Susan Pendergrass speaks with Show-Me Institute Director of Municipal Policy David Stokes about his new paper in the Free-Market Guide to Missouri Municipalities series on planning and zoning. They discuss how fragmentation among local governments can limit overly strict zoning, how zoning rules affect housing affordability, and why “last house syndrome” poses risks for Missouri’s future growth. From accessory dwelling units and minimum parking requirements to the debate over multifamily housing, Stokes explains how smart reforms can protect property rights and keep housing costs down.

Listen on Spotify

Listen on Apple Podcasts 

Listen on SoundCloud

Timestamps

00:00 Introduction to Planning and Zoning in Missouri
02:35 The Impact of Fragmentation on Zoning
05:24 Housing Affordability and Zoning Regulations
08:22 The Role of Municipalities in Housing Development
11:18 Challenges of NIMBYism and YIMBYism
14:21 Accessory Dwelling Units and Short-Term Rentals
17:00 Planning and Infrastructure in Missouri
19:57 Future Papers and Conclusion

Transcript

Susan Pendergrass (00:00)
Thank you, David Stokes, so much for being on the podcast this morning. You have a new paper out with the Show Me Institute. Well, it’s actually part three of an existing series on your free market guide to Missouri municipalities. And this one is on planning and zoning. So thanks for joining us to answer some questions about it. Great. I do have one question that I was just saying before we started recording. I’ve seen this paper a few times.

David Stokes (00:19)
Delighted to be here.

Susan Pendergrass (00:26)
And one thing that I noticed up front is that I complain about the number of school districts in St. Louis County and how fragmented it is. And other folks have also said similar things, too many small municipalities. But it seems to be the case that when we’re talking about things like planning and zoning and permitting and regulations, that can be a good thing. Is that right?

David Stokes (00:46)
Absolutely. Because it’s harder to enact comprehensive planning, zoning, major things like urban growth boundaries—the extreme things like an urban growth boundary that we don’t have in Missouri. But it’s harder to enact that the more governments you have to get in line to agree to it in the first place. So it’s definitely—I don’t want to say it’s a causation. I don’t think the data is there to—

Susan Pendergrass (00:47)
What?

David Stokes (01:14)
But it’s definitely a—I would say it’s a truism—that there’s a strong connection between the metropolitan areas that have less strict zoning around the country. And over the past decade, we’ve really changed a lot in American local public policy to realize the harms of overly strict zoning. Until the past decade or so, it was just sort of assumed that strict zoning was a good thing. So now that we recognize the harms of it, we see that the places like St. Louis—and to a lesser extent, Kansas City—that have more fragmentation. St. Louis by any measure nationally has extreme fragmentation, meaning a whole lot of local governments, be they cities or school districts or fire districts or streetlight districts. I mean, we can really get into the obscure ones here in Missouri, but the more you have of that, the less strict zoning you’re going to have. And then that results in lower housing prices.

Susan Pendergrass (02:00)
You—

David Stokes (02:10)
What is the good that comes from that in the end? I think there’s lots of goods that come from it and some harms too. But the real good—the point of this paper, and the good for somebody who doesn’t care about public policy or libertarian thoughts or anything and just wants to be able to buy a nice house at an affordable price—is: the less strict zoning you have, the more fragmentation you have, the more you see that in lower housing costs.

Susan Pendergrass (02:35)
Yeah, and if you were starting a business too and one municipality, let’s say Clayton, has really high restrictions on what you can build, where you can build a health office and be—I don’t know if they do or don’t—but then you could just simply go next door to the next place and pick a different place that has fewer restrictions.

David Stokes (02:52)
You can, and that does happen. One of the ways they’ve solved that dilemma in St. Louis County especially is they do a lot more code enforcement and permitting at the county level than at the municipal level. Because nobody wants to have to get—if I’m going to be a plumber—nobody wants to have a plumbing license in 88 different cities. So they do that at the county level. You get your county license and it’s good throughout all of St. Louis County. Now, there are good aspects of that—mostly that you have to get one license instead of 88, which is an obvious good—but it’s also subject to abuse as well. It’s sort of the counterargument to the benefits of fragmentation in that it’s easier for special interest groups, like in this case, say the plumbers union, to capture licensing in St. Louis County if they only have to dominate one board as opposed to 88 boards. So there are two different ways to go—there’s the good and then the part of it that might not be quite as good.

Susan Pendergrass (03:59)
Yeah, so you make the point in this paper that while St. Louis does not necessarily have a housing affordability issue—or maybe even Missouri—it’s still worthwhile for folks who are working at the municipal level, like if you’re working as a newly elected Board of Aldermen or newly elected county board official, to educate yourself on what is and isn’t possible to make sure that you avoid what you just described as the pitfalls of over-regulating.

David Stokes (04:28)
Absolutely. A lot of this paper is about—in the not very scientific term—sort of low-hanging fruit. Just because zoning in Missouri may be less strict than in other states… there’s actually, I discovered in researching this paper—I’d always understood and known that zoning in Missouri and in St. Louis and Kansas City was less strict than in many other parts of the country—but then I discovered that there is actually an index out of the Wharton Business School at the University of Pennsylvania that ranks metropolitan areas by zoning strictness. And St. Louis is the least strict for zoning of any metropolitan area in the country in this ranking. And Kansas City is sort of in the middle. But then you see that Kansas City on the Missouri side is closer to St. Louis, and it’s the Kansas side that is more strict and puts them in the middle. So we really do have not-strict zoning.

Susan Pendergrass (05:05)
That’s hilarious.

David Stokes (05:24)
And that’s a wonderful thing, but it doesn’t mean that cities shouldn’t make some of these reforms that are coming nationwide that would still benefit Missouri, such as abolishing minimum parking requirements, allowing smaller lot sizes, allowing people to build accessory dwelling units on their own property. It’s a great reform focus—from the Show Me Institute’s perspective—because these are changes that can be made that enhance people’s own property rights and what they can do with their own property, while at the same time giving people more choice. And in the long run, if you do more of these, you’ll help keep housing prices down even more for people. And in a good way—you’re not doing this through mandates or rules; you’re just saying we’re going to allow people to build even more. And I’m not against every limit on every property thing ever. There are some that are reasonable—particularly in Missouri we have floodplain limits on where you build that are very reasonable in many cases—but there’s still a lot of good stuff we can do.

Susan Pendergrass (06:33)
Yeah, I saw recently last week that in the upcoming election cycle, housing affordability is a top issue for folks. This is really bubbling up the list of priorities because it’s gotten so expensive and, you know, I keep reading about why people can’t afford to move, and they can’t afford to sell their home, or they can’t afford to buy a home. And certainly some markets—like you mentioned in the paper, like Portland—and you mentioned this briefly: Portland’s got a brown zone and a green zone, and you can’t build in the green zone. You have to stay in the brown zone, and it makes it very prohibitively expensive to build new housing stock in Portland, and the prices have gone up dramatically. We do not yet have that problem in St. Louis, but I know that it’s on a lot of people’s minds and certainly, statewide, we still have some concerns about having enough affordable housing for everybody. I do think it’s important to make sure that we don’t let regulation creep happen so that we find ourselves raising our prices artificially.

