Even after reinstating fares, the Kansas City Area Transportation Authority (KCATA) is warning of route reductions because the agency says city funding will fall short of maintaining current service levels. KCATA estimates it needs more than $100 million to preserve existing operations, well above the city’s proposed contribution.

The immediate concern is fewer routes and longer waits for riders. But the larger issue is institutional: KCATA is confronting the long-term consequences of policy decisions that weakened its financial position and eroded confidence among regional partners.

Those problems did not emerge overnight. For years, KCATA relied on temporary funding, emergency appropriations, and optimistic revenue assumptions. Pandemic-era federal aid masked those weaknesses but did not resolve the structural imbalance between operating costs and recurring revenue.

The clearest example was KCATA’s heavily promoted fare-free transit initiative. Supporters argued eliminating fares would improve mobility and reduce barriers for low-income riders. But even at the time, research and the experience of other cities suggested the policy was financially unsustainable.

Fare-free transit eliminated one of the system’s few direct revenue streams while increasing dependence on taxpayer subsidies. Transit fares rarely cover operating costs, but they still provide revenue and impose some fiscal discipline. When federal pandemic aid expired, KCATA faced familiar financial pressures with even fewer tools available to address them.

Acknowledging that reality, KCATA recently announced fares will return next month. Restoring fares amounts to an acknowledgment that the model was not sustainable.

The consequences extend beyond Kansas City itself. Regional transit systems depend on trust among local governments—trust that erodes when the central agency faces recurring fiscal problems.

Some regional governments have already moved to retain greater operational control over their own transit services. In 2022, Johnson County, Kansas, ended KCATA management oversight of its transit operations while continuing limited coordination through the RideKC brand. More recently, several suburban municipalities—including Gladstone, Grandview, and Raytown—have reduced or ended participation in RideKC service.

Obviously, public transit serves a purpose. Many Kansas City residents still rely on buses to reach work, school, and appointments. Like transit agencies nationwide, KCATA is operating in a difficult post-pandemic environment shaped by inflation, labor shortages and changing ridership patterns.

But those challenges make competent governance more important, not less. Municipalities are hesitant to rely on an agency caught in recurring fiscal crises driven by its own policy failures. Fare-free transit generated national attention, but reality eventually intervened.

KCATA’s budget problems are not simply the result of this year’s funding gap. They are the cumulative consequence of years of policy decisions that weakened the authority’s financial position and damaged its credibility.

The post KCATA Is Still Paying for the Fare-Free Experiment appeared first on Show-Me Institute.

Unfortunately, the program has become another way for lenders to target the disadvantaged. I know what you may be thinking if you are familiar with Show-Me Institute’s work. “Wait, I thought you liked privatization?” Yes, I do. But this PACE program really is a combination of the worst of all options. The PACE program:

• Is a government program of questionable need in the first place. Is it really the government’s job to facilitate personal loans for new appliances?
• Was outsourced to the private sector with basically no oversight at all,
• Authorizes private lenders to use government taxing authority to collect on loans. PACE bills can be placed on your tax bill, and if you don’t pay the PACE bills, tax authorities can take your home on behalf of the lenders.

We learned about all of this through terrific reporting by investigators at Pro Publica. Jeremy Kohler and Haru Coryne documented how private lenders were making loans above the value of someone’s entire house at relatively high interest rates to people with risky credit histories. They were targeting these people and doing this precisely because they had greatly reduced risk. If the homeowners didn’t pay, the loan amounts would be put on the tax bills and the lenders would be able to take the homes eventually. Here are examples from the Pro Publica report:

But in St. Louis, an elderly widow said she had no idea she had taken on thousands of dollars in PACE debt, though she saw her property taxes rise sharply. A disabled couple in the Kansas City suburb of Raytown said they weren’t told of the impact on their property taxes; now they’re two years behind on their property taxes.

A Vietnam veteran and his wife in Kansas City are struggling to pay off a $21,658 loan for a solar panel array despite being enrolled in an energy assistance program; they said they just wanted to do something good for the environment.

