If passed, HB 2872 would have created a mandatory third-grade retention policy for students who could not read effectively and established an enforcement mechanism to align Missouri’s teacher preparation programs with the science of reading.

One of the reasons cited by opponents of the bill was that we needed to wait and let Missouri’s 2022 early literacy reforms take “full effect.” The earlier legislation had some positive aspects, but HB 2872 would have filled important gaps that are clearly seen in a new 2026 report from the National Council on Teacher Quality (NCTQ).

The NCTQ report evaluates colleges and universities across the United States on how effectively their curriculum addresses the five core components of the science of reading: phonemic awareness, phonics, fluency, vocabulary, and comprehension. It also considers whether programs teach practices found to be ineffective, such as the three-cueing method.

Among the 50 states, Missouri ranks 44th in addressing the core components of the science of reading, with an average of just 2.3 out of 5.0 components. Half of all states scored 4.0 or higher, while often-praised Mississippi scored 4.7.

Even more alarming, Missouri ranks 2nd in the nation, behind only Maine, in teaching ineffective reading practices. Our participating programs taught almost four times more ineffective practices, on average, than the national average.

These results suggest Missouri cannot afford to simply wait for our prior literacy reforms to “take effect.” Today’s students in Missouri’s teacher preparation programs are the teachers of tomorrow’s children, and many are not learning how to teach reading correctly.

Nearly half of the universities in Missouri evaluated by NCTQ received an “F” in teaching the science of reading, including Northwest Missouri State University, Truman State University, and Missouri Southern State University. By comparison, 73% of Mississippi’s programs received an A and none earned an F.

It’s also concerning that 52 percent of Missouri’s programs either refused to participate, provided heavily redacted materials, or were otherwise unresponsive to the survey. These institutions partner with the state to prepare future teachers, and there should be transparency about how they train teachers.

The success stories of early literacy reforms are well known. Mississippi, Louisiana, Tennessee, and Indiana have posted meaningful gains in reading achievement after implementing reforms, while Missouri continues to slide in national rankings. We fell from 27th to 38th in fourth-grade reading on the National Assessment of Educational Progress between 2013 and 2024.

In 2023, Indiana required teacher preparation programs to be aligned with the science of reading and prohibited the use of the three-cueing method. Any unaligned program loses the right to be called “accredited.” In a previous NCTQ report from 2023 based on data from before Indiana implemented reforms, 33 percent of Indiana’s programs received an A+ or an A. In 2026, 96 percent received an A+ or A.

The reforms in HB 2872 were modeled on Indiana’s policy and would have helped ensure that future Missouri teachers are trained in the science of reading. Early literacy reform would have built on past successes and helped more students become confident, capable readers. All we can do now is try again next year.

The post Missouri Missed an Opportunity on Reading Reform appeared first on Show-Me Institute.

The upcoming release of the movie Supergirl got me thinking about another Superman-related film—one without laser vision or chiseled jawlines.

Waiting for Superman, released in 2010, follows families hoping to use lottery systems to get into a charter school. These families were stuck in failing public schools and desperate for a way out. Parents profiled in the film cried tears of joy when their children “won” the lottery and were so disheartened when they didn’t.

Its message was simple: droves of students are stuck in failing public schools and are waiting desperately for someone to help.

Missouri has been content allowing students to wait for Superman (or Supergirl now). My colleague, Susan Pendergrass, describes the problem well:

For years, the education establishment in Missouri has relied on a predictable playbook. Whenever state test scores drop or national rankings look bleak, we are told that the data don’t capture the whole picture, or that a new bureaucratic report card will soon show things are turning around. We are urged to wait, to invest more taxpayer money, and to trust the system.

But each year, more students move through the system either underprepared or unprepared. Thankfully, there are proven policies that can help.

Charter schools, open enrollment, and education savings accounts (ESAs) give parents choice, which in turn fosters more competition. With increased competition and accountability, schools are incentivized to innovate.

But Missouri parents have significant limits on choice.

Charter schools face a quasi-ban across the entire state, except in the St. Louis City School District, the Kansas City 33 School District, and all school districts in Boone County. (A charter school does operate in Normandy Schools Collaborative due to an accreditation provision). Missouri does not have open enrollment, and the ESA program reaches only a fraction of the state’s more than 900,000 students.

This needs to change.

Also concerning is Missouri’s reluctance to embrace comprehensive early literacy reform.

When Waiting for Superman was released in 2010, Mississippi ranked 48th in fourth-grade reading on the National Assessment of Educational Progress (NAEP). Louisiana ranked 47th, Tennessee ranked 38th, Indiana ranked 27th, and Missouri ranked 31st.

Since then, Mississippi, Louisiana, Tennessee, and Indiana have implemented serious early literacy reform. They all recognized teaching children to read is a serious undertaking that requires serious solutions.

Success has followed. By 2024, Mississippi had risen from 48th to 9th in fourth-grade reading. Louisiana climbed from 47th to 15th. Tennessee improved from 38th to 23rd. Indiana jumped from 27th to 6th. Do those states have more work to do? Of course.

But while they’ve shown improvement, Missouri has fallen from 31st to 38th, as 42% of our fourth graders scored below basic on the reading portion of NAEP.

There was a clear opportunity to pass early literacy reform to mimic the successes of these other states with House Bill 2872. But opponents in the Senate argued that Missouri should allow the state’s 2022 early literacy reforms (Senate Bills 681 and 682) to take full effect. In other words, keep waiting.

Superman does not exist, and neither does Supergirl.

But policymakers do.

Missouri students cannot afford to spend another year waiting. There are proven reforms that can expand educational opportunity and improve outcomes. This year, Missouri chose not to pursue them. For the sake of our students, that needs to change next year.

