Credits appeared first on Show-Me Institute.

Senator Crowell writes:

Both the director of Missouri’s Department of Agriculture and the Missouri Farm Bureau disagree with the tax Commission’s decision, warning that a tax increase could be extremely damaging to Missouri’s farmers as they work in this struggling economy.

I certainly agree with that. Now is not the time to make food more expensive, and it may never be the right time to do that via tax policy. However, sometimes in the interest of setting proper valuations on which to base property taxes, some people will see their taxes rise while others see them fall. It is important to remind people that some agricultural property would see its assessments — and, thereby, taxes — fall as a result of this study.

I’ll emphasize that I support preventing this new assessment system from going into place, but let’s not pretend for a moment that farm taxes are high in Missouri. That acre of farmland producing valuable commodities that the farmer will sell would only have been valued at $1,270 per acre. That does not entail a tax of $1,270 per acre; as explained nicely here, the tax rates would only be based on that valuation. A tax rate of $7 per hundred dollars of assessed valuation (about average for St. Louis County; it is probably lower in rural Missouri) leads to a property tax of $10.67 per acre — not very much. At that rate, it would take more than 400 acres of the most productive farmland in Missouri to equal the property taxes we pay on our 1/4-acre lot for a starter home in suburban University City. So, keep the taxes as they are; just don’t tell me farmers face a heavy tax burden in Missouri.

If we should be lowering taxes on any one area in Missouri, it should be on commercial/manufacturing property.

The post More on the Proposed Tax Increase for Farmers appeared first on Show-Me Institute.

In my opinion, there couldn’t have been a better time for Missourians to have these tools. At 7 p.m. today, Gov. Jay Nixon will deliver his State of the State address. Given the continuing decline in state tax revenues, Nixon could soon announce another round of budget cuts, on top of the hundreds of millions already cut from the state budget this fiscal year.

Sen. Jason Crowell has argued that tax credits should be part of the state budget process, instead of allowing government agencies to dole out credits with little regard for how much the state can afford to give out each year. And, of course, state agencies and local governments across the board have accepted hundreds of millions in federal “budget stabilization” dollars, which lets them stave off cuts, for now.

Our online tools can help you put these issues into perspective.

Although a $200 million round of budget cuts may seem drastic, state expenditures in 2009 were up more than $1.5 billion from 2008 (see the “Spending Overview” tab). As for state tax credits, I was surprised to see that the amount issued each year varies wildly (see the “Overview” tab) — from a high of more than $500 million in 2006 to less than $150 million in 2009. Most startling is the amount of federal money that state agencies and local school districts are leaning on. The Department of Elementary and Secondary Education has spent nearly $350 million of federal budget stabilization money, and has less than $100 million left (See the “Spending & Revenue by Program” tab).

The data behind these tools will be updated each week, which means you can check back periodically to see what’s new. It’s my hope that these tools are an easy way to keep up with what the state is actually doing, instead of the latest political rhetoric.

The post Now With 95% More Transparency appeared first on Show-Me Institute.

There are some exciting quotes in this story from Sen. Crowell, and he is 100 percent right on all of them:

“You’re never, ever going to get the money until you consolidate,” Crowell said. “I’ll force you. I’ll starve you down to it, if you’re not going to do it of your own free will.”

He went on to say the state has 114 counties but 174 individual 911 call centers, including two across the street from one another in Chillicothe, Mo. In a world where all fast food orders for a chain restaurant go to one place, he said, and all North American service calls for Charter Communications go through Cape Girardeau, there has to be a way to streamline 911 services.

“I know how important it is,” Crowell said. “But by gosh we can do it more efficiently, and that’s what the taxpayers deserve and that’s what the taxpayers demand.”

He then cites some examples of inefficiency in his own area:

Cape Girardeau County has three 911 centers, one operated by Cape Girardeau, one by Jackson and one by the county. Scott County has five independent 911 centers.

As I said, we covered this back in early 2007 as some cities in St. Louis County were consolidating on their own and the state was debating a larger tax to fund them. We still have too many call centers in our area, which goes hand in hand with having 91 municipalities, but there are a couple of examples in which small cities have done a nice job of sharing resources and saving money.

We currently have 174 call centers, and Sen. Crowell said in the article that there should be five statewide. I don’t know what the most efficient and effective number would be, but I am sure it is a greal deal closer to Sen. Crowell’s number than to the current one. I really don’t care whether that final number is five or nine or 12, just that it is a lot lower than 174. It is heartening to see someone fight for efficient use of tax money, like Sen. Crowell is doing here.

The post 911 Emergency Centers Calling Out for Economies of Scale appeared first on Show-Me Institute.