David Stokes (07:36)
And you see this in disputes in our exurban areas now in, say, St. Charles and Jefferson County—surrounding counties of St. Louis—and on the Kansas City side as well. Last year, for example, in St. Charles County, a big new subdivision was rejected in a wooded part of the county—I think it was near Weldon Spring. They’re also allowing some, but—

Susan Pendergrass (07:56)
Was it Weldon Spring, or what was that?

David Stokes (08:02)
And that’s the dilemma that people face: as places like St. Charles and Jefferson County grow and get more full, there’s going to be inevitable pressure from the people there now to stop new building. It’s called last-house syndrome: “Great, my new home here is great. Now don’t build any more because I got the house and it’s perfect.” You see that everywhere, and you understand the concerns. I try not to completely ignore the concerns of the folks, because they’re not always wrong—of course, we’ll go back to the floodplain issue—but you’ll have people worry. It’s the people there now: concerns about traffic and overbuilding and destruction of wooded areas and too dense and all those things. But you want people to realize that other people probably said the same thing before they built your house, and it was a good thing that people in most instances really said no to that, and it allowed that construction to continue. And I really want people to realize that.

Susan Pendergrass (08:34)
Yeah. That’s right. ⁓

David Stokes (09:00)
If we go—it’s not about any one subdivision, because look, there probably are certain instances in certain places where the new zoning is too dense, whatever it may be—it’s not that every rejection is always completely wrong. But if you start in Missouri making a pattern of this in the outer areas of Kansas City and St. Louis, where you start turning down a lot of these new subdivisions to preserve whatever it is that people moved out there for 20 years ago, then housing prices are going to increase in Missouri. They will increase substantially, and it won’t take that long if you really do stop the building. So that’s one of the takeaways from this paper: to the largest extent possible, we need to keep allowing the building of these new homes or apartments. And obviously a big part of the paper is that apartments should be generally allowed in more places too. That’s how we’re going to continue to have low housing costs, and that’s the benefit of it. It’s not about one subdivision in one space, but if it becomes a trend, it’s really going to be a problem—the trend being protecting it.

Susan Pendergrass (10:15)
Yeah, and the multifamily for sure. What are your findings around that? People don’t seem to want to have to look at apartment buildings. Is that right?

David Stokes (10:25)
They don’t—there’s just some natural rejection against it. And it’s frustrating to see. In some spots—I remember in the City of St. Louis; this is one where, when you lived in St. Louis, you lived near there—at the corner of Skinker and Delmar there was a proposal for a large apartment building right there, and it got a lot of opposition, and it has not moved forward. It was stopped. I hope it comes back because it’s a perfect lot for an apartment building. It’s just an empty lot—it was a chicken restaurant for many, many years and a popular one—but it’s been vacant forever. And it’s right near public transit. So it’s the perfect idea where you should be able to build there, and you shouldn’t have generous or extensive—

Susan Pendergrass (10:59)
An abandoned empty lot, right?

David Stokes (11:18)
—parking requirements for those buildings, because one of the projects—

Susan Pendergrass (11:21)
That’s what people were kind of freaking out about though, was the parking. Like, where are all these cars going to go? And there was one across the street and they had only put in like one parking space for every two units or something, and they figured that people would use public transport. Anyway, I remember the pushback on that. And it’s this NIMBYism–YIMBYism thing, right? It’s so hard to push people to YIMBYism—yes in my backyard—because of things they don’t… I don’t… These same people often talk a lot about housing affordability, so I don’t mean to overgeneralize, but there are some of the very same people who are so concerned about it who don’t want to look at apartment buildings.

David Stokes (11:50)
Right, don’t want to—and you understand. That’s a very liberal area that we’re talking about. If you were to define the politics of that area, you’re right: many of the residents of those communities in both the city and in University City right there would, in theory, in the big picture, probably agree, but then, “Oh, we don’t want this development here.” And it was a perfect place for a new apartment. Again, of all the St. Louis area, it’s one of the best areas served by public transit—

Susan Pendergrass (12:06)
Yes.

David Stokes (12:31)
—with buses and MetroLink and the WashU shuttles, because so many people who would be in those apartments would be WashU students. They’ve got that extensive shuttle system. But it was rejected, and I hope it comes back. And that’s just one of many, many examples of it.

Susan Pendergrass (12:31)
Yeah, yeah. What about the—what part of zoning and planning is this push in the City of St. Louis, anyway, to try to get people to move downtown? Is that something that’s coded in? I feel like they’re trying to get people to go downtown.

David Stokes (13:03)
They are. And thankfully, I don’t think zoning is preventing that. Of all the reasons people may or may not be choosing to move downtown—fear of crime and businesses leaving downtown, the jobs—as somebody who lived downtown in the late 1990s and early 2000s, to move down there when many of the jobs have left—fear—it’s a harder thing to convince. But I don’t think there’s— I don’t think it’s difficult or has ever been difficult for the loft developers of the ’90s to get permission to take an empty commercial building and turn it into lofts. There might have been a lot of issues they had to deal with, but zoning—I don’t believe—was one of them. Thankfully that’s a very good thing. But it’s one of the fun parts about this paper, right? We’re talking in the other papers and in the ones to come about the best ways to do public safety and public works and a lot of things. In most of these instances we all agree somebody has to do this service, and it’s just a question of: does the city provide it themselves? Do they contract with a neighboring municipality to do it—such as a small city contracting with a neighboring city to do police service? Should you let the private sector do it in a regulated manner, like utilities? But we can all agree it has to be done. Whereas I started this paper saying: despite the fact that it may be incredibly common, cities don’t actually need planning or zoning—life can exist without it. And that’s where the current HOA options come into play. And the history of HOAs in St. Louis, in the private place model, is such an interesting part of that. So there’s a little bit of the historic discussion of all of this in the paper too.

Susan Pendergrass (14:53)
So where do Missouri municipalities for the most part right now stand on things like—two questions I’m going to ask you—accessory dwelling units and short-term rentals or Airbnbs? Where do they stand on ADUs?

David Stokes (15:06)
Well, slowly but surely, we’re starting to permit ADUs. We haven’t had any sort of statewide, to my knowledge, overarching legislation. And that’s where the fact that we have low housing costs in Missouri matters. I don’t think we’re going to see the California situation that had to go statewide because none of the municipalities would agree to it. I don’t think we’ll see that here because there’s not the tremendous high-cost-of-housing crisis to push that. But slowly but surely, cities are starting to allow more ADUs, and that’s a very good thing. When you get out into rural areas—and in some places that don’t even have zoning in the first place—you can do any ADU you want to, or the zoning is so loose that of course you can build an apartment above your garage if you’d like to. Why are you even asking? But the cities have the rules against it.