The post Waiting for Supergirl appeared first on Show-Me Institute.

Avery Frank, Elias Tsapelas, and David Stokes join Zach Lawhorn to break down the final week of the 2026 Missouri legislative session. They discuss the constitutional amendment heading to voters that would begin the process of eliminating Missouri’s state income tax, where property tax reform efforts stand heading into the final days, the early literacy bill’s uncertain path through the Senate, the legislature’s approach to A through F school report cards, what the state budget does and does not get right, the Ferguson city council’s rejection of a major data center tax subsidy, and more.

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Episode Transcript

Zach Lawhorn (00:00): Welcome to the Show-Me Institute podcast. I’m Zach Lawhorn from Show-Me Opportunity. Today I’m joined by Avery Frank, Elias Tsapelas, and David Stokes from the Show-Me Institute. It is the last week of the 2026 Missouri legislative session. Today we’re going to go through what has crossed the finish line, mostly what has not crossed the finish line, and see what these guys think about the possibility of that happening here in the home stretch. Elias, we’ll begin with something that has crossed the finish line, and that is the start of a discussion about phasing out Missouri’s state income tax. Legislation did pass. It goes to the governor, and he gets to decide when it goes on the ballot. So what do we know right now, what passed, and what are Missouri voters going to be asked sometime in the fall?

Elias Tsapelas (00:50): By May 22nd, the governor needs to decide whether this constitutional amendment will go on the August or November ballot. What it says, essentially, is to Missouri voters: do you want to start the process of getting rid of Missouri’s income tax? It comes with three main components. The first piece is the legislature will be required to enact legislation that would get rid of the state’s income tax based on revenue growth. Once that income tax is gone, it cannot be reinstituted. Previous versions of this bill had some details lined out about how the income tax rate would be cut based on revenue growth, but in later versions this was stripped back to just the legislature will decide this later. The other two pieces say you will also be authorizing the legislature to expand the state sales tax base, meaning the things the state sales tax applies to. This could also involve changing the rate, because right now Missouri’s constitution does not allow the state legislature to expand the sales tax to anything that was not taxed in 2015. But this does come with a guardrail: if the legislature does change the state sales tax, it has to be done in a revenue neutral fashion. So expanding the sales tax base or raising the rate to bring in additional tax revenues has to go towards lowering the state income tax. That gives the legislature the authority to change how much revenue comes in, which would speed up the process for getting rid of the income tax. The last piece is a component for local governments. If the state changes the number of things that the sales tax applies to, this would also increase revenues to local governments. Those additional revenues would have to go towards a list of other taxes that would be lowered. In places like St. Louis and Kansas City, that would go towards lowering the earnings tax. For other local governments, they get to choose whether it goes towards lowering the sales tax, property tax, personal property taxes, or real property taxes. The key piece being revenue neutral. This is not going to be a windfall for anyone. It is basically the start of a discussion, because they don’t say what the rate might need to go to, what the sales tax could be expanded to, or what revenues would trigger income tax elimination or cuts. This is just the start of the discussion, giving the legislature the authority to keep moving in the direction we started around 2014.

Zach Lawhorn (03:57): Taking those a piece at a time: the first one, if it passes and the income tax is eliminated at some point, it cannot come back. That seems pretty straightforward. The next two seem like responses to opposition that we hear on a regular basis. The first being the revenue triggers, which seem designed to prevent what we often hear about with Kansas, where they cut the income tax without cutting spending, leading to revenue shortfalls. And the expansion of the sales tax base seems like protection against having to raise the sales tax rate on goods. Do I have that right?

Elias Tsapelas (04:40): Yes. The revenue trigger piece is basically what Missouri has been doing for a while, waiting to see how much revenue we have before lowering the income tax by that amount. We’ve been doing that for over a decade now and have lowered the top individual income tax rate from 6% to 4.7%. We’re just continuing down that path to be sure we don’t create some enormous budget hole. Now, when you look at the sales tax, Missouri has a very complicated, out-of-date sales tax system. The state sales tax rate is 4.225%, but when you go to the store you’re paying something significantly higher, largely due to local governments and a lot of special taxing districts. Missouri also has a lot of sales tax exemptions. Missouri really needs a full look at its entire sales tax system. But economically, when thinking about switching a state from being primarily funded by income taxes to something closer to sales taxes, the best way to fund a state is to tax as broad a base as possible so you can have the lowest rate possible. You want to be taxing final consumption, not business inputs. As we start the idea of transferring to more of a consumption tax in Missouri, the goal is to make sure it doesn’t become a tax increase for some people while things change elsewhere. It’s trying to keep it level the whole way, and at least right now it seems like a pretty neutral proposal going forward.

Zach Lawhorn (06:24): David, for people who don’t think about taxes as a corresponding tax system, can you explain the idea of local governments rolling back certain taxes and how people might experience that on their property tax bills or personal property tax bills?

David Stokes (06:44): It’s trickier than you might think, but it’s vital that it be done right. If you expand the sales tax base at the state level, as Elias discussed, you don’t want local governments to start collecting significantly more sales tax revenue for no reason. At the state level we’ll do something good with that and phase out the income tax, but at the local government level we don’t want just more revenue with nothing to spend it on. You need tax relief for citizens, which is why they’re going to require rollbacks. They’ve given local governments some options in how you roll that rate back, which is a good thing, but they need to give them a few more options. For example, they said you could roll back property taxes, real property taxes, personal property taxes, or sales taxes. A few things that need to be considered: many municipalities don’t have a property tax, so they won’t be able to roll back the property tax. And it’s trickier to roll back sales taxes than you might think. Unlike property taxes and income taxes, which can be reduced in small increments, sales taxes have to be done in set increments. You can’t go from a 1% sales tax to a 0.92% sales tax. It’s just not allowed and would be incredibly difficult for retailers to implement. So local governments need even more flexibility in how they roll back taxes. I would say the utility tax, which just about every county imposes, is a great option to add to the choice mix for rollbacks. These are the sales taxes that can be placed on utilities, which unlike other sales taxes can be rolled back in small increments. That’s a very good option. The biggest challenge of all, though, is the special taxing districts that Elias mentioned earlier, such as transportation development districts and community improvement districts. These usually only have sales taxes and nothing else. You have to address what they do if their sales tax collections go up 30% and they have no legal way to roll it back by that same amount. So we need to adjust that. I would also hope that part of this whole deal would be a substantial cap on how these special taxing districts like TDDs and CIDs operate in the first place, to really restrict their continued expansion in Missouri, which has been very harmful. Those are just a few ideas out of many in how local governments are going to have to address this.

