Everyone wants to help kids thrive, right? Who could be against a new tax in Platte County to help kids get more mental health services? Well, we are. Politicizing charity and mandating it through law is a dangerous path to take. Platte County citizens would be well served to think twice before going down this road.

There is an ongoing petition drive in Platte County to create the Platte County Children’s Services Fund. If approved by voters, the plan would institute a new sales tax to fund mental health services for children in Platte County. It would create a new board in charge of overseeing the collection and distribution of the funds as grants to eligible children’s charities.

Charity should not be politized, yet that is exactly what this proposal will do in Platte County. Several years ago, the children’s service fund in St. Louis County became a flashpoint in the county executive’s race. The fund was slow to distribute money and had grown to a balance of $78 million. That large balance became a point of contention in the campaign, made worse when questionable activities with the funds led to the firing of the children’s service fund director and an FBI investigation. Even without that level of controversy, charities will still be forced to play politics. Board members of various Platte County charities that might receive funds will have to start taking that into consideration when they decide whom to support in various county political races. One can’t risk backing the wrong horse and putting the charity’s funding in jeopardy. It’s machine politics at its most insidious.

Any future Platte County Children’s Service Fund would be a special taxing district, and the last thing Platte County needs is another obscure taxing entity with little accountability and even less oversight. The children’s service fund in Lafayette County, on the eastern edge of the Kansas City region, provides a useful case study for those problems. The fund had operated for years with almost no oversight. Those operating it routinely engaged in improper activities, including funding charities that were affiliated with board members, funding charitable activities that were not eligible for funds in the first place, and funding a private business that wasn’t a nonprofit. After a whistleblower brought this to light, the state auditor investigated and referred the fund to authorities for possible Medicaid fraud. If you think the future Platte County children’s fund will be immune from these incidents, you should disabuse yourself of that notion.

If Platte County voters pass the new tax and create a children’s service fund, will some kids benefit? Of course some will. But citizens need to consider all the possible effects of this endeavor. Creating a new taxing agency with no oversight, entangling philanthropy with politics, and making charities dependent on government largesse is not a recipe for making life better in Platte County. Let’s allow these charities do what they were intended to do—help kids—without the heavy hand of government involvement.

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

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

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

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

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

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

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

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

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

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

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

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

Wrong.

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

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

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

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

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

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

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

Numerous state audits over the past decades have identified the shortcomings of these districts. Now, the Kansas City Auditor has reviewed the use of CIDs in Kansas City and found many of the same issues. Show-Me Institute analysts have written about the problems with CIDs and TDDs for years. Common problems with these special taxing districts include financial abuses, lack of transparency, egregious boundary drawing to avoid voter participation, and much more.

The recent audit of CIDs in KC found many of the same things. From the article in the Kansas City Star (emphasis added):

In recent years, however, several CIDs have been created to benefit a single property owner or developer. In 2016, for example, the Intercontinental Hotel at the Country Club Plaza created a CID for itself to raise taxes earmarked to pay for upkeep of deterioration that the ritzy hotel argued had created blighted conditions. A similar CID was approved for the Romanelli Shopping Center in Waldo in 2019.

Both were criticized for using taxes to subsidize property maintenance. More than half of the existing CIDs in Kansas City benefit a single owner or developer, as opposed to community-based districts like those covering Westport or downtown.

The audit also noted that several CIDs — more than a third — have not submitted their annual budgets to City Hall, a requirement under Missouri law.

Legislation just passed by the state legislature makes some modest reforms to CIDs. These reforms include mandating annual financial reports, competitive bids for contracts, and requiring at least one independent board member. Hopefully, the governor will sign it. But we need to go much further and ensure these taxing districts cannot abuse the public trust for private gain, which is all many of them are good for. (Yes, there are exceptions to that.)