Susan Pendergrass (15:52)
That’s where I live.

David Stokes (16:03)
Slowly but surely moving in the right direction there. And then it’s going in the opposite way with short-term rentals. Slowly but surely most cities are instituting short-term rental limitations. I’m not automatically opposed to that in every case. I get it: if you have a neighborhood and all of a sudden there’s a house where big parties are being thrown every weekend because they’re renting it out to different groups of people to throw parties, you’re going to hate that, and that’s going to impact the quality of your life. So I’ve been saying for a few years now that the short-term rental regulations I support would generally be things that don’t go to a blanket prohibition. I think that’s too far—and most cities aren’t doing that—but rather really focus on punishment of the property owner for repeated rule-breaking. One party is maybe one party, but if there’s a trend where you own the property and the people you’re renting to are consistently out of control, then the fines should be increased. I wouldn’t be opposed to them getting fairly steep up to a point too—that if it happens too often, you would lose your business license to operate that short-term rental. Because I do think that if you’re doing it a lot—if you’re routinely renting it out—you should be treated a little more like a hotel. We don’t want to give short-term rentals an advantage over the hotel-motel industry. You want that playing field to be as level as possible, especially for people who are renting their houses or condos or whatever out a lot. So then pull that license if it’s an abuse that’s happening consistently. But let’s try to—

Susan Pendergrass (17:55)
Well, I had that on my street.

David Stokes (17:56)
—go to a method through crackdown on rule-breaking, not blanket prohibitions.

Susan Pendergrass (18:00)
Yeah, we had that on my street in St. Louis, and it was a street of, I don’t know, three- or four-bedroom houses, and they somehow had eight bedrooms and a pool, which was very rare in my neighborhood. So they mostly just rented it out to college students and got called all the time—the police got brought in all the time for noise complaints. And there wasn’t really a good mechanism in place at the time to prevent it from happening. So I agree that there should be some limitations around them, but not to make it so strict that people can’t use it as intended. I mean, I stay in Airbnbs all the time. I like having them, but—

David Stokes (18:36)
Now, that police dilemma—that’s something in St. Louis and probably Kansas City, a few big cities, where the cops just have better things to do than break up parties. I mean, they’ve got violent crimes to address. That’s an issue: how are they going to take it seriously enough? In the average Missouri suburb or mid-sized cities, the police are going to take that a little more seriously, I would think. And a good comparison I like is in Lake of the Ozarks, where some cities have instituted strict rules against short-term rentals, while others, like Osage Beach—at least as of our research—hadn’t instituted anything and took a much more free-market approach: “We’re a tourist area; we want tourists to come here.” So it’ll be a good natural experiment over time to see how it affects property values, how growth is affected, as different comparable cities in the Lake of the Ozarks region choose different paths to move forward. So I definitely look forward to following that.

Susan Pendergrass (19:37)
Well, then I’ll know—another component to this paper is on planning. I think you just said a city doesn’t have to do planning if they don’t choose to, but are Missouri cities or municipalities planners? I mean, is that a planned thing, or are we more like anything goes?

David Stokes (19:56)
Most Missouri cities have plans. Right?

Susan Pendergrass (19:57)
I’ve been to New Town, by the way. I just want to say I have visited New Town, so—before you start talking.

David Stokes (20:03)
Well, that’s the architectural planning—how do we want to design it? Then there’s the legal, defined planning. And luckily, again, I really don’t think Missouri cities need to do any planning outside of general infrastructure planning. So I shouldn’t say they don’t need to do any planning—there’s the general infrastructure planning that pretty much everybody supports, meaning you should have an idea of how growth is going to go in your city and where you’re going to put sewers and sidewalks and streets. You want a general long-term plan for that, even if that plan is—as it should be—thoroughly adjustable and can be changed as growth happens naturally. But then you get into planning like we mentioned with Portland earlier—urban growth boundaries—where the planners really start to say, “You can live here; you cannot live here; you can build here; you cannot build here,” and it gets to be really extreme. We don’t really have that in Missouri. Thankfully, the plans that cities do adopt can be easily amended by any city council. They can be changed. When I worked at St. Louis County, we dealt with the county planning commission for the parts of the council district I worked in that were unincorporated, where the planning commission had a lot to say on that. So elected officials can and should be able to change that plan as they go. And then the biggest—let’s say you permitted a development that’s against your plan, but the elected officials want to do it anyway—I usually don’t have a problem with that. The fact that it’s inconsistent with your plan would generally be something that, if locals want to sue to stop the development, they would cite in the lawsuit—that it was inconsistent with your process and your plan—and then it would be determined by judges and the whole legal process. But planning in Missouri is something that, outside of basic infrastructure planning, cities shouldn’t really do. And to the extent that they do it, it’s easily amended and changed. And that’s a good thing.

Susan Pendergrass (21:55)
Mm-hmm. So the first two papers in your series were taxation, right?

David Stokes (22:20)
Taxation was number two, and the first one was just sort of the structure of municipal government in Missouri. It had a lot to do with city managers. And then the fragmentation issue was addressed as well in the first one that we discussed here, because that’s a part of that, obviously.

Susan Pendergrass (22:23)
Introductory. Okay. And taxation. And this is zoning and planning. Right. And then what’s on deck? What’s the next one?

David Stokes (22:41)
We don’t actually know yet what number four will be—germinating. Most of them are ready to go pretty quickly, so I think the next one will be released within the next two months—certainly this year. And I think it’s going to be on public works. But we have papers coming on public works, public safety, parks and recreation—which is one I’m really going to enjoy. You go to Forest Park and there’s all the great things in St. Louis’s Forest Park, and then you realize that many of the wonderful things there are actually done under contract with the private sector, either for-profit businesses like the Boathouse and the ice rink that pay the city to operate, or nonprofit businesses like the Muni that have been in the park for a long time. So it’s a great option to talk about all the different ways to provide parks and recreation services.

Susan Pendergrass (23:18)
Yeah.

David Stokes (23:35)
But those are at least three of the upcoming ones. And then there’ll be a concluding, summarize-it-all-up section as well.

Susan Pendergrass (23:41)
I look forward to hearing more about those, and thanks for coming on to talk about planning and zoning. It’s going to be a great series when it all gets put together. Thanks.

David Stokes (23:48)
Thank you very much, Susan.

Produced by Show-Me Opportunity

The post A Free-Market Guide to Zoning with David Stokes appeared first on Show-Me Institute.

So here is my contribution to the effort. Just tell St. Louis’s Bi-State Development Agency (also known as Metro) “no” on its application for around $700 million in federal funds for the ludicrous Green Line (formerly known as the North-South Line) proposal. Like Nancy Reagan said to Arnold on Diff’rent Strokes, “Just say no.”

