Missouri’s property tax system works best when the assessments are accurate, the tax base is wide, and the rates are low. That combination will help grow Missouri’s economy for everyone while properly funding the necessary functions of local government. However, a radical change in the system is being put before voters in Webster, Christian, Lawrence, and Dade counties in April. These four counties will vote on whether to prohibit any property tax increases due to reassessments. Current law requires local governments to roll back tax rates as assessments increase, but we all know that taxes still go up, sometimes substantially.

At the Show-Me Institute, we support low taxes, and I am well-aware of how tempting this will be to voters. But using market valuations in reassessment to set tax levels is a good system. While our property tax system needs reforms, eliminating any and all tax increases from reassessments will make Missouri more dependent on other taxes that hurt our economy far more than property taxes do. Hate them as much as you wish, but property taxes indisputably harm economic growth less than other taxes do.

These property tax limitations would reduce the ability of school districts to fund themselves and would make them more dependent on state aid. Consider the following: school districts in St. Louis County regularly receive at least 80% of their funding from local sources, primarily property taxes, and some are over 90%. It is nowhere near that level in Southwest Missouri. Nixa school district in Christian County is only 54% locally funded, while Marshfield school district in Webster is only 46% locally funded. Even Springfield school district, the largest school district in Greene County, where no property taxes changes are proposed, is only 58% locally funded. These changes would make school districts in these counties more dependent on state aid, not less. Again, I’m aware that many voters may view that as a benefit, but it is anything but.

Numerous other harmful effects would come from diluting the market forces (in the form of assessments based on market values) that form the basis of property taxation. California provides us with an example of the harms of these types of property tax caps with its famous Proposition 13, passed in 1978, which dramatically limited increases in property assessments and taxes. Proposition 13 certainly had its intended effect of lowering property taxes for California homeowners. However, it also reduced mobility, significantly increased alternative taxes, limited homeownership opportunities, and caused substantial tax disparities for similar properties receiving similar services. These negative consequences are exactly what these four counties would experience over the long run.

There are also significant constitutional concerns with this legislation. Missouri Constitution Chapter X, Section 3 states that “taxes . . . shall be uniform upon the same class or subclass of subjects within the territorial limits of the authority levying the tax.” So, consider the issue of the Logan-Rogersville R-VIII school district. This school district serves families in three counties. If voters approve these tax changes, the property tax system in one of those three counties would remain unchanged (Greene), while in the other two (Webster and Christian) it would be illegal to have a tax increase from reassessment. It would certainly seem unconstitutional for property owners within the same taxing district who own the same type of property (single-family homes) to face different tax and assessment systems for the same services.

We need property tax reform in Missouri, but this total limitation is too severe. If enacted, the property tax proposals before the voters in these four fast-growing counties would make the region’s overall tax system worse, not better. I hope voters will look past the easy appeal of a tax limit to think about the long-term harms.

The post The Wrong Way to Fix Property Taxes appeared first on Show-Me Institute.

On November 4, Springfield voters will decide on a proposal to increase the city’s hotel tax by three percent. The proceeds from the new tax will help fund a new convention center for the city. A recent report paid for by the Visit Springfield tourism bureau said exactly what Visit Springfield wanted it to say: that a new convention center will generate enormous revenue for the Springfield area. The report claims a new convention center will drive $1.3 billion in new spending over the next 30 years. Exaggerated estimates like this one have been made on behalf of convention centers all around the country for decades, and the historic evidence is clear that Springfield voters should be dubious of such claims.

Between now and November, Springfield residents who visit St. Louis should drive by the largely empty dome attached to St. Louis’s downtown convention center to see how these convention center promises often play out. That dome was a part of a large convention center expansion in the 1990s. The same promises of growth, revenue, and utopia were all made when St. Louis voters approved a similar hotel tax increase back then. Now the dome is mostly empty, and the regional body that manages it is struggling to pay for its upkeep. St. Louis’s local tourism agency thinks the solution is the same thing it always is: further expansion of the convention center. Like a Cold War general in a Kubrick movie or a carpenter with a box full of nails, tourism agencies have the same solution for every problem. Economic recession? Expand the convention center. Economic growth? Enlarge the convention center. Global nuclear war? Definitely gonna need a bigger convention center to commiserate in.

The increased hotel tax isn’t the only public money being used as part of this plan. Other local sales taxes are slated to be used for funding, and state tax dollars are being considered. Tourists, Springfield residents, and possibly all of Missouri will get to pay for this new event space, whether it is actually needed or not.

Haywood Sanders is a researcher and writer with the University of Texas–San Antonio who has studied convention center expansions for decades. He has documented how cities and tourism agencies systematically inflate projections to get these projects approved. Sanders has reviewed the Springfield convention report and noted in an interview with a Springfield News-Leader reporter earlier this year that the report didn’t state how it calculated its room occupancy estimates and ignored underwhelming numbers of comparable convention centers in Overland Park, Kansas, and St. Charles, Missouri. Sanders states that the convention-center industry peaked in the early 2000s and shows no signs of returning to the success it enjoyed back then. With two major convention areas so close by in Branson and Lake of the Ozarks, a new center in Springfield will face intense competition. But I have no doubt that local Springfield convention-center boosters will ignore reality in their quest for tax revenue and city spending.

Visit Springfield wanted a report that claims a convention center will be an economic boon for the city. They got it. As Springfield residents prepare to decide on the hotel tax increase proposal, they should study the work of Heywood Sanders and others to learn about how these claims have been made about many other convention centers in many other cities, and how they usually fail. Springfield voters can also go to St. Louis to see the failures of these promises with their own eyes. Taxpayers should not be on the hook for convention centers whose overstated benefits, such as they are, will largely go to private entities. This is the Show-Me State, and the claims being made by supporters of the convention center for Springfield should be met with a healthy dose of skepticism by voters.

The post Springfield Voters Should Be Skeptical About Convention Center Claims appeared first on Show-Me Institute.

Of Missouri’s four largest cities—Kansas City, St. Louis, Springfield, and Columbia—Springfield will soon be the only one without charter schools. Charter schools are already thriving in Kansas City, and St. Louis and thanks to recent legislation Columbia will have its first charter schools up and running as early as 2026.

Springfield is missing out.

Charter schools are public schools that are exempt from some of the rules and regulations that apply to traditional public schools. In most Missouri counties, including Greene County, charter schools are not allowed to operate unless they are sponsored by the local school board—a requirement that effectively bans them. Senate Bill 727, signed into law in 2024, changed this requirement in Boone County, where Columbia is located. We need similar legislation in Greene County.

Why? There are several reasons—including that charter schools are popular with families—but the most important reason is that charter schools are more effective than traditional public schools. Academic studies consistently show students who attend charter schools outperform their peers in traditional public schools on state exams and are more likely to attend college. In some cases, the performance differences are substantial. A recent national study by the Center for Research on Education Outcomes (CREDO) at Stanford University found that charter schools deliver additional academic growth equivalent to 6 extra days of instruction in math each year, and 16 extra days in reading, compared to traditional public schools. This same study shows that Missouri has some of the most effective charter schools in the country.