Zach Lawhorn (09:59): Finally, Elias, as you said, it’ll be on the ballot sometime in the fall. But between now and either August or November, people interested in this topic are going to see a lot of data, modeling, estimates, and projections. We want to be honest about what we can know and what we cannot know. With the legislation that has passed now, what should people keep in mind when they see some of these estimates or models or projections this summer?

Elias Tsapelas (10:39): The first thing is, if you see anything claiming this is going to generate a tremendous budget shortfall or major harm to local governments, this thing is set up to be revenue neutral. This is not something that is going to create enormous holes. Most of the time, estimates that reach that conclusion assume this would work in an entirely different way than what is allowed. So that is something you don’t necessarily need to worry about. What people are more reasonably worried about is: if you empower the legislature to expand or raise the sales tax, how is that going to impact everyone? Missouri’s state and local combined sales tax rates are relatively high already. The state’s portion is pretty low, but combined it’s relatively high. So what the state decides to do in terms of how much it expands the sales tax base, whether that involves more services versus goods, will impact different people differently, in different parts of the state and at different income levels. Anything right now that says this is definitely going to be bad for X person, we just can’t know that, because there’s not enough information out there. Everyone should keep an open mind and also recognize that the reason for this amendment and this proposal is that Missouri’s economy is falling behind. We are falling behind our neighbors in terms of tax competitiveness, and the only way to change that is to improve Missouri’s tax standing. Our sales tax system is incredibly broken, so this is something that is going to need to be fixed. At least right now we are at the point of asking: do we want to go down this path? Let’s hope the legislature does a good job. We’ll be shining a light on whatever they do, but we can’t know some of the things that people are warning about right now.

Zach Lawhorn (12:50): David, after the legislature got the income tax bills out the door, they shifted to talking about property taxes, which is something we hear a lot about. People want property tax reform. With only a few days left in the session, where do those efforts stand and what are your thoughts?

David Stokes (13:11): Unlike a lot of the property tax changes of the past few years, I actually like the property tax changes being proposed this year. At least one property tax bill is in conference committee being debated between the House and Senate right now. Another major bill has passed out of the Senate but hasn’t made it through the House yet. I’m told there are going to have to be some compromises on both sides to get a bill across the finish line, and there’s nothing wrong with that. The biggest change this year, which seems very much in the weeds but is significant, would take the way property taxes are imposed in St. Louis County and apply it to the rest of the state. St. Louis County has different tax rates for all the different types of property: residential, agricultural, commercial, and personal property, which includes your car, boat, farm equipment, livestock, and the like. Those rates adjust differently as assessments go up and down each year. This approach was originally intended to be extended to the rest of the state about 20 years ago when they did it in St. Louis County, but the following year they came back and said the rest of the state didn’t have to do it. It’s a good idea. It might sound strange to some people, but a good example of why it would be beneficial came from stories in the St. Louis Business Journal about the real decline in commercial property values in the city of St. Louis over the past year. Because they set one tax rate measured under one unified property value, residential homeowners in St. Louis end up making up with their taxes for the decline in commercial property. In St. Louis County, with the siloed tax rates, if commercial property goes down, the commercial property tax rate will go up to offset that instead of passing it on to homeowners. In rural Missouri, which has so much agricultural property, this would allow agricultural property tax rates to increase to fund goods in rural areas without as dramatically impacting commercial and residential property. I think this is a good idea and I hope it passes. There are also some good amendments that would put taxpayer protections in place to avoid the temptation of local officials to target commercial property with these new different tax rates. It’s in the weeds, but I think these are good changes this year.

Zach Lawhorn (16:24): That sounds like the other side of the coin from what’s happened in Jackson County, where over the last few years people have been very upset that their assessments have gone up by more than 20% and residential homeowners have seen gigantic leaps in their property taxes. Is this kind of like having to turn one knob one way and another knob the other way?

David Stokes (16:55): Sort of. The tricky part is that the situation in Jackson County for the past 10 years has been so bad, it’s hard to compare it to other counties. It’s been uniquely horrible for the people of Jackson County. But it does start with one basic truth: 15 to 20 years ago, Jackson County was under-assessed. The assessor was ordered to increase the valuations because they were improperly low, and probably artificially and intentionally low. The right approach would have been to raise those assessed valuations to more accurate totals while lowering the rates at the same time to avoid crushing people with higher taxes. But Jackson County’s taxing entities have not really done that, starting with the Kansas City 33 school district, a very large school district in Kansas City, which is the only taxing body in Missouri exempt from rolling back rates as values increase. So you’ve seen these giant increases within that school district and they don’t even have to roll back rates. They just get to keep their same rates, as they have frequently over the past 10 years. So people are getting walloped. And then you throw in the fact that the Kansas City Assessor’s Office has done a terrible job managing the process year after year, not hitting deadlines for notifying people about changes and not properly running the appeals process. It’s just been a terrible system in Jackson County, and almost uniquely so.