The new leadership in the federal Department of Transportation (DOT) has instituted major changes in how the DOT is going to make decisions. This doesn’t look good for the Green Line, as the St. Louis Business Journal wrote about this week. The new DOT guidelines state that, among many other things, the DOT isn’t funding projects for local political purposes or social justice reasons. The new DOT leadership is focused on moving people and goods, and actually moving people is one thing the Green Line isn’t going to do. Metro’s own estimates—which based on history are probably inflated—claim that the Green Line will have only 5,000 boardings (so, about 2,500 people) per day. That is for a billion-dollar project. That’s absurd.

Whether you call it the “Green Line” or the “North-South Route,” I call it an inevitable failure and a huge waste of tax dollars. Even if you support MetroLink, there is no reasonable argument for the Green Line project. The federal government ought to reject this plan and many other similar, though not quite as bad, applications from around the country.

You’re welcome, Elon.

The post Hey Elon, Here Are Some Cost Savings for You in St. Louis . . . appeared first on Show-Me Institute.

The “Green Line” is dependent on approximately $600 million in federal funds; funds I hope it doesn’t get. I suggest that cutting the national debt can start right here. As national politics affects local policy, I am hopeful that upcoming changes to federal policy will be the death of this plan. Indeed, some key voices, including Les Sterman, the past director of the East-West Gateway Council of Government, have recently called for the project to stop.

In 2004, MetroLink planners predicted there would be 80,000 boardings per day on MetroLink trains by 2025 in St. Louis, Missouri (that number excludes Illinois users). In the first quarter of 2024, there were about 18,800 actual boardings per weekday for the entire system, including Illinois (page 23 in link). (Ridership goes up slightly in the summer with baseball games, but not that much this summer, for obvious reasons.) We can just admit that MetroLink usage has been substantially less than projected. St. Louis should focus on serving the existing system as best it can instead of doubling down on failure with this latest expansion fantasy.

The “Green Line” plan only projects 5,000 boardings per day, at best. Even if that turned out to be accurate—and history suggests it won’t be—that is a very low number. Serving about 2,500 people per day (one person equals two boardings, on average) for over $1 billion is a terrible use of tax dollars. This project should not move forward.

The post Absurd Light Rail Project Marches Onward appeared first on Show-Me Institute.

Let’s recap the proposal. The Green Line would be a five-mile route up and down Jefferson Avenue in St. Louis that then turns west for a few blocks on Natural Bridge near Fairground Park (which is where the JVL group bases its concerns). The entire plan will cost an estimated $1.1 billion, but the line is only predicted to have 5,000 boardings a day. That’s 5,000 boardings, not 5,000 people—most riders would use it both ways —and even that estimate is overly optimistic.

The demand for public transit along this route up and down Jefferson doesn’t currently justify its own bus route, but supposedly large numbers of people will magically ride MetroLink when the Green Line appears.

Why is Metro trying to build this route? Well, to quote Metro’s CEO, Taulby Roach:

A billion dollars sounds like a lot of money, but . . . 60 percent of that investment comes from the federal government, so why wouldn’t we want to get that money?

So, basically, let’s get the federal funds and spend them. Who cares that there is no demand for this route or that Metro’s own underwhelming projections admit that few people will actually use it? Let’s get some of other people’s money to spend! No wonder we are $35 trillion in debt.

I commend JVL’s neighborhood group for publicly asking tough questions about this project, which it calls the “Metro-Leg To Nowhere.” The pressure to support this boondoggle is strong. It’s great to see people stand up to it.

The post One Neighborhood Group Stands Up to Metro appeared first on Show-Me Institute.

But now we have good news out of St. Louis County regarding transit. County government has rejected all of the various options for MetroLink expansion into St. Louis County. (This is different from the proposed MetroLink expansion in St. Louis City, which unfortunately has been approved locally. The East-West Gateway Council of Governments is currently seeking federal funding for this project, which I hope it won’t get.)

The problem for the various proposals to expand into St. Louis County is that there is no dedicated way to pay for them, at least not yet. The route starts in the city but the expansion primarily serves the county—so is the city or the county going to pay for the first few miles of the expansion? Would the county pay for light rail inside the city? Would the city pay for part of a light rail expansion that mostly “benefits” residents of the county? (Note the use of quotation marks as there is no overall benefit.) Who knows?

This doesn’t mean that light rail expansion in St. Louis County isn’t going to happen, but anything that puts it in doubt is good news in my book.

The other good news in the story is that St. Louis County is now considering bus rapid transit (BRT) as an alternative to MetroLink:

AECOM [the county’s consulting firm] also has been asked to study the use of rapid bus lines, either using new rights-of-way just for buses or designated lanes on existing roads. Those could be deployed instead of MetroLink expansion or in conjunction with it.

BRT has been used in Kansas City with success, and it is something that Metro should consider for St. Louis. BRT moves people effectively at a fraction of the cost of light rail, streetcars, or trolleys. Unfortunately, it seems spending enormous amounts of money is a good thing from Metro’s point of view, no matter how much of it is wasted.

Increased use of BRT could be the transit option St. Louis has been looking for.

The post The Light Rail Line Less Traveled appeared first on Show-Me Institute.

David Stokes, Elias Tsapelas, and Avery Frank join Zach Lawhorn to discuss:

– The need to update Missouri’s tax and expenditure limits (the Hancock Amendment)
– The passage of SB 727, the education reform bill, by the Senate
and House
– Metrolink expansion, and more

Listen on Apple Podcasts 

Listen on SoundCloud

Show Links:

Find tickets for the April 30 event in Columbia, MO here. 

Read Elias’ new report here. 

Read Avery’s blog on SB 727 here. 

Read David’s blog on the Metrolink project here. 

Produced by Show-Me Opportunity

The post Missouri Needs a Taxpayer Bill of Rights, SB 727 and Metrolink Expansion appeared first on Show-Me Institute.

These two deserve each other. Let’s examine the usage projections that were used to convince taxpayers to approve funding(and various extensions).

Projected passengers for MidAmerica Airport, back in 1997 when the airport was built? Two million.

Plog Research Inc., one of the consultants for the MidAmerica project, estimates 2 million air passengers will be served by the Downstate airport.

Actual passengers in 2022? 163,000. (And trust me, they celebrated that wildly.)

Projected MetroLink ridership after the construction of the cross-county MetroLink extension? 80,000 daily boardings in Missouri alone by 2025.

Actual daily boardings in Missouri in 2023? 16,700.

Public agencies habitually overstate ridership and understate costs to justify these massive projects of all types. High-speed rail, anyone? 

It is worth noting that the current five-mile MetroLink extension to the airport in Illinois cost $98 million, while the proposed MetroLink extension in St. Louis, which is also five miles long, is estimated to cost $1.1 billion. A billion-dollar difference for the same length of route. To paraphrase Everett Dirksen—himself a son of Illinois—a billion here, a billion there, pretty soon you’re talking real money.