Charter school impacts are largest in areas where the local neighborhood schools are underperforming. Does Springfield have any low-performing neighborhood schools? Unfortunately, it sure does. At Westport Elementary School in 2024, only 24 percent of 5th-graders scored proficient or higher on the state English Language Arts test, and in math the number was just 14 percent. At Parkview High School, only 16 percent of students who took the Algebra I end-of-course exam scored proficient or above.

Now imagine your child is zoned for one of these schools and unless you move—perhaps not in your budget—this is where he or she will be required to attend. Charter schools give families in this situation new hope. Many charter operators intentionally open schools in neighborhoods where the traditional public schools are the worst—their mission is to provide educational opportunities in these communities that are not otherwise available. In many cities, the top charter schools have long waitlists.

If we want more Springfield children to have access to highly effective schools, permitting charter schools to operate in Greene County is one of the simplest ways to do it.

How can we make this happen? Following Boone County’s playbook, we need a champion for charter schools in the state legislature who will prioritize this issue in the upcoming legislative session. For Boone County, that champion was Caleb Rowden, a longtime charter advocate. Education legislation in Jefferson City is increasingly “omnibus” style, which means multiple different education policies are bundled into one bill. Rowden made sure that permitting charter schools to operate in Boone County, without the requirement that they be sponsored by the local school board, was part of the 2024 omnibus bill.

Will someone step up in a similar manner for Greene County? I sure hope so.

Charter schools are public schools, their students are public school students, and their teachers are public school teachers. They cannot charge tuition, they’re secular, and they’re open to all students (they must admit students by lottery if the number of applicants is greater than the number of available spots). We know charter schools work and that they’re popular with families.

Every year that passes without charter schools operating in Greene County is a missed opportunity for Springfield’s children.

The post Springfield Needs Charter Schools appeared first on Show-Me Institute.

While I will avoid any spoilers, the new movie, Mission Impossible: The Final Reckoning, has an eerie resemblance to current events. The seventh and eighth films in the franchise revolve around a rogue artificial intelligence (AI) entity taking over cyberspace, with different nations racing against the clock to capture this entity and dominate the rest of the globe. The plot today may be different, but the emerging battle for AI-supremacy seems similar.

Recently, President Trump issued four executive orders aimed at unleashing nuclear energy to establish America’s “energy dominance” and maintain national security amid a potential global AI arms race. These orders could lead to the repeal or reform of burdensome regulations that have constrained the American nuclear industry in past decades. Did I expect national security to be a key driver of nuclear energy reform? Not exactly, but this is not an unprecedented scenario.

From the Battlefield to the Home Front

At the height of World War II, nations began working to apply atomic physics to wartime technology. This led to America achieving the world’s first self-sustaining nuclear reaction under the stands of Stagg Field in Chicago. While nuclear technology’s first use was in the atom bomb, its debut as an energy source came soon after with the launch of the USS Nautilus in 1954.

Since then, the technology has had a prominent role in both military and civilian affairs. Nuclear reactors are used to power submarines and aircraft carriers, and 19 percent of the United States’ electricity generation comes from nuclear power plants. National security had a role in its origin story—and now, it may be a factor in the nuclear industry’s resurgence as well.

An Opportunity for Missouri

To win an AI arms race, speed and time are of the essence. Missouri could position itself as a strategic partner by finding ways to more quickly connect new nuclear power to energy-intensive AI data centers.

One policy that could shorten the time of construction of nuclear power plants and also protect Missouri consumers from price hikes is consumer regulated electricity (CRE).

In theory, CRE would allow private investors to create new, independent electric power systems (encompassing both generation and transmission) using their own capital. These private grids would be scaled to meet new demand growth from large consumers. In order for a CRE entity to operate appropriately, it would need to be free from restrictions placed by the Missouri Public Service Commission (MPSC). That means CRE systems would need to be unconnected to the regular grid and serve only new industrial and large commercial customers—like AI data centers.

CRE could not only attract investment but also relieve strain on the primary grid and ratepayers. Rather than relying on ratepayers to fund new power plants to accommodate rising electricity demand (driven by large consumers), CRE could provide a targeted solution. New Hampshire passed a CRE measure this year, and Missouri may benefit from evaluating how its statutes could be amended to allow for such innovation.

By connecting it directly with national security, the Trump administration has made the development of nuclear-energy infrastructure an urgent priority. The mission for Missouri—if our policymakers choose to accept it—is to position the state to take part in the revitalization of nuclear power and reap the accompanying economic benefits. Adopting CRE is one important way in which Missouri could help meet the nation’s needs while benefiting in the process.

The post Mission Impossible and Nuclear Energy: President Trump’s New Executive Orders appeared first on Show-Me Institute.

The primary candidate under consideration now, David Cameron, the current city manager in nearby Republic, is controversial, so I read, because he is a “disrupter.” That’s great if you are leading a start-up in Silicon Valley. Is it great for a midwestern city? You tell me. According to the story in the News-Leader:

David has probably stepped on a few toes along the way, it would be impossible, unrealistic to think that you would be able to make everybody happy in the process of doing your job,” [Springfield Chamber of Commerce Chairman, Bob Helm] said. “His leadership style is bold. He operates with confidence. He’s become a great problem-solver and has also been very responsive to those who approach him along the way.

If his disruptive leadership style is used to push the city employees in Republic, to work harder, then that sounds great to me. If is it used to think “bold” and offer lots of tax incentives, then count me out. Here is a story about how Republic gave a big tax break to Amazon to open a distribution center there and how the city manager got a pay raise because of it. (The story is also noteworthy as it does a good job of looking at all sides of the issue instead of just repeating press releases from the government about how great tax incentives are.)

Too often, “visionary” or “bold” local leadership just leads to local delusions about how great a city can be instead of just trying to provide the necessary services to its residents.

In fairness to Republic, the city, overall, doesn’t appear to offer that many tax incentives, so legitimate criticism of the Amazon deal needs to acknowledge that. In Springfield, they are taking their time to decide on the city manager position, and getting that decision right is worth the wait.

For much more on the evidence about the plusses and minuses of professional city management, check out my first free-market municipality guide, which goes into that debate in detail.

The post Springfield Takes Its Time Hiring a City Manager appeared first on Show-Me Institute.

Missouri lawmakers are considering a change to the performance levels the state uses to categorize students based on end-of-year test scores. Currently, Missouri categorizes students into one of four performance levels. From lowest to highest, these are: (1) below basic, (2) basic, (3) proficient, and (4) advanced. I believe the meaning of these categories is self-evident, as it should be.

A proposed change in House Bill 607 would add a fifth performance level, called “grade level,” which would fall below the “proficient” category and above the “basic” category.