Zach Lawhorn (18:30): All right. Before we have Elias read the budget line by line, Avery, I want to get an update on the education items here in the last week of the session. Early literacy, the reading bill, we’ve been talking about it all session long. How’s it looking?

Avery Frank (18:47): When it first passed out of the House before spring break, 131 to 10, I was genuinely excited. It wasn’t necessarily that it passed so early; it was that it passed with such little resistance and such bipartisan support on both sides of the aisle. Teaching our students how to read, giving every student the best chance to become a confident, capable reader, that seems like common sense and a goal that everyone wants to work toward to help our state improve and perhaps become the next Mississippi. It looked that way before spring break, but the Senate version of the early literacy bill got filibustered and set aside. The House bill has made it through the process and is on the informal calendar for third reading, so it could be taken up at any time. If it does pass the Senate, I anticipate it would easily pass the House again. But that is the problem with a lot of education legislation: can it pass the Senate? There have been different concerns about the early literacy bills. Some people are concerned that the MAP test, or the Missouri Assessment Program, which we use to test all of our students, is not a good measure and we shouldn’t be basing anything on it. Some are concerned with third-grade retention and whether it actually helps, looking at states like Mississippi and noting that while fourth-grade scores are great, eighth-grade scores have only improved a little. Those are the main pushbacks we’re seeing. I would still say this is something we really need to do. The early literacy bill is built on two different pillars. The first is a mandatory third-grade retention policy. Missouri already tests all K through third-grade students with a reading screener to see how they’re doing with reading. What this bill would do is set a passing score for those screeners. If students don’t meet that score, they would be retained in third grade, because reading is such a foundational skill. If you don’t know how to read, that’s something worth holding back for, to make sure students get it down before moving on for the rest of their educational career. Students would still have the opportunity to retake the screener, and there would be good-cause exemptions for students with disabilities, for students who have been held back previously, and for English language learners. The second main pillar is reforming our teacher preparation programs. In 2023, the National Council on Teacher Quality conducted a survey of all of our universities and teacher preparation programs and found that half of them received an F in teaching the science of reading, which is the best evidence-based way to teach students to read. The early literacy bill would align our teacher prep programs with those best practices. If they don’t do it, they can’t certify teachers. You can see how there could be pushback and reason why people would filibuster or not want it to come to the floor. That’s where it stands right now. I’m hoping people set aside their objections and recognize that this is a great first step to get Missouri back on track. Our reading scores have been really poor, especially after the pandemic. They continue to decrease and have not bounced back at all. They’re lower now than they were the first year after the pandemic, and we have to turn things around. These early literacy bills, I hope people see the common sense in them.

Zach Lawhorn (22:30): It’s not even the perfect being the enemy of the good. It’s just people being afraid to push back against the status quo. Missouri has fallen back in reading test scores, and other states, most notably Mississippi, have found ways to improve. I don’t think it’s helpful to frame this as some kind of radical moonshot. In the final days of the session, the urgency cannot be overstated. The other thing we’ve talked about a lot this session is A through F report cards, a transparency measure. Governor Kehoe issued an executive order before the session started. What’s the status of the legislature trying to adhere to the governor’s executive order?

Avery Frank (23:19): The legislature has tried to legislate its own way into how the executive order gets implemented, because DESE, the Department of Elementary and Secondary Education, could implement it in their own way. The legislature wants to determine how things are going to be scored instead of letting DESE make that decision. There’s been a lot of back and forth, and a lot of different interested parties. Not to get too in the weeds, but some districts really want academic achievement, their base score on the Missouri Assessment Program, to be weighed the most heavily because that would give them the highest score. Some want growth to be weighed the most heavily for the same reason. Some want basically no grades and a lot more qualitative information. There are a lot of different factors. The best vehicle for A through F report cards right now looks like Senate Bill 1351, which continues the long legacy of education omnibus bills used in recent years in Missouri. It combines the report card, limits on screen time for young students, and a couple of other things. I’m not sure if that’s going to make it past, to be honest. People are still concerned about whether the Missouri Assessment Program is something they want to base all of this on. Personally, I think the executive order is better than the legislation as it currently stands. They got rid of one aspect I liked as a researcher: in Governor Kehoe’s executive order, there was a penalty if districts didn’t report their data properly. In the current legislation, Senate Bill 1351, if districts don’t report sufficient data, it’s just written as an aside, basically saying they have to note on their report card that there is not sufficient data, and then they’re not included in the ranking as much. I don’t like that. It gives districts, especially poorly performing ones, an incentive not to report their data so they can have this qualifier on all of their report cards. I also don’t like it because, from all the education research I’ve been doing, we really do have a data reporting problem and we need to be a lot better about transparency. I hope we get some good report cards, because right now at the Show-Me Institute we do our best with the data we have, but we have to work with unsuppressed data, meaning we don’t have data that could potentially identify certain students. So there are some districts we have no data on because they’re so small. But DESE and the state have the best data possible. They could make a really good report card even better than we could, because they have better data than we do. That’s why I’m really hoping we get a good report card, because it would be very helpful for all the parents, legislators, and researchers across the state to see which districts are doing well and learn from them, and which ones are doing poorly and need more support.

Zach Lawhorn (26:42): Let’s talk about the budget. Elias, the legislature passed the budget a little early this year. They beat the deadline by a couple of days, right?

Elias Tsapelas (26:53): They finished early, which is a little bit different than the last few years.

Zach Lawhorn (26:56): Are we spending more or less money than last year?