It is great that we can finally connect two massive transportation boondoggles that don’t take anyone for a ride but taxpayers.

The post MidAmerica Airport and MetroLink Deserve Each Other appeared first on Show-Me Institute.

– The stadium tax debate in Kansas City
– The MetroLink expansion plan advances in St. Louis
– How to make it easier to access virtual health care in Missouri, and more

Listen on Apple Podcasts 

Listen on SoundCloud

Produced by Show-Me Opportunity

The post KC Stadium Debate, MetroLink Expansion, and MO Loses the Top Spot appeared first on Show-Me Institute.

As Metro prepares to expand MetroLink again, we must ask one simple question. Why? Why are we expanding an expensive system that very few people use when Metro continues to cut its bus system over and over again? The bus system actually serves the people who need and use public transit, unlike MetroLink, which is primarily for those who use transit occasionally for sporting events downtown.

Did you know that the St. Louis area had more transit riders before we built MetroLink than we do now? We spent billions of dollars to build a light-rail system, and fewer people ride transit than before it even existed. What if we had spent a fraction of those billions on building a better bus system? A bus system that gets people who rely on public transit to school, work, the grocery store, and, yes, the ballpark, too.

It’s not too late to stop the latest MetroLink expansion mistake. I hope that O’Toole’s report can be a part of the discussion that convinces St. Louis’s political leadership to redirect our money for transit toward helping residents who depend on transit to go where they need to go every day instead of focusing on getting suburbanites to the soccer game a few times a year.

The post The Folly of MetroLink Expansion appeared first on Show-Me Institute.

Is this plan going to be a positive step forward for the St. Louis area? No, not at all. It will be a wasteful doubling down on a failed strategy to force feed light rail into a metropolitan area that would be far better served by an improved bus system from a transportation, financial, and social perspective.

In a forthcoming paper for the Show-Me Institute, Randal O’Toole will discuss how addressing transit issues in St. Louis by expanding MetroLink is a fool’s errand, and an extremely expensive one at that. Metro’s total transit ridership in 2019 was less than it was in 1993, before MetroLink even opened. The pandemic only exacerbated this problem, with fewer jobs and workers in downtown than before. Jobs are spread out throughout the metropolitan area, and buses are well equipped to connect workers to changing jobs, students to new schools, and sports fans to games. (We can admit MetroLink does a good job with the sports teams for some—but that is hardly a justification for expanding the entire wasteful system.)

Metro would better serve our region by spending its tax money on an effective bus system, including bus rapid transit for high-volume areas, instead of expanding a costly, inefficient, and unwieldy fixed-route light-rail system that fails in its primary purpose—serving St. Louis transit users.

The post Costly AND Outdated. Where Do We Sign Up? appeared first on Show-Me Institute.

The proposed route received some tweaks earlier this month, and now is set to run from Natural Bridge Road at Grand Boulevard in north city down Jefferson Avenue past the National Geospatial-Intelligence Agency (NGA) headquarters and the site of the new MLS stadium. This new plan has an estimated price tag of between $600 and $800 million and would be financed primarily through federal funds. However, like the ill-advised KC Streetcar expansion, expanding MetroLink would be a waste.

The first and most obvious problem with the proposal is ridership. The project is touting the ability to connect impoverished areas of North Saint Louis with centers of commerce in places such as downtown and the Central West End. However, project leaders have yet to put out research supporting this claim. Considering that fewer and fewer people are commuting downtown for work, there are reasons to be skeptical of this assertion.

As a longtime Saint Louis sports fan, I understand that MetroLink can be a convenient way to get downtown and avoid the stress and costs of parking. However, building an additional stop and line to service the new MLS stadium is completely unnecessary, considering its proximity to Union Station­­­–it is only 0.2 miles away, or a five-minute walk. Instead of changing lines to access the dedicated stadium stop, soccer fans taking the train downtown would be better off exiting at Union Station and making the short walk over.

As with the KC Streetcar expansion I wrote about in a recent blog post, spending hundreds of millions of dollars on a questionable MetroLink expansion comes at the expense of bus systems.  Saint Louis Metro has been forced to cut lines amid staffing shortages, an issue which is predicted to persist into next year. Metro Bus is the primary means of transportation for roughly 22,000 St. Louis commuters, compared to only 4,000 commuters who primarily use MetroLink.

If St. Louis wishes to use federal money to improve public transit, it should improve the bus system and invest in more efficient types of public transportation, like Bus Rapid Transit (BRT). Unfortunately, policymakers’ tendency to chase shiny objects will likely leave Saint Louis with a defunct trolley, an oversized light rail system, and thousands of unhappy bus riders.

The post Even with an Updated Route, MetroLink Expansion is a Waste appeared first on Show-Me Institute.

Between 2014 and 2019, ridership on St. Louis Metro buses and light-rail trains dropped by nearly 25 percent. Thanks to the pandemic, ridership in recent months has only been half what it was in 2019, and thanks to increased numbers of people working at home it may not ever return to 2019 levels.

This suggests that St. Louis doesn’t need to spend hundreds of millions—or billions—of dollars building new light-rail lines. Yet that is exactly what St. Louis Mayor Tishaura Jones wants to do, not because St. Louis needs it, but because federal funding might become available for it. That federal funding would depend on local matching funds, meaning St. Louis taxpayers would have to pay higher taxes for train rides few of them will take.

St. Louis’s light-rail record is unimpressive. In 2001, Metro opened the 17-mile MetroLink College extension, doubling the total number of miles in the system. Metro carried fewer bus and light-rail riders the year after opening this line than it had carried the year before. The same thing happened when it opened the 3.5-mile Shiloh-Scott extension in 2003. The 8-mile Shrewsbury-Lansdowne MetroLink extension gained some new riders, but all of those riders were lost after the 2008 financial crisis, and most never came back.

Overall, light rail has failed to boost the region’s transit ridership. In 1993, before the region’s first light-rail line opened, buses carried 40.3 million riders. Since then, Metro has spent around $2.5 billion building 45 miles of light-rail lines. In 2019, buses and light rail together carried 36.1 million riders, 11 percent fewer than before light rail.

Part of the problem is that light rail is functionally obsolete: just about anything light rail can do, buses can do better for far less money. Counting capital costs, Metro spent $12.80 per light-rail rider but only $8.30 per bus rider in 2019.

The current proposal to expand MetroLink with a new north–south corridor line through downtown fails on two key fronts. First, while transit advocates say spending more money on transit helps low-income people, the fact is that most low-income people do not take transit to work. Census Bureau survey data show that only 4.4 percent of St. Louis–area workers who earned less than $25,000 a year took transit to work in 2019. Meanwhile, the sales taxes used to support Metro buses and light rail are highly regressive, meaning the 95.6 percent of low-income people who aren’t dependent on transit are disproportionately paying taxes to support rides they aren’t taking.