Wait, what? What does testing at a “proficient” level mean, if not testing at “grade level?” And how can a student test at grade level but not be proficient? Digging a little deeper, the bill defines a student as “proficient” if the student can: “Demonstrate mastery over all appropriate grade-level standards and has introductory-level knowledge for the next grade or level of education.” When I think of what the word “proficient” is intended to communicate, this sounds about right.

But what, then, does the new “grade level” category mean? According to the bill, it also means that the student: “Demonstrates mastery over appropriate grade-level subject matter.” However, it goes onto indicate that a grade level student: “May be ready, with appropriate reinforcement, for the next grade or level of education.” This means that a student could be classified as testing at grade level on end-of-year assessments, even if he or she is not fully ready for the next grade. This does not sound like “grade level” performance to me, and I suspect many Missourians would agree.

This matters for two reasons. First, in case you haven’t been paying attention to national education headlines recently, student learning has been declining for about a decade now, and the decline has accelerated since the COVID pandemic. Missouri is no exception to the national trend. In the face of disappointing academic outcomes, it is important to maintain clear and rigorous standards. We should continue to demand the best from Missouri children. This watered-down version of “grade level” performance seems like a step in the wrong direction, like an implicit acceptance of the fact that our children are learning less in school than their counterparts from a decade ago.

Second, consider when schools and districts report out to the public on student performance. With this new category, they’ll be able to report on the share of students who are performing at “grade level” or higher, but this will not mean what most people will think it means. If I hadn’t read the language of the bill myself, I certainly would not understand it. The definition of “grade level” in the bill, as quoted above, is more appropriately communicated by the term “basic,” which is already a performance category. I want our schools to report on student performance in a transparent manner, rather than obfuscating it.

At first glance, how the state chooses to report out on student test performance may not seem like a big deal. But the more I think about it, the more this bothers me. I cannot think of a single positive rationale for doing this. It is certainly not aspirational. I don’t think it is a stretch to call it dishonest.

I hope the lawmakers in Jefferson City reject this change in the interest of maintaining high standards for our children, and promoting transparency in Missouri government.

The post Legislating Lower Standards for Missouri’s Children? appeared first on Show-Me Institute.

Elections and inaugurations are a time for reflection and a recommitment to principles. As Missouri prepares for the new administration of Mike Kehoe, it’s worthwhile to consider the performance of his predecessors—especially on issues relating to fiscal management of taxpayer resources.

The Cato Institute, a libertarian-minded think tank based in Washington, DC, rates the fiscal performance of governors. The good news is that Governor Mike Parson is not the worst governor in the United States, but he’s the worst one who claims to care about limited government.

Cato has issued its report every two years since 1992. The report methodology, available online here, issues a letter grade based on each governor’s success at restraining spending and tax increases. Parson earned a D grade in 2024. Author Chris Edwards wrote, “Parson has been a tax reformer, but he has dropped the ball on spending control. The general fund budget has jumped from $10.5 billion in 2022 to an expected $15.6 billion in 2025, a 49 percent increase in just three years.”

The D grade placed Parson 40th of the 48 governors rated. Florida governor Ron DeSantis was ranked 19th and Virginia Governor Glenn Youngkin came in 15th. Parson was closer to Minnesota governor and recent vice-presidential caudate Tim Walz, who came in last. Of Missouri’s neighbors, governors of Iowa, Nebraska, and Arkansas each earned an A grade, ranking 1st, 2nd and 4th respectively. Even Illinois governor J.B. Pritzker and California’s Gavin Newsom outperformed Parson, placing 32nd and 35th respectively.

If one uses Republican party identification to denote a preference for small government and low taxes—and that is arguable these days—Parson’s 40th-place ranking stands out even more. It made him the worst-scoring Republican in the nation. And 2024’s score is not a fluke; Parson scored a D in 2022 and a C in 2020.

Parson doesn’t just compare poorly to other current governors; he scored poorly compared to past Missouri governors. Parson’s letter grades surpass only those of Mel Carnahan (scoring D, D and F) and Robert Holden (F). Parson even seems to score worse than Jay Nixon, whose scores were B, C, D, and D. (If you’re wondering, Matt Blunt was the best scoring governor since 1992, earning Missouri’s only A in 2006 and a B in 2008.)

Note that the report’s methodology changed for the 2008 report but has remained the same since. Previous iterations relied on many more variables, but the outcomes are unlikely to have been much different.

Missouri’s total spending has practically doubled in the last five years, including not just the general fund, but other dedicated state funds and federal money. That total spending jumped from $27 billion in 2019 after Parson’s first year in office to a little more than $50 billion for 2025. It now costs three times as much to run Missouri as it did in the Carnahan and Holden administrations!

Parson’s profligacy stems from the decisions he’s made since the federal government’s COVID relief funds flooded Missouri’s budget with billions of dollars in one-time cash. States were given considerable discretion on how to use much of the relief funding, not to mention the state tax dollars the federal cash freed up for other uses. Unfortunately, Parson, with the help of Missouri’s General Assembly, fell victim to the allure of so-called free money.

Today, Missouri’s budget is littered with what were once temporary initiatives that never ended and now receive permanent funding. Or, perhaps worse, formerly federal obligations that are now borne by state taxpayers.

Key among these includes Parson’s decision to use state funds to maintain the higher childcare subsidies the federal government subsidized during the COVID pandemic, now costing state taxpayers at least $70 million annually. Parson also failed to meaningfully manage Medicaid spending. Missouri’s lackadaisical approach to checking program recipient eligibility, after the federal government lifted its COVID-era ban on the practice, has likely cost taxpayers hundreds of millions of dollars thus far.

In addition, Parson increased state employee pay by 7.5% plus an additional 3.2% cost of living increase last year. These raises were paid for with a temporary influx of state funds, but because the increased pay was not made commensurate with employee reductions, the higher salaries will require new permanent funding sources and will increase the obligations of the already underfunded state pension system.

Governor-elect Kehoe has a difficult job ahead of him administering government and working to attract more families and employers to the Show-Me State. Unfortunately, his predecessor has done him—and the people of Missouri—a great disservice by failing to properly manage taxpayer funds.

The post Missouri Must Do Better at Controlling Spending appeared first on Show-Me Institute.

When Missouri voters approved the ballot initiative legalizing marijuana in 2022, one part of the plan authorized cities and counties to enact a three-percent tax on marijuana sales in their communities (once again upon voter approval). Many cities proposed such taxes in 2023, but several cities in the greater Springfield-area waited until 2024 to consider it, including Nixa, Republic, and Rogersville.. The argument in favor of voters approving the tax is straightforward enough, but the debate over what to do with the new tax revenue is more complex.