Elias Tsapelas (27:01): Spending less, but I’m not throwing them a party. There’s just a lot less federal money going around. There was a lot of COVID money in recent years, and Missouri hasn’t spent all of it. The current budget this year is about $54 billion. What the legislature passed is a little bit less than $50 billion, depending on whether you count different construction items. But there was a lot of federal money in that total. At the end of the day, what we’re looking at is a budget that is still going to spend more general revenue, where our income and sales tax dollars go. It’s still going to spend more than we expect to bring in. So we’re still going to exhaust all of our surplus that we built up over those years. There were some positive things that happened this year, but ultimately part of how they got the budget done early was by spending just a little bit more, so they left some of the good on the table.

Zach Lawhorn (28:20): So we’re spending the surplus, as you’ve been warning about for several years, the federal money is drying up, and to circle back to the opening segment, I think part of the trust the legislature is going to have to build this summer is demonstrating we’re getting spending under control. You said you’re not throwing them a party. But is this reduction, whatever the reason, directionally good enough for the legislature to say they’re working on the spending side of things, or is it just not good enough?

Elias Tsapelas (29:00): I think I’ll know a lot more going into next year, because there were a lot better discussions this year, especially looking at spending incentives. As was mentioned, DESE is going to have a new funding formula, or at least the governor has a task force working on one. The way education is funded for K through 12 is going to change. There was also a big fight this year about how to fund higher education. What seemed to me like a common sense idea, essentially having the legislature fund colleges based on how many students are enrolled, turned out to be considered too radical and was pushed off for the future. But there’s talk of coming back with a performance funding measure going forward. There’s also some movement on changing how the state does its IT work. There are a lot of IT changes coming, including things affecting Medicaid and the Supplemental Nutrition Assistance Program. Missouri has a very bad track record with IT. Part of this budget moves some IT resources over to the Department of Social Services to support getting things going there, because most IT for the state of Missouri is currently consolidated in the Office of Administration. While that can seem efficient because every state department doesn’t need its own IT department, it also makes it a lot harder to hold people accountable. There has been a big issue recently with the state’s accounting software, where a contract is millions of dollars behind schedule and not working. The budget tries to get at that too, and it raises this major incentive question: are the people in charge of implementing new IT going to do their best at something that will ultimately try to eliminate their job? I think the legislature is finally starting to deal with that. Ultimately, if we go down the path of a more efficient government and a better tax system, that may mean fewer state employees, and that is something that hasn’t come up much but I think the legislature is finally starting to look at. Pushing toward better funding models, a better state workforce, all those type of things, is moving in the right direction as opposed to how it has been, where the budget just grows larger every year. They’re looking in the right direction. I would have liked to see more, but I think we’ll know a lot more in the next year, especially because the federal COVID funding will essentially be gone.

Zach Lawhorn (32:12): Our final topic, partly so we can put it in the title of the episode for clicks, but also because it seems like every week there’s a story from across the country or across the state about data centers and communities pushing back for a lot of reasons. The most recent one was Ferguson in the St. Louis area. David, can you catch us up on what was on the table for this data center in Ferguson and what happened?

David Stokes (32:40): The vote that the Ferguson city council took last week was strictly on a tax subsidy, I believe about $1.8 billion in tax abatements and various subsidies for the project. It was not a vote on approving the data center itself. This was a commercially zoned area, so it didn’t need any permission to put a data center there, and that’s a good thing. But the city nonetheless rejected the tax subsidy, which I thought was the right call. These data centers are very profitable and important, and I’m certainly not anti-data center. But the demand that they get enormous subsidies everywhere they seem to be going is improper. Festus was right to approve the data center operation there, but I think very much wrong to approve the enormous tax subsidy the city granted, which I believe was about a half a billion dollars. Avery can correct me if I’m wrong on that exact number. I like what Ferguson did, and I hope the data center moves into the old Emerson complex there nonetheless. We need data centers. Data centers produce so much tax revenue that they can generate their own tax cuts, and I don’t mean a special subsidy for the data center itself. I mean they go into a city or a small area, generate so much revenue, and you can cut taxes for everybody in that community, including the data center itself. I think that’s the road to follow, and hopefully that’s what we’ll have in Missouri. I also think we need to change the way data centers are taxed in an upcoming legislative session, taxing them a little more like utilities to reduce the incentive for one city or county to hand out a big subsidy and instead spread those tax benefits around a little more.

Zach Lawhorn (34:46): Avery, are you heartened by this rejection? Because as David said, we need the data centers, but we really want to avoid this new layer of corporate welfare that could pop up everywhere. So how do you feel about it?

Avery Frank (35:00): I’m actually very excited by the rejection in Ferguson. I’ve talked to a lot of people on both sides of the data center debate, those who have gone to the meetings and stayed up until 3 a.m. and protested, and those who want them. When I look at this Ferguson project specifically, the numbers David was talking about involved granting up to 15 years of tax abatements on real estate, personal property, and sales tax for a data center project. When I see something like that, it gets at what David was talking about. The only true significant benefit of a data center is the tax revenue it could bring. It doesn’t bring a lot of jobs. It takes a lot of electricity and a lot of water. It generates noise. It already makes a lot of people upset, and there are concerns about housing values and everything else. So if you’re not getting any tax revenue, there really is no strong incentive to have a data center project. That Emerson complex in Ferguson had thousands of employees. A data center does not take very many employees at all. So when you have people coming up and saying this data center project won’t succeed unless we get all these tax subsidies, I say that’s fine and I hope you don’t build a data center there, because the tax revenue is really the only benefit you’re getting from it. One of the bigger things is just something about Missouri in general. I’m from Tennessee and there are a lot of concerns there about having too much growth. Missouri sometimes feels like the opposite of Tennessee. We’re so desperate for growth that we’re willing to hand out a bunch of money. We don’t have enough pride. This Emerson complex is a good building and a good place. Ferguson has a STEM high school that produces very high test scores and graduates people who can work in the tech industry or an engineering industry. We shouldn’t waste a good building and a good workforce on a project that’s going to get all these tax subsidies and not bring a lot of jobs. The same thing happened over in Independence, where they gave out billions in subsidies for a data center project. Whenever I see that, I think we have to have a little bit of pride in Missouri. We can’t just be giving out all this money to get anyone to come. We have a good parcel of land, a good workforce, a lot of water, and a central location in the country. We can attract good projects, data centers or not, without giving out a bunch of subsidies. We need to understand what the benefits and costs of a data center are and what data center developers are actually looking for. They have a lot of money already. If you give them a good workforce, a place to build, and community support, I think they’ll come, even without a bunch of money.