A PACE loan is NOT a mortgage. Even with a mortgage, the private lender has to go through a civil process with their own lawyers to enforce the loan on the home. With a PACE loan, the county collector is required to do it for them. That is wrong. This situation is like taking out a loan for a new car, and then losing your house if you can’t make the payments. If the PACE private lenders were assuming more risk themselves, they would have been much more careful about their loans.

I have defended the title and payday loan industries in the past. Those companies loan very small amounts compared to what PACE programs will lend you—at admittedly extreme interest rates. But at least when you miss payments to the payday loan company, you don’t lose your home. (My understanding of title loans is they just work with vehicle title.) Those companies take some risk.

PACE lenders basically take on very little risk. Sure, if they loan more than the value of the house and don’t get any money back, you can say they are taking some risk. But how often will the recipient make no payments at all? Between the comparatively high interest rates cited in the articles and the availability of seizure for non-payment, the PACE lenders are incentivized to make large loans to people who might not normally justify the risk.

The St. Louis Business-Journal also has a very good story on this issue this week. There have been bills introduced to reform PACE in Missouri, and reforms are much needed. Some of the true heroes of this fight have been local county collectors who have pushed back against the involvement of their counties in this harmful program.

In my opinion, we should probably get rid of the entire program, but at the very least the ability of lenders to put the loan on your tax bill and take your home if you miss payments must be eliminated.

The post PACE Loans Are Out of Line appeared first on Show-Me Institute.

Now comes a story about the real costs of subsidies to the Walmart in Raytown. According to The Kansas City Star,

In a city of about 10 square miles officers made more than 500 arrests last year at the Walmart store at 10300 E. U.S. 350. The store is the scene of about 30 percent of Raytown’s reported serious crimes.

Meanwhile, Walmart does not contribute taxes for police services. The TIF deal that built the store a decade ago diverts about $300,000 in tax dollars away from public safety every year.

There is no such thing as a free lunch, and politicians who think there is no cost for diverting tax revenue to developers should think again. Walmart often makes for a convenient bad guy, but this same story is being played out with many different businesses. Kansas City, Raytown, and all of Missouri are bearing the burden of these sweetheart deals.

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

Kansas City is home to several great public charter schools. As Robertson reports, Crossroads Academy has a waitlist 150 students long.  Academie Lafayette has a 130-student waiting list. Scuola Vita Nuova has a waiting list of over 60 students, the Kauffman School has a waiting list ranging from 10 to 50 depending on the grade, and University Academy has a waiting list of 9 for kindergarten.

The problem in Kansas City is that there simply aren’t enough great schools to go around.  Families with money can hedge their bets by entering the lottery to get into one of the schools I’ve mentioned, and if they lose they can move to a different district or pay for a private school. Parents without those resources cannot.  Those less-fortunate families live within the Kansas City Missouri School District, but they also live in Raytown, Hickman Mills, Center, and in several of the other districts that overlap with the borders of Kansas City. Charter schools are functionally limited to the KCSD boundaries, so students zoned to attend low-performing schools anywhere else are simply out of luck.

Crossroads Academy has a promising expansion plan, and I’m particularly interested in watching the parent-led Citizens of the World charter school that is slated to open next year, but even with that growth, supply is nowhere close to meeting demand.

Here at the Show-Me Institute, we’ve documented the declining enrollment of the KCSD, and these families’ stories continue to make the case for the correct course of action moving forward. Rather than figuring out the best way to apportion a small number of good seats in schools across the city, why don’t we focus our efforts on creating new seats? Expand good charter schools. Help new schools get buildings.  Allow charter schools to open outside of the narrow bounds of KCSD.

Until we take these steps, we can expect to see a constant stream of stories of families struggling to find places for their children. 

The post Evergreen Headline: Kansas City Needs More Good Schools appeared first on Show-Me Institute.