“Pigouvian” taxes are taxes levied on certain goods to address their negative effects. They are common and include special taxes in Missouri on items like cigarettes, alcohol, and pool tables (yes, really, pool tables). Tobacco and alcohol consumption impose certain costs on society, and the extra tax revenue can be used to fund services to address those negative effects, like lung cancer research and drunk-driving enforcement. In addition, the taxes make the item more expensive, thereby reducing consumption. Elsewhere, for example, gas taxes may be quite high not only to fund roads but also to encourage public transit. Marijuana legalization will indisputably have some negative societal effects, and the three-percent local sales tax on it can help fund services like municipal police efforts to mitigate those negative impacts. Also, life is not a Cheech and Chong movie—dare to dream that it were! —and cheap pot really doesn’t do anyone much good. I generally support neither new nor high taxes, but the argument in favor of these new local marijuana taxes is strong.

What to do with the money is a more difficult issue. There are two questions: Should the revenue be dedicated to certain uses or sent to the general fund? And should it serve as new revenue or be used to cut taxes elsewhere? Directing taxes into the general fund gives local officials more flexibility to address local needs, but earmarking taxes improves both voter and elected-official decision-making and accountability. In some cases, as with cigarettes, the harms to society are easy to determine. Accordingly, the choice to earmark tobacco taxes to health-related fields, as we generally do in Missouri, is defensible. Legal marijuana, however, will be more like alcohol, with costs and harms to society spreading across a variety of sectors. Should the new sales tax revenues go to policing? Health care? Family services? Who knows? This is why alcohol taxes generally are not earmarked in our state, nor should local marijuana taxes be in these three cities. (However, focusing at least some of the new marijuana taxes on policy services would make sense.)

Politicians will try, as is their wont, to treat the new marijuana tax revenue as manna from heaven. Voters should demand more from them as we approach the elections. A new marijuana tax should not just be an opportunity to raise more revenue. It should also be an opportunity to replace other, more economically harmful taxes. Republic, in particular, has a high local sales tax at 3.125 percent, and perhaps the marijuana tax could be used to lower or eliminate other sales taxes.

Marijuana taxes are an opportunity to improve both the current budgets and the long-term tax environment for cities and counties. Voters in Nixa, Republic, Rogersville and anywhere else with a marijuana tax on the ballot should demand a plan that does both.

The post Pot Taxes Can Help Municipal Kettles Get into the Black appeared first on Show-Me Institute.

There is probably no better opportunity for counties and municipalities to share services and save tax money than in emergency 911 dispatching services. As vital as the service is, if the technology is effective and the operator is properly trained, it makes no difference if the emergency call is answered down the block in New Madrid, Missouri, or across the ocean in old Madrid, Spain.

In southeastern Missouri, Perry County and the City of Perryville reviewed numerous options for upgrading their 911 system. In late 2023, they determined that the best option from a service and cost perspective was to contract with neighboring St. Francois County, which has already implemented the improved technology a modern 911 system requires. Perplexingly, some residents of Perry County have objected to this.

According to news reports, the main objection is the loss of a few 911 system jobs, as if the main role of local government is to keep as many people on the payroll as possible. That’s how political machines function, not quality local government. The objectors have succeeded in putting the consolidation question on the upcoming April election ballot. Hopefully, the voters will value tax savings and improved public safety over government job protections.

Many counties and cities around Missouri share emergency operations dispatching. County sheriff’s departments can do more than simply share service with other county sheriffs; they can operate together with city police departments, fire districts, university police departments, ambulance districts, and more. The economies of scale here allow for implementation of better technology in larger 911 systems, saving taxpayer money. The city of Flint, Michigan, saved over a million dollars a year and was able to eliminate 23 positions by joining the Genesee County 911 system.

To give a Missouri example of savings for taxpayers, Lake Ozark recently contracted with Miller County to handle its 911 system. Lake Ozark will save around $200,000 per year in direct costs while avoiding spending even more to upgrade its own soon-to-be obsolete 911 system.

Closer to Perry County, the Cape Girardeau County sheriff’s 911 dispatch system handles calls not only for the sheriff but also for eight other fire and ambulance districts and police, fire, and ambulance calls for Jackson. Does anyone seriously think the public would be better served with 10 different 911 systems in the county, each one struggling to hire and train employees and regularly upgrade expensive technology?

For one final example, in 2016 the City of New Madrid and New Madrid County partnered to consolidate their 911 systems and upgrade their technology. I hope the citizens of Perry County realize how common and beneficial these types of partnership are in Southeast Missouri.

Saving money by sharing the costs of technological improvements is more important than ever since salaries for 911 dispatchers are increasing substantially in an effort to recruit more people to the job. Currently, staffing shortages are the major problem facing dispatching systems all over the country, and have been partially responsible for recent 911 system problems in Kansas City and St. Louis. Maintaining multiple systems requiring more employees using lesser technology isn’t going to help the people of Perry County.

These are just a few good examples of 911 consolidation around Missouri. While there are many success stories in both urban and rural parts of our state, numerous opportunities for change still exist. Wherever you are in Missouri, enhanced public safety technology and more efficient use of tax dollars through 911 consolidation are two things we can all support. Hopefully, the voters of Perry County will recognize these benefits in April.

The post 911 Systems Are a Great Opportunity for Local Government Cooperation appeared first on Show-Me Institute.

If I offered you $100,000 a year for the rest of your life to retire from your current job, would you take me up on the offer? What if I said you could have the money and also get a different job if you wanted? If you would answer yes to these questions, you have gone a long way toward understanding why turnover is high among public school superintendents. We financially incentivize them to “retire.”

Take a look at the recent article from Springfield News-Leader’s Claudette Riley, in which she discussed the problem of superintendent turnover. Nearly every person cited in the report was a superintendent who has retired and is working another job. Doug Hayter retired as superintendent of Branson Public Schools; he now draws his retirement benefit and serves as the executive director of the Missouri Association of School Administrators (MASA). Kelly Hinshaw and John Jungman, also quoted in the report, are retired administrators who now work for MASA.

Given the rules of our current state pension system, it makes financial sense to do just as these folks have done. Consider some of the other retiring superintendents listed in Riley’s report. Shawn Randles is retiring from the Logan-Rogersville School District. After a 31-year career, he’s eligible to draw 75 percent of his final average salary of $152,002 for the rest of his life. Depending on the payout he chooses, this could be as much as $114,000 a year. According to Riley, Randles “plans to start a second career in an education-related field.”

Chris Ford, Fordland’s “retiring” superintendent is in a similar position. He’s eligible to draw $108,000 a year for the rest of his life while continuing to work. He has taken a position at Evangel University.

We are told turnover among superintendents is high because the job is stressful. It is curious then that many retire and take up similar positions in other states. Take Crane’s retiring superintendent, Chris Johnson, who has accepted the superintendent post in Prairie View, Kansas.

Stress may be a factor, but the truth is that superintendent turnover is high because our state’s pension system makes it financially beneficial for our veteran administrators to leave. They can earn more by retiring than they could if they kept working.