Elias Tsapelas (38:28): I was really hoping this was the discussion we were going to have this year in Missouri’s legislature, because it started off so well with the discussion of how to get rid of the income tax and everything that goes with that. Talking about the income tax is really about how you make your state more desirable and how you grow faster. But Missouri for so long has just said: we want this industry or this type of business, so let’s give it an economic development tax credit. Let’s give out a billion dollars worth of those. Let’s give out sales tax exemptions. As far as I know, data centers in Missouri already get state and local sales tax exemptions. We just give those out. If we’re really going to start thinking about how to make the state the most desirable place, how to grow the fastest and be the most desirable for families and businesses, that’s really more about making the tax climate the best for everyone, not constantly picking winners and losers. Unfortunately, the budget didn’t see as many cuts as I had hoped. As we go into the last few days of the legislature, there are plenty of tax credit bills waiting to pass. The film tax credit is back and there’s talk of extending the sunset on it. There are other tax credits. We’re still going down that path. There are still more sales tax exemptions being considered. Missouri just needs to decide what direction we want to go, because ultimately if we do get rid of the income tax, a lot of these economic development incentives don’t even really work anymore. You have to look at different things. You have to look at what is really the criteria for families and businesses. States across the country are dealing with these issues, changing their economic conditions, their tax policy, and people are moving there. We know people are leaving Missouri. We know income is leaving Missouri. We need to change things. The status quo is not going to work going forward, and I was hoping that would have sunk in a little bit more this year than it did.

Zach Lawhorn (40:37): We will leave it there this week. We’ll talk to everyone again after the session ends over the next few days and see how everything turned out. As always, plenty more at showmeinstitute.org. David, Avery, and Elias, thank you very much.

The post Missouri’s 2026 Legislative Session Final Week appeared first on Show-Me Institute.

As a recent op-ed in the Wall Street Journal reports, high-tax states continue to bleed residents and income. Between 2022 and 2023, California lost a net $11.9 billion in adjusted gross income (AGI), New York $9.9 billion, and Illinois $6 billion. Higher earners with income over $200,000 drove much of this exodus. In Massachusetts, they accounted for 70% of outflows, doubling the 2019 share.

Meanwhile, no-income-tax states saw the largest gains. Florida added $20.6 billion in AGI, Texas $5.5 billion, and Tennessee $2.8 billion. Even non-income tax states with more frigid climes saw significant inflows, including Wyoming and South Dakota. In short, states without income taxes dominated the top destinations for both people and wealth.

Missouri, with its current 4.7% top individual income tax rate, sits in the middle of the pack. While we are not a major loser like California or New York, we are far from the magnet status of Florida or Tennessee. Drawing upon IRS migration data, past Show-Me Institute reports have shown that Missouri has consistently lost more people and more income than it gained. This has been particularly the case among working-age and higher-earning households seeking better economic climates.

These national migration patterns emerge at a pivotal moment for Missouri. State lawmakers recently approved HJRs 173 and 174, a proposed constitutional amendment backed by Governor Mike Kehoe that would ask voters to authorize the gradual phaseout of the state’s individual income tax. If approved, the general assembly would begin reducing the tax as revenues grow and would have the authority to speed up the process while modernizing Missouri’s outdated sales tax code.

Eliminating the income tax would align Missouri with proven winners in the migration data, making our state far more attractive to high earners, businesses, and young professionals—key drivers of growth. Moreover, we sit right next door to Illinois, which, while losing top earners at a breakneck pace, is also ranked the least friendly state for middle-class earners according to one report.

The pattern is clear. People and capital continue to flow to states with lower tax burdens and pro-growth policies. Missouri has the chance to join those states. By modernizing our tax code now, we can shut off the outflow of the past and build a more prosperous future.

The post Missouri’s Opportunity to Attract Talent: Latest IRS Data on “Voting with Their Feet” appeared first on Show-Me Institute.

Susan Pendergrass speaks with Aaron Renn, author and consultant, and David Stokes, Director of Municipal Policy at the Show-Me Institute, about the recurring debate over whether the city of St. Louis should rejoin St. Louis County. They explore what city county mergers have actually accomplished in places like Indianapolis, Louisville, Nashville, and Lexington, why a full merger in St. Louis would be extraordinarily difficult to pull off, and whether the benefits would even outweigh the costs. They also discuss St. Louis’s demographic challenges, what the Pittsburgh model might offer as a path forward, the cultural barriers that make it hard to attract and retain people from outside the region, and more.

You can find Aaron’s work here.

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Episode Transcript

Susan Pendergrass (00:05): Welcome back, Aaron Renn, to the podcast. So happy to have you and David Stokes, our own expert on cities and counties and all things municipal. I appreciate you coming on, Aaron. There have been murmurings around St. Louis again on a topic that we have revisited for probably a hundred years: should the city of St. Louis be a separate county from St. Louis County?

Before we get to that, I want to ask you something because I was reading the news this morning, and I know that you’ve written about city county mergers before, like cities that are kind of dying and then either pulling in parts of their closest suburbs to sort of make everything look better, broaden their tax base, make their crime numbers look better. I was reading something you wrote a year or two ago about that, and you said that Louisville is a failed example of that. Is that right, basically?