It is always risky when you make predictions; but aside from the time I bet against the Harlem Globetrotters, I’m doing pretty well. I previously predicted that 2013 would be a banner year for charter schools, and it was. In a December 2013 post titled, “How Choice Changes The Transfer Dynamic in Kansas City,” I predicted that the inter-district transfer law would have less of an effect in Kansas City than it has in the Normandy and Riverview Gardens School Districts in Saint Louis. I wrote:

The existing prevalence of school choice in Kansas City will most likely make the impact of student transfers minimal in comparison to the experiences at Normandy and Riverview Gardens. If school leaders in Kansas City and the surrounding areas handle the situation well, this expansion of school choice could actually benefit the districts and the students.

To date, only 23 children have applied to transfer from the unaccredited Kansas City Public School District to an accredited district. Does this mean that the students don’t want school choice? Not really.

In many ways, charter schools in Kansas City have acted as a release valve. They have provided families with another option and made the prospect of riding a bus or driving to neighboring districts less appealing.

If we think about it another way, the low transfer number demonstrates the positive impact of charter schools. The nearly 10,000 students in Kansas City charter schools would rather stay in those schools than transfer to the Independence, Raytown, Hickman Mills, or other surrounding school districts. It is amazing what can happen when individuals are free to choose, rather than being compelled to send their children to a school that isn’t meeting their needs.

The post Few Students Transfer From Kansas City Public Schools – Thanks To Charter Schools appeared first on Show-Me Institute.

When Homer Tourkakis set up his dentistry practice 20 years ago in Arnold, Mo., he never dreamed that the city could take his well-kept office and give it away to someone else — but that is exactly what the city’s officials are trying to do. Hoping that a new shopping center would generate more tax money than Dr. Tourkakis’ practice, the city declared his building and those around it “blighted,” in an effort to justify giving the properties to THF Realty for construction of the Arnold Triangle project.

Knowing that the state Constitution is supposed to protect Missourians’ right to keep private property, Dr. Tourkakis asked the courts to enforce his constitutional rights and prevent the taking of his business. On January 17, the Missouri Supreme Court will hear his case, and its decision will have repercussions for nearly every home and business owner in the state.

One hundred years ago, there would have been absolutely no doubt that the Court would side with Dr. Tourkakis. Missouri’s Bill of Rights has four separate provisions that emphasize citizens’ fundamental right to keep what they own unless their property is necessary for a true public use, like roads, parks, or public buildings. The early cases interpreting those provisions made clear that the right of individuals to “enjoy the gains of their own industry” was vital and could not be subverted unless the government proved the necessity of violating that right.

During the last 50 years, however, judges have steadily given municipalities, unelected government authorities, and even some private companies more and more power to take homes, businesses, and houses of worship from their owners so that other private interests could profit from them. This is usually accomplished using a legal loophole that allows municipalities to condemn properties, and possibly entire neighborhoods, in areas they deem “blighted.” Dozens of Missouri cities have applied blight designations to thousands of normal, well-kept properties in order to create sweetheart deals for commercial developers. As a result, Missouri has developed one of the nation’s worst records for eminent domain abuse.

These sorts of abuses have been pervasive among cities in the Saint Louis metro area.  For example, the city of Sunset Hills only recently ended a seven-year nightmare for more than 300 citizens threatened with condemnation in the name of redeveloping what had been a perfectly normal neighborhood. Eureka designated as “blighted” more than 900 acres of the old Allenton area to intimidate unwilling homeowners into selling their properties to the developer of Eureka Commons — eventually leading to several uses of eminent domain. Meanwhile, Valley Park’s residents have been forced into a state of perpetual anxiety because of the city’s repeated efforts to designate homes and businesses as blighted in order to attract commercial developers.

The Kansas City area has also seen its share of cities abusing eminent domain. The city of Liberty threatened to condemn Liberty Christian Union Church, two charities, and several small businesses to make way for the Liberty Triangle development. Despite the developer’s insistence that it does not plan to use eminent domain, Raytown’s downtown redevelopment plan reserves the right to take homes and businesses whose owners prove unwilling to sell on the city’s terms. Meanwhile, the Sugar Creek Board of Aldermen is using the city’s own negligent upkeep of roads, sidewalks, and utility lines to “blight” more than 70 homes and businesses so their owners can be forced to sell them to the city’s chosen developer.