As Riley’s piece explained, superintendents are eligible to retire after 30 years of service in the profession or after their years of service plus their age equal 80. This means that someone who starts teaching right out of college could be eligible for retirement by their mid-50s. These individuals can then draw their pension and take on new roles, as long as those roles are not covered by Missouri’s Public School Retirement System.

We should applaud efforts to mentor and train superintendents, but if we truly want to reduce turnover the solution is clear—we must change our retirement system. This does not have to mean abandoning the current defined-benefit pension system, though offering a defined-contribution option is something that should be considered. The solution could be as simple as allowing superintendents to draw early disbursements from their pension fund while retaining their current jobs. This would diminish the financial pull to retire and take up a new job in another state or outside of PSRS.

As long as we continue to make it financially lucrative to retire, we will continue to see our best educational administrators retire shortly after they hit year 30.

The post To Reduce Superintendent Turnover, Change the Pension System appeared first on Show-Me Institute.

In July 2010, Missouri politicians joined the state’s economic development agency to announce the awarding of $17 million in state tax incentives, along with $39 million in local tax subsidies, to the Mamtek project in Moberly. The project called for making artificial sweetener using a process that would start in China and finish at a new plant in Moberly, creating 600 local jobs here. There was just one problem—it was all a scam.

It may seem unfair of me to criticize a government agency for falling victim to a criminal conspiracy, albeit one that really wasn’t that sophisticated, but government economic development agencies are a Catch-22 for taxpayers. When they do a bad job—as they did in Mamtek—they waste our tax money. As with the Bass Pro Shop in Independence and the Jamestown Development near Springfield, we can list plenty of private business projects government had no reason to get involved in but did to the detriment of taxpayers. But we can only wish they always did a bad job. It’s when they do their jobs right that taxpayers and average citizens really get burned.

When economic development officials do their jobs right, all they are really doing is subsidizing economic activity that likely would have happened anyway for the benefit of politically connected companies. As the old joke goes, economic development officials are great at creating jobs for other economic development officials. For everyone else, not so much. For all their skillful use of political buzzwords and claiming credit when none is deserved, it remains true that “government is a bad venture capitalist,” to quote President Obama’s economic advisor, Larry Summers. Summers was being polite. Government, in the form of local, state, and federal economic development agencies, is a terrible venture capitalist. It’s not that government officials don’t get their bets right often enough; it’s that they actively get them wrong because economic development officials are heavily influenced by the political incentives to reward supporters of the politicians who employ them. A short-term political payoff is more important than long-term success.

Late to the subsidy game but catching up fast, Springfield—having seen how St. Louis and Kansas City have operated their own subsidies and failed by every measure—has decided to follow in their footsteps. The trucking industry has long been important in Southwest Missouri, and there are numerous companies, stations, and stores in Springfield to service the various fleets. But not enough for the City of Springfield’s Department of Economic Vitality (that’s its actual name), which decided to use over $4 million in taxpayer funds (along with other subsidies) to entice an enormous new gas station company, Buc-ee’s, to locate in town.

The head of another local convenience store company, Rapid Robert’s, rightfully took issue with the plan. He didn’t object to the competition, but rather the use of tax subsidies in a field full of local companies that had grown without them. His objections fell on deaf ears, and likely would have been meaningless to the members of the city’s “economic vitality” department. They, like economic development officials everywhere, care nothing about history, propriety, or capitalist theory. They care about getting the forms marked up, the tax money spent, and the deal done so that they can claim credit, add it to their resume, and start searching for the next job.

Economist Dick Netzer mocked the exaggerated claims of success made by economic development officials when he wrote, “Who needs oil wells, when a state can be another Kuwait just by increasing the budget of a tiny agency?” Claims of subsidy successes often border on the absurd. The author once heard a Clay County economic development official claim that “All of the growth” in the town of Liberty—a fast growing, exurban community north of Kansas City, the likes of which have been growing across the nation for decades—was due to a tax-increment financing (TIF) package they passed. As if suburbanization hadn’t existed until Missouri’s TIF law was passed in the late 1980s.

Economists Alan Peters and Peter Fisher studied tax incentives closely and concluded that they work about 10 percent of the time and are simply a waste of money the other 90 percent. They added that, like the Clay County officials mentioned above, economic development officials often credit all new employment and growth to tax subsidies.

As Christmas approaches, Springfield residents could get no better Christmas gift than the elimination of state and local economic development agencies. They are a blight on capitalism and an actively harmful influence on the civic and economic life of our state.

The post Springfield Should Eliminate Its Economic Development Agencies appeared first on Show-Me Institute.

In government, nothing succeeds like failure. How else to explain Springfield’s attempt to imitate St. Louis and Kansas City with the creation of a city land bank despite the clear evidence of failure of the existing lands banks in both of those cities.

Land banks are local agencies empowered to acquire vacant, derelict, or tax-delinquent properties with the goal of returning them to productive use in the private sector. Land banks are authorized to be more proactive in acquiring property than traditional county land trusts. The goal of land banks may be laudable. Their record of performance is much less so.

Missouri created the nation’s first land bank in St. Louis in 1971 to help get control of vacant properties and return them to private use. Since that time, the St. Louis land bank has proven better at acquiring properties than at returning them to the private sector. In a struggling city like St. Louis, that isn’t surprising. More troubling is that the reluctance to get rid of the properties it owns has been no accident. Research by Show-Me Institute staff and others has documented the alarming frequency with which legitimate offers for property in the land bank have been rejected. Most commonly, the land bank has been rejecting offers in order to hold the land for future—often more politically connected—development. That development has seldom come to fruition, so thousands of land bank parcels have sat unused for decades.

In 2012, Kansas City followed St. Louis with its own land bank. At the time, the Show-Me Institute published research documenting the failures of the St. Louis land bank as a warning to Kansas City. Disregarding the history and evidence, the state approved a Kansas City land bank, which was started up that year.

Fast forward to 2022, and the Kansas City Star has recently published a major investigative article on problems at the Kansas City land bank. Needless to say, the Kansas City land bank has not lived up to its promises. Its executive director was removed in 2018 after accusations of political favoritism and other problems. The family of the Jackson County Executive received a special deal on certain properties, which raised plenty of eyebrows. As in St. Louis, the Kansas City land bank has been plagued by conflicts of interest and poor management.

The final Missouri city to institute a land bank in Missouri is St. Joseph, in 2019. Thus far the land bank has proceeded laboriously. After two years, it owns just five properties. It may be too early to make a final judgment, but based on its slow start and the lack of success in other cities I’d say the prognosis for the St. Joseph land bank is poor.

Land banks have fundamental problems. Ideally, they would work quickly and efficiently to place properties they own back into private hands. But that very speed is what can make them subject to abuse by those with political connections. In order to guard against such problems, they can become a typical bureaucracy—slow and difficult to deal with. But in that case, few in the private sector will want to work with them. So, the choices are to operate quickly and accept some level of malfeasance, or to operate bureaucratically and drive away your own potential customers. Finally, land bank employees have little incentive to do their jobs so well that they find themselves out of one.