Aaron Renn (01:01): Yeah, I’m a little skeptical of how these things have worked out in practice.

Susan Pendergrass (01:05): Yeah, in terms of losing the flavor and the coolness of the city. Literally this morning I saw an article about how Louisville is having a renaissance and these young professionals are all moving there because they didn’t tear down all their beautiful old Victorian homes, so you can still get one for close to a million dollars. They’ve got a cool art scene and a bourbon scene. So it sounds like maybe Louisville did not lose its personal flavor in the merger. I would be curious to know what you think of that.

Aaron Renn (01:33): Well, I like to put St. Louis in context. I’m glad you mentioned Louisville because many of these river cities have similar characteristics. I like to look at St. Louis as well as three cities in the Ohio Valley: Louisville, Cincinnati, and Pittsburgh. All of them heavily German Catholic in their demographics. All of them are very geopolitically fragmented with many small tiny suburbs throughout. They all have very fragmented neighborhood systems as well, where everybody has a strong sense of neighborhood identity. Where you go to high school is a big social marker. They all have phenomenal collections of urban assets and great historic buildings. They all still have their own unique character in a country where that has sort of bled away.

Aaron Renn (02:31): And they also have curiously underperformed demographically and economically in terms of growth. They’re slow growth places. So one thing I always encourage people is to pan back the lens and don’t just look at St. Louis in isolation. Look at it in comparison or dialogue with some of these other places and see what you can learn from them.

Louisville is actually a quite troubled city in important ways. From a white collar employment perspective it’s doing well, from a blue collar perspective less so. It’s one of the 10 least educated major metros in the country. I don’t want to spend too much time on Louisville, but I want to talk about the city county merger, which is distinct from recombining the city and the county. This has been considered urban planning best practice for 30 or 40 years. There was a book written by David Rusk called Cities Without Suburbs. The idea is that cities that were able to expand their boundaries through either annexation or city county mergers were prospering, whilst cities that did not, like the Clevelands, the Cincinnatis, and the St. Louises, were struggling. So the idea is we need big box government.

Indianapolis, where I live now, had a city county merger in 1970. Louisville did a city county merger, I grew up near Louisville. Jacksonville, Florida, Lexington, Kentucky, and Nashville, Tennessee did as well. What I would say is a few things. Merger is not necessarily bad. For Indianapolis, merger did prevent the city from essentially going down the tubes in important ways. So it really was a win in important ways.

But it did not prevent the historic city from going into the exact same demographic decline as St. Louis. The historic city of Indianapolis has lost almost exactly the same share of its population since 1970 as St. Louis has. Secondly, these are very politically difficult to pull off. They take enormous effort. They often fail multiple times. Louisville had multiple failures.

The most precious resource is always management time and attention. Is this where you want to put all your political chips? And in order to get it passed politically, what happens invariably is that most entities are actually not consolidated. In Louisville, none of the existing incorporated suburban governments were in fact merged. In Indianapolis, the school districts weren’t merged.

This means you don’t necessarily get all of the benefits you think from consolidation, because many things are excluded. And then unlike a corporate merger, where there’s typically a lot of downsizing and cost rationalization, in city county mergers nobody ever loses their job and salaries and benefits might even be harmonized upward to the high watermark. So don’t expect it to save any money. Personally, city county merger might have some benefits for St. Louis. I’m not saying it would have no benefits, but in my opinion it’s not going to be a needle mover and most likely it would be extraordinarily politically difficult and uncertain to pull off.

Susan Pendergrass (06:00): Yeah, no question. It’s been very politically difficult. People don’t want to do it. However, we do have these little tiny school districts and police districts. We have, I don’t know, 28 911 systems. We have a lot of what looks like bureaucratic waste and red tape. To the extent that doesn’t get resolved in a merger, then what’s the point? But I do think, you know, we’ve been talking about the demographics of St. Louis. There were over 800,000 people in the city once. Now there are maybe 280,000 and declining, and we’re in the death spiral of more people dying than being born. We’ve been in that for a while. And I guess it brings up the question of what is St. Louis to do if we are in this death spiral? We’re not having the babies. We’re having fewer babies than we did 15 years ago. So school enrollment is only declining. What is the prescription in that situation?

I’ve been to Cincinnati quite a bit. They’re trying to get people downtown with sports stadiums. It doesn’t really work. Louisville has sports stadiums downtown. I don’t know if people really want to move down there. I don’t see it working in St. Louis. So what is a city in that situation to do?

Aaron Renn (07:18): It’s going to be challenging in a sense because your problems are a little over determined. St. Louis was once a regional capital city, much like a Dallas or an Atlanta or a Denver or a Minneapolis. And it lost a lot of those functions. Many of its headquarters have left. It used to have a lot of professional services firms like ad agencies that did business all over the country, not just for the local market. Now St. Louis, although it’s still bigger than Indianapolis, looks a lot more like an Indianapolis or a Columbus, Ohio, where you have fewer corporate headquarters and most of the service firms are just there to serve the local market. St. Louis has essentially shrunk a little bit in relative importance, and it’s hard to get that back.

The demographics are also quite difficult and create a situation where it’s hard to attract business when you have a shrinking labor force, weak demographic growth, and a weak ability to bring people in from the outside. So it’s a very complicated situation and I don’t think there’s any silver bullet for St. Louis.

Susan Pendergrass (08:39): That’s what I’m asking you for. You have the answers. What’s the silver bullet?