Second, cities that have successful rail transit have a high concentration of jobs in a central business district, and St. Louis is not one of those cities. The percentage of regional jobs in downtown St. Louis has been declining for years. It is currently down to about 60,000 employees downtown, very few of whom take light rail to work. Expanding MetroLink on the proposed north–south route will be a very expensive attempt to take people who don’t use light rail for work to jobs in an area where they don’t work.

The places in downtown St. Louis that benefit from MetroLink (the stadiums, convention center, etc.) already have it. The money Metro wisely spent adding and improving stations at Cortex and Barnes Hospital cost a fraction of the amount of a new line and served an area where people of all incomes actually use MetroLink to go to work. (The Barnes/Central West End stop is the busiest stop in the system.)

Meanwhile, while we debate MetroLink’s further expansion, Metro’s bus system is “disintegrating,” says engineer Richard Bose at the pro-transit NextSTL website, because the agency can’t find enough drivers to keep it operating. Jones and other city and regional officials should devote their efforts toward helping Metro run the system it already has rather than trying to expand it. Federal and local funds spent on an effective bus system offer a better solution to address the needs of the people who live in North St. Louis County. Otherwise, people might get the idea that the real purpose of light-rail transit is not to move people, but to move dollars from taxpayers’ pockets into the hands of light-rail contractors.

The post MetroLink Light Rail is MetroWaste appeared first on Show-Me Institute.

• Operating revenue is not close to covering expenses—MetroLink’s parent organization, Metro Transit (which also includes MetroBus and Call-A-Ride), covers only about 18 percent of its expenses with fares from riders. The rest of the revenue comes from local, state, and federal subsidies.
• Ridership is down by over 20 percent since 2014, so the revenue picture isn’t getting better.
• The primary reason people don’t want to ride MetroLink is that they don’t feel safe. A comprehensive study of MetroLink’s performance released earlier this year found that 71 percent of people surveyed cited security concerns as their biggest criticism of MetroLink (page 4).

So, given that MetroLink is (1) solidly dependent on subsidies for the foreseeable future, because (2) ridership is declining, because (3) riders fear for their safety, what would you prioritize?

Would you decide to build nine more miles of MetroLink for almost $700 million?

Back in the real world, this is what Metro intends to do, apparently missing the point that if people don’t feel safe riding MetroLink, they’re not going to feel safer just because it covers more ground.

Violent crimes on the MetroLink—defined as homicide, shootings, aggravated assault, and rape—numbered 197 during 2017. Proportionally, there were 1.4 violent crimes per 100,000 boardings in 2017. From January to October in 2018, violent MetroLink crimes in St. Louis declined 12 percent according to the head of the city’s MetroLink police unit, although it is unknown if this trend also held system-wide.

Metro justifiably believes that the safety perception spurred the 11 percent drop in ridership between 2017 and 2018, and recently approved a plan that would allow them to hire off-duty sheriff’s deputies for extra security. But should we assume that the recent dip in violent-crime numbers will repair MetroLink’s image and bring riders back? Or would it be smarter to wait and see if the positive trend continues before sinking $700 million into a massive expansion?

Even if people eventually feel safe riding MetroLink, the wisdom of adding another line is open to many questions. This much should be clear, though: MetroLink should not be laying more track when people don’t even want to ride what they already have.

The post If You Build It, Will They Come? appeared first on Show-Me Institute.

The sales tax rate in St. Louis is now one of the highest in the nation, only behind places like Chicago and Seattle. Currently, the base sales tax rate in the City of St. Louis sits at 9.679%. So, when you shop, you’re paying nearly 10% extra in taxes, and when you shop in one of the many areas with overlapping special taxing districts, you’re paying close to 12%. The rate is high relative to other cities, and it is high absolutely—it is pretty darn expensive to spend your own money in the Arch City.

The chart below depicts the base sales tax rate in St. Louis over the past 20 years. Slowly and steadily (and sometimes in quick bursts), it has been on the rise.

Source: Missouri Department of Revenue, Sales/Use Tax Rate Tables

Recent increases are due to special sales taxes for additional public safety funding and expanded economic development initiatives (like the north–south MetroLink expansion, which is unlikely to spur any development).

As I’ve written before, with each increase in the sales tax rate, policymakers will have fewer and fewer chances to go to taxpayers for projects that truly need funding. St. Louis may soon reach a point where the public is simply unwilling to cough up more of its money, however pressing the public need. Some residents and businesses may just call it quits and move elsewhere.

Moreover, we should all ask ourselves whether we’re getting the government we’re paying for. When the city has basic infrastructure woes (you should see the road I drive on every day for work), has trouble keeping refuse trucks running, and seems most occupied with giving away subsidies, it is hard to believe St. Louis government is worth nearly 10 cents on the dollar (in addition to the numerous other taxes it levies). 

Policymakers, like the rest of us, could always use extra cash. But there is a point at which we must make do with what we have. St. Louis officials should begin tightening their belts instead of asking for more, just like the average taxpayer must.

The post St. Louis’s Ridiculously High Sales Taxes appeared first on Show-Me Institute.

But who knows what city taxpayers will end up getting for their “investment?”

Taxpayers likely won’t get the 17-mile route they were presented last year. After more than a year of study, it was recently announced that the first phase of expansion will run some 9 miles, roughly from Chippewa St. to the NGA site north of downtown, and will cost $700 million. The project is also totally dependent on federal funding, which is a big if at this point, and will begin operations, best case scenario, in a decade.

It’s also unclear whether the expansion will get St. Louisans out of their cars. While consultants project the line will carry some 9,200 riders a day, my colleague Joe Miller has pointed out that it runs through neighborhoods with relatively low population density—density about a quarter of what’s needed for light-rail to be successful. Also, overall MetroLink ridership is trending downward; not only has it lost 3.9 million annual rides since 2014, but the rail system carries fewer passengers than it did prior to the 2006 Shrewsbury expansion. And crime on and around MetroLink trains has, according to Metro, contributed to an 11% decline in ridership since last year. While I don’t doubt that an expanded system will (at least initially) carry more passengers, experience—and more than 15 years’ worth of data—suggest we shouldn’t get our hopes up.

Source: National Transit Database, Federal Transit Administration

But perhaps the biggest if is the economic renaissance promised by MetroLink officials and proponents. Transit advocates claim that rail spurs economic development, that, once you put the rails in, the traffic generated by riders will induce all sorts of business growth. Unfortunately, this claim just doesn’t hold up. Many MetroLink stations are surrounded by land that’s either (a) already developed (and likely heavily subsidized), or (b) relatively empty. In fact, transit-oriented and adjacent development is so scarce in St. Louis that rail advocates have to cast an incredibly wide net for any evidence of it. For instance, Citizens for Modern Transit, the region’s major transit advocacy group, includes investments on Interstates 64 and 70 and parking garages as development “spurred” by MetroLink. And Metro, which operates MetroLink, seems to think any investment within a half-mile of a rail station is causally linked to the presence of their trains. (Or, all they present is data on development within a half-mile of their stations.) Perhaps this is why consultants are now saying that MetroLink could “spur possibly millions of dollars in economic development….” (my emphasis).