Supporters may claim that Springfield would operate its land bank more effectively than St. Louis, Kansas City or St. Joseph. I don’t dispute the sincerity of the promises—just the likelihood that they’ll be kept.

Springfield needs a new city land bank about as much as it needs the return of bushwackers and bald-knobbers. The city would be better off not creating a land bank and letting Greene County dispose of tax-delinquent properties in its longstanding manner. If Springfield does create a land bank, I fully expect to read a News-Leader investigative report of its failures in the next few years.

The post Springfield Does Not Need a Land Bank appeared first on Show-Me Institute.

It is important to learn from one’s mistakes, and when it comes to special taxing districts in the Springfield area, there are plenty of mistakes to learn from. Special taxing districts (SDs) are tax districts established to support one specific function or program, such as a school district. In recent years, however, most new SDs have been nothing more than vehicles for corporate welfare, and their use in Springfield has been anything but an example of good government.

Springfield is now considering a gift basket of new tax subsidies for the Sports Town youth sports complex. This included the recent city council approval of a new community improvement district (CID) to use tax dollars to subsidize the private development. First, the city gerrymandered a map to make sure the new CID didn’t include any voters to get around the voting requirements. Next, city leaders decided to give the developers $2 million in upfront subsidies even though the city’s own guidelines recommend against doing exactly that. The upfront subsidy by the city means that all Springfield taxpayers are paying for this project, not just the ones who may use the facility.

Remaining on this expensive list is a request by the developers for $4 million more subsidies from federal stimulus funds. Shockingly, the developers have decided that their project qualifies for federal funding. Maybe it’s for the sewers, or for tourism, or perhaps this project will help fight the COVID pandemic. Youth sports may be infrastructure now. Whatever the feeble excuse is, the lure of “free” federal money is strong. If a private development such as SGF Sports (the company behind Sports Town) cannot succeed without multiple subsidy programs, it’s not the job of taxpayers to ensure it goes forward.

With such a large subsidy upfront, Springfield is basically trying to be a real estate developer. The city should have learned from Greene County that government real estate speculation is a bad idea. That county previously subsidized the private Jamestown development by creating a neighborhood improvement district (NID) to pay off bonds the county issued in support of the proposal. It assumed the future taxes from the NID would suffice to pay off the bonds. It assumed wrong. When the Jamestown project failed, Greene County taxpayers were on the hook for the unpaid debt. Springfield should have learned from this costly mistake.

This SGF Sports CID would be the 17th CID in Greene County, most of them in Springfield, along with at least four more transportation development districts (TDDs). Despite the public-sounding names, many CIDs and TDDs consist of just a few parcels of property with sales taxes imposed on the public for the private benefit of one property owner. These tax dollars are often used for essentially private purposes, such as retail parking lots or landscaping.

How have these other SDs worked out in Springfield? Not very well. Missouri state auditor Nicole Galloway specifically cited Springfield’s HyVee store CID for improperly collecting almost a quarter million dollars of tax money. Galloway also identified Springfield’s College Station TDD downtown for multiple abuses, including failures to notify shoppers of the tax. Based on research on SDs generally in Missouri, the other SDs are likely functioning as corporate welfare schemes here in the Queen City of the Ozarks.

Springfield is a vibrant, growing community that does not need to rely on tax subsidies to boost its economy. If Springfield wants to help all businesses succeed rather than just a select few, it should work with Greene County to lower its commercial property tax surcharge rate, which is high compared to those of other Missouri communities. The CID for Sports Town was not necessary, and $4 million more from federal funds would be an even worse decision. The evidence is clear that these subsidy programs produce more financial mismanagement than economic growth. Springfield should learn from its history and stop repeating the same mistakes.

The post Springfield Should Reject Subsidies for Sports Town appeared first on Show-Me Institute.

Mr. Pratt is plainly wrong on both counts.

As the Kansas City Public School District has admitted and as we’ve demonstrated repeatedly over the last few months, critical race theory (CRT) and its associated concepts are appearing in curricula and teacher trainings across the state. The Columbia Public School District can misrepresent what it is teaching all it wants. The Springfield and St. Louis Public School Districts can hide what they’re teaching all they want. But we know these materials are showing up in classrooms across the state—in both big districts and small districts—and in diversity, equity and inclusion training materials with many teachers.

It is bizarre that a Missouri State diversity official would assert that CRT is “not being taught in the public schools, it’s not even being trained in the public schools.” Like I would for anyone interested in exploring CRT issues, I would be happy to sit down with Mr. Pratt so he can see the sorts of materials we’re finding. It may not be helpful to the audience he told otherwise, but finding out the facts late is better than never.

The post Yes, Mr. Pratt, Critical Race Theory is Being Taught and Trained in Missouri K-12 appeared first on Show-Me Institute.

Longtime United States Senator and Chairman of the Senate Finance Committee Russell Long of Louisiana used to say, “Don’t tax you, don’t tax me, tax that man behind the tree.” Long knew that everyone’s favorite tax was the tax that forced someone else to pay for something. We all want services from the government. The problem there (actually, there are many problems there, but let’s focus on the tax issue) is that we have to pay for those services with taxes. Like many other politicians, Long realized that what we really want is to have other people, the “outsiders,” pay for our public services.

Local governments in Missouri have excelled at this practice for many years. It was here in Missouri that local governments took it to its most extreme form in Mack’s Creek, St. George, and many other places by funding their city governments with reprehensible fine and ticketing practices. Ferguson got much of the attention for these actions after the riots, but, in fact, they were a fairly normal Missouri city when it came to using fines and tickets to fund their city’s operations. After the violence in Ferguson, the state passed beneficial legislation that finally limited this practice, and our entire state is better off for that change.

But local governments still focus on raising revenues by taxing outsiders. Voters in Kansas City and St. Louis just approved keeping the earnings tax, which includes taxing people who don’t live in those cities and can’t vote on the issue. Who wouldn’t want to tax someone else who is only in the city for limited periods, uses fewer public services, and has no say in the matter? Branson did the exact same thing earlier this month when voters passed proposals to pay for important infrastructure improvements entirely with new hotel and restaurant sales taxes.

Welcome, stranger, thanks for visiting.

A more common practice is the use of special taxing districts such as transportation development districts (TDDs) and community improvement districts (CIDs) to fund local services. Such districts have exploded in recent years, going from a combined 86 in 2004 to 732 in 2020. Special taxing districts can use property taxes, sales taxes, or direct user fees like tolls for their projects. While a couple of the most well-regarded of these tax districts do use property taxes or tolls to fund their operations, I’ll let you guess which tax most of them use. That’s right, the sales tax.