In addition to the widespread use of eminent domain in Missouri’s major metropolitan areas, many smaller cities in more rural areas have demonstrated a willingness to sacrifice their citizens’ rights in the pursuit of higher tax revenues. The city of Branson condemned two properties and used threats of eminent domain to force Harvest Evangelical Free Church and a number of businesses to make way for a Bass Pro Shop, hotels, and luxury condos in the Branson Landing development. Rolla spent four years tailoring its blight findings to suit potential commercial developers and threatening eminent domain against the affected properties before finally allowing the rightful owners to manage the area’s redevelopment. Meanwhile, Ozark’s City Council recently voted unanimously to leave in place a blight designation whose 47 acres include numerous well-kept properties near the Finley River. Even though the city recently passed an ordinance forbidding the use of eminent domain for its redevelopment project, the threat to property owners will only truly be extinguished if the bogus blight designation is lifted.

When the Missouri Supreme Court hears arguments in City of Arnold v. Tourkakis on Thursday, it will have to choose between two very different paths. The Court could side with the city and its commercial developers, meaning that virtually every home, business, and house of worship in the state could be condemned and given away for the profit of a government-chosen owner. Or the Court could turn the tide in favor of individual liberty by deciding that the state Constitution’s protections for private property still have meaning. So watch this case carefully — your constitutional freedoms are hanging in the balance.

Dave Roland has litigated eminent domain cases in state and federal courts and has offered expert testimony on the issue to state legislatures. He is a policy analyst at the Show-Me Institute, a Missouri-based think tank. The Show-Me Institute’s “friend of the court” brief in City of Arnold v. Tourkakis is available online.

The post Will the Missouri Supreme Court Leave Your Home At Risk? appeared first on Show-Me Institute.

I searched but was unable to find a list of the largest cities in America that use a city manager. Kansas City has to be right at the top, though, making Mr. Cauthen sort of a star in the industry. Cincinnati is well-known for being a forerunner in this form of government, but most large cities, like St. Louis, still use the more well-known mayor-council form. The job of city manager is also notoriously unstable, as Mr. Cauthen is seeing right now.

38 cities in Missousi use the council-manager form of government, including my home of University City. The essential points of this system are that the elected mayor and city council leave the day-to-day operations of the city to the manager, usually someone with a background in government and degree in a related field like urban planning. The mayor and council then focus on the larger issues, and give final approval to those decisions of the manager that require legislation, such as contracts. One rule often held in council-manager cities is that it is improper for the elected officials to contact municipal employees directly — they must go through the city manager. Often, the single most important decision a council makes is whom to hire as city manager.

Approximately 150 Missouri cities use the closely related city administrator form of government. This form is used in cities such as Kirkwood, Arnold, St. Charles, Jefferson City, Chesterfield, and Raytown. In this form, the mayor and council appoint a professional city administrator to run the city, but the mayor and council retain more control of certain operations. In reality, the daily jobs of city managers and city administrators are very similar, but city managers rank higher on the occupational totem pole.

I have generally been very impressed by the people I have met who are city managers and administrators. In my opinion, the key to the job is not falling too much in love with government itself, and to recognize and accept the limits of what government can do. In most cities, the city manager or administrator is extremely powerful, because part-time elected officials just do not have the opportunity to know everything there is to know. This is, of course, sort of the point, but if the city manager or administrator falters, it may take awhile for the council to become aware of it. Something like that happened in Crestwood a few years back, if I recall correctly.

I have no idea what will happen to Mr. Cauthen in Kansas City. In the larger cities that use city managers, like KC, and have full-time mayors, it is no doubt imperative that they be able to work together. I would love to see some type of city manager system brought to St. Louis, but I might as well wish for Microsoft, Exxon, and the Bank of England to relocate here while I am at it, for all the good it will do.

The post City Manager on Hot Seat in Kansas City appeared first on Show-Me Institute.