At this point, it’s unclear what, if anything, taxpayers will get in return for hiking up their sales taxes. Although rail proponents may have inexhaustible faith, history and facts suggest taxpayers won’t get much for their investment.

The post What Will the City’s New MetroLink Tax Get Us? appeared first on Show-Me Institute.

Back in April, voters in the City of Saint Louis approved a half-cent “economic development” sales tax hike. The increase, which brings the city’s base sales tax rate to 9.179%, is slated to fund a north–south MetroLink expansion, public safety, workforce development, and other programs. It also makes Saint Louis home to one of the highest sales taxes in the nation. In fact, Saint Louis now has a higher sales tax than New York City and San Francisco.

But policymakers aren’t finished yet.

There are two new sales tax proposals coming down the pipeline. One would raise sales taxes by one-eighth of one percent (0.125%) to help fund infrastructure improvements and conservation efforts at the Saint Louis Zoo, which is already funded with tax dollars. The other would raise the rate by one-half of one percent (0.5%) to bolster public safety spending. If both hikes were approved, the base sales tax rate in the city would be 9.804%, the 6th-highest in the nation. In areas with overlapping special taxing districts (of which there are dozens in the city), the rate would be nearly 12%.

There is neither a formula to determine the proper sales tax rate, nor a proven sales tax “ceiling,” but policymakers should carefully consider the implications of these proposals and whether there are alternatives to raising taxes.

For instance, if these sales taxes are approved, will voters have an appetite for other, more pressing proposals? That is, will these proposals exhaust Saint Louis’s sales-tax capacity? Also, will the proposed hikes disproportionately affect the poor? Is it fair for the city’s poor to subsidize the zoo for visitors from surrounding counties? Moreover, are sales taxes an appropriate source of funding for public safety? Police and firefighters are essentially security guards for taxpayers’ persons and property, so shouldn’t they be paid from property taxes?

Sales taxes can generate significant revenue and are easy to collect, but that doesn’t mean rates should be hiked every time a public need comes around. Perhaps if officials weren’t so eager to hand out taxpayer dollars for corporate welfare, Saint Louis wouldn’t need such high taxes for basic services. So, before asking taxpayers for more, perhaps city officials can reflect and ask themselves, “Can we do more with what we’ve already got?”

The post Saint Louis, the Sales Tax Monster appeared first on Show-Me Institute.

The version of the bill in front of the Governor has changed since it was first introduced. Previous drafts would have allowed for similar sales tax hikes in Saint Charles, Franklin, and Jefferson counties. The narrower focus of the bill means distant shoppers won’t have to subsidize the zoo (which is fair), but it also means a smaller portion of the public will shoulder the burden of supporting a “free” zoo. It also means city and county taxpayers could be taxed twice for the zoo. 

Currently, the zoo is supported by visitor spending, donations, and a property tax levied in Saint Louis City and County. So if a sales tax is passed, city and county voters will pay two taxes for the zoo. And while taxpayers would get an improved zoo for that extra money, the new funding wouldn’t fix the underlying problem with the zoo’s funding structure: free riders.

Since no admission is charged at the zoo, city and county taxpayers support the zoo for everyone, from Saint Charles residents to visitors from Hawaii. Predictably, the issue of fairness arises: why should just city and county residents pay for the zoo? While some propose a regional taxing structure to remedy the free-riding problem, in reality it would convert only a portion of the free riders into supporters. A fairer solution would be to charge admission for those not paying zoo property taxes. (For perspective, a $2 admission fee for residents outside the city and county, assuming a 10% reduction in visitors, could raise more than $3.5 million a year.)

A zoo sales tax would worsen the ever-growing sales tax burden for city residents. With the passage of the MetroLink sales tax hike in April, the city’s sales tax rate jumped to 9.179%, the 13th highest of major US cities (and higher than in New York City, Los Angeles, and San Francisco). If a zoo tax were to be approved, the city’s base rate would top 9.3%, and in some areas littered with special taxing districts, be as high as 11.3%. For many city families, these tax increases mean hundreds of dollars a year they cannot spend on food, school supplies, and other goods and services.

We all love the zoo, and there’s no denying it could use some cash for infrastructure and other projects. But taxpayers should think hard about whether sales taxes are a fair way to fund this famous Saint Louis institution.

The post Double Taxation: Saint Louis Zoo Edition appeared first on Show-Me Institute.

The Gateway City is now home to the 13th-highest base sales tax rate of all major U.S. cities. Yes, Saint Louis has a higher sales tax rate than New York City (9%), Los Angeles (9%), and San Francisco (8.75%).

With city voters’ approval of Proposition 1—a half-percent sales tax for MetroLink expansion and other “economic development” projects—the base sales tax rate in Saint Louis will rise to 9.179 percent from 8.679 percent. While that might not sound like much, those nickels and dimes add up for families struggling to make ends meet. For instance, if the median city household spends 10 percent of its income on goods in the city, the recent hike amounts to more than $175 in extra taxes annually. Perhaps wealthy denizens of the Central West End can afford that burden, but many in less affluent parts of the city cannot.

Unfortunately, the city’s base sales tax doesn’t even tell the whole story. Saint Louis is littered with dozens of shadowy special taxing districts, such as transportation development districts (TDDs) and community improvement districts (CIDs), that charge sales taxes of their own. TDDs and CIDs can each charge up to a one-percent sales tax. When you stack a TDD and CID on top of one Saint Louis’s base sales tax, you could be paying more than 11 percent in sales tax! Add on the city’s 1.5-percent restaurant tax, and diners in the city will soon be paying more than 12 percent in taxes on their purchases.

Some cities have high sales tax rates to compensate for low property or income taxes. For instance, in certain southern cities, policymakers have decided to fund public services through consumption taxes (e.g., sales taxes) rather than property or income taxes. But Saint Louis doesn’t have low property taxes to compensate for, and it has both an earnings tax and a payroll tax! Sure, the city only collects property taxes on 60% of real property by value, but that’s in part because the city owns tens of thousands of properties and has engaged in decades of generous tax giveaways. None of Saint Louis taxes is low.

Is the additional tax resulting from the passage of Prop 1 at least worth it? Almost certainly not. The North–South MetroLink line it’s slated to fund won’t be built, even in the best-case scenario, for at least a decade. Assuming the route is eventually built though, promises that it will lead to economic revitalization don’t align with past experience. After two decades to work its magic, light rail has utterly failed to keep people and jobs downtown or spur the ever-elusive “transit-oriented development.” In reality, the approval of Prop 1 simply means that those who can least afford the burden of extra taxes will pay for a luxury amenity designed to lure wealthy suburbanites out of their cars.