In a 2017 audit, Missouri state auditor Nicole Galloway cited numerous TDDs and CIDs for financial and management abuses. In Springfield, she detailed how the College Station TDD failed to notify shoppers of the tax and failed to include area residents on the TDD board. In Waldo (in Kansas City) multiple CIDs are layered on top of each other, creating high taxes for shoppers that benefit business owners, not the general public. In Southeast Missouri, the Black Mountain CID in Van Buren was caught using the CID’s tax money to make private loans, pay private debts, and fund private expenditures. In Mid-Missouri, the Stoneridge TDD in Jefferson City granted a no-bid contract submitted after the supposed deadline to a board member’s company, while the Rock Bridge TDD in Columbia collected sales taxes from businesses outside the district. Missouri needs tighter limitations on the use of TDDs and CIDs, or they will continue to be abused around the state.

There are benefits to funding government with consumption taxes. This is not an anti-sales tax piece, generally speaking. What I want to argue against is the exploitation of the idea that those shoppers, workers, or visitors who briefly appear in your city need to pay their “fair share” of the local tax burden. “Free rider” is a term for people who use public services without paying the costs. Good public policy should work to limit free riding where possible. But is a person who shops in your city really a free rider who must, in the interest of fairness, pay another half-cent sales tax on the goods that they buy? I don’t think they are, even in tourist havens like Branson or Lake of the Ozarks.

Those shoppers are already paying gas taxes, and a portion of the gas tax gets sent straight to cities for their local roads. Beyond the gas taxes, shoppers and other visitors will generally travel major state and county roads to get to their local shopping destinations. Those malls, shopping centers, grocery stores, etc., are rarely located on streets maintained by city governments.

Those businesses that employees work for or shoppers patronize are already paying commercial property taxes (which are assessed at higher rates than homes) to the city. They pay business license fees to the city, so I might ask what the purpose of a business license is if not to allow employees and customers to come to your place of business? Arguments for raising new taxes, including through measures like TDDs and CIDs, frequently leave out any discussion of all of the other taxes and fees that are currently being paid.

Another issue with funding as much of your local government as you can with a sales tax directed at outsiders is that doing so makes things the government wants look like things the government needs. Do you think that Missouri’s nascent and inexplicable enthusiasm for new trolleys and streetcars would be happening if property owners and trolley users (the few there are) were paying the entire cost? Of course not. The Loop Trolley is entirely funded by outsiders via local sales taxes and federal tax dollars. The Kansas City Streetcar is significantly funded by federal tax dollars and a local TDD, although—to give credit where due—some of the operating funds come from local property taxes. The ability to export most or all of the cost of a new government project onto people who don’t vote on it makes it much more likely that government will engage in activities with questionable benefits. Using property taxes instead as the primary basis for local government funding results in better decision-making by voters—who must decide if the benefits of the government activity are worth what the voters themselves will have to pay for them.

The local leaders who push these efforts to tax outsiders or alleged free riders often feel they are being clever by doing so, as if they have discovered some new trick. The recent ads in favor of the earnings tax in Kansas City proudly claim that half of the money comes from people who don’t live in Kansas City. Supporters of almost every new TDD, CID, or other sales tax proposal consistently tout how this will make those outside shoppers finally pay their fair share. What is lost here is the fact that while your city is being clever in getting that revenue from those outsiders, all of the other cities are doing the same thing to your residents. This whole endless endeavor just creates a circular firing squad of higher taxes used to fund government expenses of questionable necessity. At its worst, it led to long lines at night courts throughout Missouri as town after town was funding itself with tickets and fines targeted toward making payroll rather than public safety.

If Russell Long had been from Missouri, he probably would have changed the final line of his doggerel. “Tax that tourist in the CID” and “Tax that driver in the SUV” come quickly to mind as localized final verses. But his main point stands the test of time and geography. Long understood the desire to tax someone else to fund your public services; a desire that is alive and well in Missouri. Who knows, perhaps Senator Long once got a speeding ticket in Mack’s Creek?

The post Here’s A Crazy Idea: Tax Yourself. appeared first on Show-Me Institute.

On May 13, David Stokes joined The Gary Nolan Show to discuss a gas tax increase that is headed to the Governor’s desk and a trend in Missouri local government – taxing outsiders.

Read David’s piece in the Springfield News-Leader and the Columbia Daily Tribune

Listen to more of The Gary Nolan Show

The post The latest on a Gas Tax Increase and are Tourists “Free Riders”? appeared first on Show-Me Institute.

Last month, former Missouri legislator Dr. Roy Holand wrote a letter to the editor of the Springfield News-Leader warning about trends—including both an increase in student poverty and declining test scores—that have the Springfield School District headed in the wrong direction. Could Springfield end up like Kansas City or St. Louis and, as Dr. Holand warns, suffer from “local urban flight” to surrounding districts? Moreover, will students from low-income families be stuck in poor-performing schools because they cannot afford to move to another district or attend a private school?

Based on data from the Department of Elementary and Secondary Education (DESE), Springfield’s enrollment is remaining steady around 25,000, but it is not faring as well as neighboring districts. Take a look at nearby districts’ performance as measured by the 8th grade MAP tests and student population characteristics compared to Springfield:

Compared to surrounding districts, Springfield has a similar achievement level in eighth grade English, but scores much lower in math. Moreover, Springfield is close to the statewide average of 60.2 percent of eighth graders scoring proficient or better in English, but it is far behind the statewide score of 30.5 percent of eighth graders scoring proficient or advanced in math.

Given these scores, it is not surprising that six out of nine middle schools in the district scored less than 70 percent on the 2017 Annual Performance Review (APR), which is the state’s threshold for full accreditation.

Additionally, legislation has been introduced that would allow for charter schools to open in any district that has at least one school that earned 60 percent or fewer of the possible points on the APR in two of the last three years. Four elementary schools and three middle schools in Springfield currently meet those criteria. If this legislation passes, Springfield will join St. Louis and Kansas City as “charter schools as intervention” districts.

While Springfield is technically still accredited under the Missouri School Improvement Program (MSIP) system, the number of struggling schools in the district is cause for concern. Because some of the 2017 MAP tests were thrown out, 2016 is the most recent year that all school received an APR score; as you can see, the schools’ performance varies significantly:

Considering this range in performance, can a parent in Springfield be confident that their child will be able to attend a quality school? While Springfield does have some choice programs, such as the option to enroll in schools emphasizing STEM subjects and an intra-district transfer option, the seats for these programs—and in the good middle schools—are limited. With so few quality options for middle school, and with the elementary schools being a mixed bag, it would not be surprising if families started leaving for the surrounding districts or sending their kids to private schools.

Holand is not the only one worried about the direction of the district. As the school board considered renewing Superintendent John Jungmann’s contract, former Springfield teacher Carl Herd also argued that district’s performance is “not acceptable” and it will hurt the economic health of the city. Nonetheless, the school board voted unanimously to extend Jungmann’s contract through 2021.