We need far more voter involvement, stricter reporting requirements, tougher limits on which expenditures are allowed, and total tax caps, just to name a few potential improvements. The single most important thing we need is a requirement that a full city (or county, for unincorporated areas) vote to approve all new CIDs and TDDs.  Absent greater reform, these special taxing districts will continue to just be the great Missouri tax-and-spend deception.

The post More Evidence of Failures of CIDs appeared first on Show-Me Institute.

SDs are political subdivisions of the state established to provide very specific services and improvements, such as sewer infrastructure, fire protection, and neighborhood security. Their narrow, singular purpose is why they are known as “special.” In Missouri, SDs can be established to impose and collect tax revenue for a wide variety of purposes. In addition to CIDs there are drainage and levee districts, sewer districts, port improvement districts, nursing home districts, and fire protection districts, to name just a few.

As the auditor notes in his announcement, there are currently 74 CIDs in Kansas City and their use “is growing, and our past audits noted CIDs did not consistently submit required reports to the city, and also identified accountability and transparency issues.”

One problem with CIDs is that they may be created and impose taxes without a vote of the people. CIDs may be formed by nonresidential voters such as commercial landowners and developers. These districts need only a single constituent to be created. As a result, a single landowner can (1) propose a district, (2) cast the single vote to establish the district and approve its revenue sources and projects, and (3) appoint or elect the district’s board of directors, which oversees district business. In short, CID laws allow a single landowner or developer to completely control all aspects of the district.

Given the huge opportunity for abuse, it is important that Kansas City ensure that this important power to tax is respected. In our 2019 paper on these districts, Graham Renz and I suggested a number of reforms for the state legislature—one recommendation requiring the approval of the voters of the entire municipality was passed out of this legislative session. Municipalities may not be able to enact many restrictions on these districts, but they are required to approve their creation in the first place. This effort in Kansas City to shed light on city oversight is welcome and necessary, even if not sufficient by itself.

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In this video, Show-Me Institute Policy Analyst David Stokes gives a nearly comprehensive list of the types of property taxes that exist in Missouri, and what those property taxes support. Many different facilities and services are funded by dedicated property tax districts which often have geographic boundaries independent of the usual city, town, or county boundaries.

Streetlights in This Neighborhood Are Funded With Property Taxes

In this video, Show-Me Institute Policy Analyst David Stokes explains the Elmwood Park Streetlight District. Missouri law permits the creation of independent property tax districts for the purpose of installing and maintaining streetlights in a certain area. The people of Elmwood Park did just that.

Both of these videos are excerpts from a larger look at property taxation in Missouri.

The post Two Short Videos on Property Taxation in Missouri appeared first on Show-Me Institute.

I think that adoption of the charter proposal would benefit the people of Jefferson County. While there are a few parts of it I don’t like, which I discuss in detail in my “Thoughts” piece, on the whole the document is drafted well, and will give the people of Jefferson County the checks and balances that a large county needs. If I lived within JeffCo, I would almost certainly vote for it. (I say “almost” because it is a hypothetical question, and I have to be careful about electioneering.)

One of the best parts of the proposed charter is the way in which it is sure to allow for increasing governmental cooperation by the other entities in the county. That will really benefit the citizens and taxpayers in the long run. There are many other good parts to it, and the members of the commission deserve a great deal of thanks for their time and effort.

From the charter:

3.4.2.22. Cooperate or join by contract or otherwise with any Municipality or Special District or agency thereof, or with the United States of America or any agency thereof, for the planning, development, construction, acquisition or operation of any public improvement or facility, or for a common service; and accept, in the name of the County, gifts, devises, bequests, and grants-in-aid from any Municipality or Special District or agency thereof, or from the United States of America or any agency thereof.

3.4.2.23. Provide the terms upon which the County will perform any services and functions of any Municipality or Special District in the County by agreement of the Municipality or Special District.

On a related note, I thought Franklin County would have the same issue and question on its ballot, but apparently that will be on the April 2009 ballot instead, so I will hold off until then with any comments.

The post One More Ballot Issue to Discuss in Jefferson County appeared first on Show-Me Institute.