While there is no sales tax “ceiling,” voters will only put up with so much, and residents and businesses can only afford so much. Before policymakers propose another pie-in-the-sky project, they should consider if the taxpayer piggybank they’ve grown accustomed to raiding will always be there.

The post How Much Can Saint Louis Taxpayers Take? appeared first on Show-Me Institute.

Dr. Patrick Rishe of Washington University in Saint Louis argues the current MLS stadium deal is one of the best he’s ever seen, as it includes numerous safeguards for the city and taxpayers and doesn’t use sales taxes to fund construction. Moreover, only 39% of stadium costs will be paid for by the public, compared to the usual 65% to 70%. Therefore, it’s a good public investment—and it certainly isn’t “corporate welfare.”

While his premises are true, the conclusions Dr. Rishe draws are not.

• Rishe states that this deal protects taxpayers in ways previous stadium deals did not. For instance, the ownership group must pay for cost overruns from construction, and the team has to stay in Saint Louis for 30 years (if the MLS doesn’t fold before then). These are reasonable provisions, but they don’t have anything to do with whether a stadium will grow the economy or redevelop downtown. The contractual safeguards simply manage the city’s risk; they don’t guarantee any of the glitz and glam proponents are promising. The stipulation that taxpayers won’t cover cost overruns doesn’t mean the benefits used on to justify the public expense, like economic growth, will be realized.
• Rishe points out that use taxes, which are paid by businesses, will go toward funding the stadium—not sales taxes paid by all city residents. Supposedly, it follows that residents won’t pay for the stadium unless they own a business or buy tickets. But while sales taxes won’t go directly to the stadium, city residents must increase their sales tax rate to get the stadium. That’s because use tax revenue can only be diverted to the stadium if voters first approve a sales tax hike for the MetroLink expansion. So while your sales taxes won’t pay for the stadium, you have to pay extra sales taxes for the stadium.
• If 39% is a breathtakingly low public contribution for a private venture, I’m in the wrong business. Cities across the country have been scammed by sports teams for decades, and the fact that other cities have agreed to worse deals than this one is hardly reason to celebrate. If $60 million is such a negligible contribution, why doesn’t the ownership team simply pay it themselves? Only cash-addicted millionaires would look at an offer to pay 61% of the cost for their own pleasure-dome as a selling point. (As for the $150 million expansion fee the ownership group is coughing up, recall that when the MLS announced the fee would be $50 million less than originally announced, stadium boosters didn’t reduce their ask for public assistance.)
• Rishe contends that giving away $60 million in handouts isn’t corporate welfare because MLS teams don’t turn a good profit. First, the profitability of an enterprise doesn’t bear on whether or not its receipt of subsidies counts as welfare. And second, if the teams currently in the league aren’t turning a profit, what does that say about the long-term prospects of a franchise in Saint Louis? We already have one stadium without a team downtown—do we want to risk adding another?

Joe Reagan, head of the Saint Louis Chamber of Commerce, notes (along with others) that the ownership group will invest $5 million over 20 years in youth sports programs. Moreover, an economic analysis shows the stadium will generate $77.9 million in taxes for the city over the next 30 years. Mr. Reagan presents these factors as evidence that the stadium deal is worthwhile. But here too some perspective is in order:

• The ownership group’s commitment to youth sports is commendable, but this is still a $5 million commitment in the context of a $60 million subsidy.
• The analysis stadium boosters rely on makes rosy assumptions and must (at the very least) be taken with a grain of salt. For instance, it assumes every man, woman, and child will spend roughly $50 on tickets, concessions, and food each time they attend a game, and that spending will increase faster than inflation for 30 years.
• More importantly, most of the economic activity at the hypothetical stadium won’t be “new,” but simply redirected from elsewhere in the city and region. This isn’t money that people were planning to keep hidden under the mattress—much if not most of it would be spent on other entertainment options if there were no soccer games to attend. And let’s not forget the $60 million that businesses are losing because of the use tax. But even assuming proponents’ analysis is correct, the stadium would only bring the city an average of $2.4 million annually—less than a quarter of a percent of the city’s $1 billion annual budget!

The history of stadium deals in Saint Louis and across the country shows these projects fail to make good on the promises made by their promoters. If sports stadiums were such lucrative investments, private investors would be flocking to Saint Louis to get their cut. Despite its supposed virtues, the facts and history indicate that the MLS deal is a bad one for taxpayers. 

The post Cheerleading Won’t Make the MLS Stadium a Good Deal for Taxpayers appeared first on Show-Me Institute.

There are a number of questions surrounding this proposal, and how to fund the Zoo in general. This blog is not the place to exhaustively consider all of them. But there are two essential points that should be at the core of any discussion of the Zoo’s funding future.

First: Should shoppers across the four counties and the city—rich and poor alike—pay for a zoo they may never visit or directly benefit from? Sales taxes are easy to collect, and they can generate significant revenue, but that doesn’t mean they are an economically sound or fair way to fund the zoo. Is it fair to tax someone buying wine in Defiance or Augusta in order to support a zoo miles away in Saint Louis City, that they may never patronize? Moreover, should those in the Zoo-Museum district—working poor included—be taxed twice for the zoo?

One might object that many of the zoo’s visitors come from outside the Zoo-Museum District, often from Saint Charles, Jefferson, and Franklin counties, so they should help pay for this regional amenity. I wholeheartedly agree that those who visit the zoo should pay for it. But a sales tax across those counties would tax far more people who don’t visit the zoo than people who do. As a percentage of total annual visitors, residents from the three above-mentioned counties only comprise 13% of the zoo’s attendance. Now, one could argue that since some people in the Zoo-Museum District pay property taxes for the zoo and never visit, others in the region can make that sacrifice, too. While this reasoning might appeal to those already paying the zoo tax, exporting bad policy doesn’t make it any better.

Secondly: Can the Saint Louis region stomach any more sales tax increases? In many parts of the city and county, sales tax rates are close to 11%, and there is an almost never-ending list of public projects asking for sales tax hikes. In Saint Louis City, a MetroLink expansion proposal includes a 0.5% sales tax hike; in Saint Louis County, Proposition P includes a 0.5% hike for public safety. At what point will the sales tax capacity of the Saint Louis region be exhausted, leaving no room for other projects and initiatives?

It’s important that the zoo has the funds necessary to keep its property and infrastructure in good repair, and no doubt feeding elephants isn’t cheap. But that doesn’t mean just any funding mechanism is appropriate to keep the zoo running. Leaders and policymakers in the region should carefully consider the funding options before them, and not be too hasty to dismiss options like user fees as an appropriate path toward a sustainable funding future.

The post How Should Saint Louis Fund Its Zoo? appeared first on Show-Me Institute.