Kansas City’s and St. Louis’s experiences serve as a cautionary tale. Fortunately, families in these cities have charter schools as an option. And while these districts’ enrollment continues to decline, charter school enrollment grew by 11 percent last year. If Springfield’s performance continues to slip—and there is growing evidence that it this is happening—the families who cannot afford private school or are unable to move to another district will suffer.

The needs of the students and parents in the Springfield should be the top priority of the school district. Expanding school choice programs, such as charter schools or education savings accounts, which are popular with parents, would ensure that these students have more quality options.

The post Will Springfield School District Become the Next Kansas City or St. Louis? appeared first on Show-Me Institute.

The St. Louis Post Dispatch reports “Missouri mulling pension payouts for some former state workers.” Meanwhile, the Springfield News-Leader writes “Troubled Missouri pension system offers buyouts to former state employees.” In the PD piece, State Treasurer Eric Schmitt, who is also on the MOSERS board of directors, is quoted as saying, “Now is the time to start taking our pension troubles seriously. If we don’t, it will mean less resources for our schools, roads, and health services down the line.”

The buyout for MOSERS employees would provide a lump sum payment, rather than collect pension benefits down the road. The buyout is worth less than the actuarially assumed pension benefits the workers would stand to receive; thus it would generate a savings for MOSERS and it could potentially help some workers.

The treasurer is right. We cannot keep kicking pension problems down the road and this buyout is a smart, common sense strategy for reducing pension obligations. Smart, that is, for the state. Whether it is smart for the workers to take it is another story. Andrew Biggs doesn’t think so. Check out this Twitter interaction between, Biggs, Mizzou economics professor Cory Koedel, and me. 

Biggs suggests MOSERS pensioners shouldn’t take the deal. Koedel and I offer responses in jest, as Missouri taxpayers we stand to benefit from MOSERS shoring up its bottom line. Then Biggs offers a startling calculation. He suggests the buyout is worth approximately 39% of the value of the worker’s benefits. I doubt that’s actually worse than the odds on a lottery ticket, but it is certainly not a good payout.

Does this mean no one should take the buyout? Not necessarily. There may be circumstances in which some workers might be interested in having a lump sum of money rather than a pension that pays out over a course of 30 plus years. For instance, if you don’t expect to live that long!

The most important thing here is for workers to be educated on this option. With that said, I commend the MOSERS board for exploring this option and encourage MOSERS workers to fully understand their options before making any decisions. 

The post MOSERS Pension Buyout Good for Taxpayers, Probably Not for All Workers appeared first on Show-Me Institute.

Teacher compensation is an important policy discussion. Yet, too often the mere suggestion of change is met with hostility by teachers. As a former teacher myself, I understand that there is safety in salary schedules along with uncertainty about what they might be replaced with. Indeed, one retired teacher took to the newspaper’s pages to make this point. Although she didn’t argue specifically for salary schedules, it was clear that she was averse to change. But many people are examining how we pay teachers, and they often reach the same conclusion I reached—we need to change how we do business. But what should that change look like?

On July 27, a National Public Radio station in Michigan ran a story called, “Are we thinking about teacher pay all wrong?” The piece described Washington, D.C.’s merit-based pay system. As the piece notes, “There are two parts to the D.C. pay system: an annual bonus of up to $25,000 after one year of being rated ‘highly effective,’ and an increase in base salary of up to $27,000 for teachers who are rated ‘highly effective’ two or more years in a row.” Rigorous evaluation has shown that D.C.’s system, which is a combination of pay reform and a new teacher evaluation process, has improved the teacher workforce and led to an increase in student achievement.

There is of course still debate as to whether the D.C. model could be effectively implemented in other cities, let alone in rural parts of Missouri. Nevertheless, Missouri students and teachers would benefit from a critical examination of our teacher pay policies.

Unfortunately, too many teachers (like the one who wrote a response to me) and their union representatives seem unwilling to have a serious discussion on this important matter. One teacher in the NPR story suggested that we “need to offer starting teachers an apprentice pay for 5 years at $55,000. If they are effective after 5 years, bump them up to $75,000. If they are highly effective pay them $100,000.” Such a structure simply is not economically feasible. The response from David Hecker, of the American Federation of Teachers of Michigan, was equally unsatisfying. He first suggested that “starting pay should be comparable to other professions,” but went on to ask, “Should the senior teacher get more for experience, or the younger teacher who needs to make a decent living so they can be attracted to and stay in the field? That should never be the trade off.” His answer displays a fundamental lack of economic understanding. Of course there is a trade-off! There is always a trade-off.

We should not continue to pay teachers solely based on years of experience and extra degrees, especially when those things are not closely related to student outcomes. But in any case, if we are going to have a fruitful conversation, teachers need to come to the table with thoughtful suggestions. Maybe then we could create a system that truly fosters excellence and rewards teachers for the hard work they do.

The post Reconsidering Teacher Pay appeared first on Show-Me Institute.

Teachers are paid on what is known as a salary schedule, which maps out exactly how much a teacher will make for their entire career based on how many years of experience they have, with additional adjustments made for teachers with advanced degrees. When finances are tight, however, district officials will often do one of two things: sometimes they decline to adjust the schedule for inflation, and in leaner years they may “freeze” teachers at their current salaries. According to the Springfield News-Leader, salaries for Marshfield teachers were frozen for four years, and teachers received just a one percent raise in two other years.

Some teachers feel a sense of entitlement regarding pay raises. As a former public school teacher, I know this from experience. You would feel entitled to a raise too if your employer presented you with a predetermined salary structure. You consider yourself bound by the salary schedule, but you consider the district bound by it as well. What good is an agreement that only one side must abide by?

Over the years, I have analyzed hundreds of salary schedules. While conducting my research, I found one school district that did not have a salary schedule. When I spoke with an administrator there, I asked him why not. He said the schedule was like a promise to teachers. They expected to receive those raises. When they did not, they felt that something had been taken away from them. It felt like a slap in the face.

When workers in any field believe they are not valued, morale drops, productivity may decrease, and employees might look for jobs elsewhere. We certainly don’t want low morale among our teachers.

In Marshfield, with the foundation formula fully funded for the first time since its inception, the district will largely make up the “missed” pay increases. This will help ameliorate any negative sentiments from the years when their salaries were frozen. It will, however, do little to change expectations among teachers.

Currently, salary schedules dominate school district budgets. They tell the financial office how much money is available to hire new teachers or to purchase new resources. The National Center for Education Statistics reports that approximately 80 percent of a district’s operating expenses go toward salaries and benefits. With salary schedules, school boards and administrators cannot control these expenses without “taking away” raises from teachers. That is a problem.

The school district without a salary schedule has a different model, one in line with sound financial management. It gives raises based on how much money is left in the budget, which helps school officials effectively manage their budget.

The post Want to Value Teachers? Eliminate Salary Schedules appeared first on Show-Me Institute.