Aaron Renn (08:43): So here are the things I would look at if I were in St. Louis. One of the clear issues that affects all of these river cities is that their wonderful, unique local cultures come with a downside, which is an extreme parochialism that has two negative effects. One, it makes it difficult for the communities to cohesively work together, which I’m not telling you anything you don’t already know. City-suburb divides tend to be bigger. In Indianapolis, regional leadership is mostly all on the same page about the big issues. Same with Columbus, Ohio. Secondly, it makes it very difficult to attract people from out of town because they come there and they can’t make friends, they can’t penetrate the social networks.

Susan Pendergrass (09:15): 100%, yes.

Aaron Renn (09:40): You hear it over and over again in places like St. Louis, Cleveland, even Minneapolis, Minnesota. There are some sayings there. If you want to make friends in Minnesota, go to kindergarten, because that’s when everybody makes their friends. Or Minnesotans will give you directions anywhere but their house. They’re never going to invite you over. St. Louis has that reputation. I don’t think it’s just a reputation. And I know you just had Ness Sandoval on.

Susan Pendergrass (09:53): Yeah.

Aaron Renn (10:08): He’s talking about you need to get better on migration. Migration isn’t going to improve if migrants are not going to be able to join the social networks here. And that’s not even just international migration, that’s domestic migrants. So I think that’s a huge issue for the city. Cultural issues are hard to solve, but maybe less intractable than infrastructure.

The other thing is looking at Pittsburgh as a sort of model. Pittsburgh hasn’t solved really most of its problems by any means, but it has been able to regenerate in the city a sort of high value economy around Carnegie Mellon and the University of Pittsburgh Medical Center. It’s done quite well. Many Silicon Valley firms have set up shop there. What’s happened in Pittsburgh, although it’s still a demographic decline story, is there’s been a demographic transition in the city. Pittsburgh went from one of the least educated cities in America to now one of the youngest and most educated. Part of it is old people moved and died off and young educated people replaced them. So the total number of people in the city was declining, but there was a churn happening underneath. And the same thing is already happening in St. Louis.

Susan Pendergrass (11:13): How did they do that?

Aaron Renn (11:33): College degree attainment in the city is now well north of 40%. So the people who live in the city of St. Louis are very educated. That demographic churn has raised educational attainment and thus incomes in the city a lot. Now Pittsburgh was different because it was an almost entirely white city. There’s a racial divide in St. Louis and gentrification concerns become more salient. But St. Louis is now an educated city. This is not an old post-industrial blue collar city. The city of St. Louis itself is very educated. And also being very small, it doesn’t necessarily need a massive change to move the needle. In Indianapolis we have a population of over 900,000. Moving that behemoth takes a lot. St. Louis now being smaller has a situation where there could be a big impact from lower numbers of things. So I think a knowledge economy built around Washington University and your medical centers has some possibilities, somewhat similar to Pittsburgh.

Susan Pendergrass (12:45): So much medical.

Aaron Renn (12:58): Carnegie Mellon’s engineering and computer science areas will be a little different. I might also look at Vanderbilt, what’s going on there? What are some peer schools you could watch to see what’s going on? But I think there are actually some reasons to think that the city of St. Louis, believe it or not, could be sort of turning a corner. It has now demographically renewed itself to a higher educational attainment state. Being small, it probably doesn’t have that much further to fall, and you can start building from there. Obviously there are governance challenges, but looking at the Pittsburgh model, studying similar complexes around peer schools, and addressing the culture issues is where I’d look.

David Stokes (13:33): Hopeful.

Susan Pendergrass (13:47): So as a spokesperson for St. Louis, what do you see for the future?

David Stokes (13:52): Well, I would be curious to get Aaron’s thoughts on that size question, about how the city of St. Louis has in fact gotten so small. It’s about 10% of the metro area. How does that affect the pros or cons of any type of a merger? These would not be a merger of equals. St. Louis County would almost subsume St. Louis City into it. How do you think that would affect things for better or worse?

Aaron Renn (14:28): Well, that was the critique of the Louisville merger by two academics at the University of Louisville. I mentioned the book Cities Without Suburbs. They wrote an academic paper called Suburbs Without a City, which basically said if the merger passed in Louisville, it would essentially mean the suburbs take over the city, not the city taking over the suburbs, because the old city of Louisville only had about 260,000 people and the suburbs would numerically dominate. The same thing would certainly happen in St. Louis. If there were a merger, suburban St. Louis County would control the city in essence.

Another consideration, and this is a Cincinnati issue, I interviewed about 15 years ago the mayor of Cincinnati, John Cranley. Here’s what he said, and I think this is an important point. He said, 30 years ago, city county merger was the thing because cities were in decline and you wanted to tap that suburban tax base to fund the city. But now it’s reversed. Now the cities are coming back and it’s the inner suburbs that are actually going down the tubes. And so in Cincinnati today, we have all the corporate headquarters, we have the universities and the medical centers, and we don’t have to share our tax revenue with anybody. If we were merged with the county government, we’d have to prop up all these failing suburbs. And so I think you’re in a similar situation in St. Louis, where the high value activity, not all of it is in the city of St. Louis because of Clayton and so on, but the St. Louis County suburbs are mostly places that are themselves on negative trajectories. Merging the city, which may be on the cusp of being able to bottom out and turn around, with all of these still declining inner suburban areas, might actually be an albatross around the city’s neck.

Susan Pendergrass (15:16): What would that mean?

David Stokes (16:37): I just think one of the differences between St. Louis and Cincinnati, and I don’t know the property tax base of Cincinnati, is that so much of the city of St. Louis is tax exempt right now. Between Washington University, Saint Louis University, and all the government entities, there’s just so much of it. I say that as somebody who supports property tax changes to make them pay something towards it. But I just don’t think the Cincinnati argument applies to the city of St. Louis right now. That property tax exemption part is a huge factor because the most growing, thriving part of it is the entire giant Barnes-WashU-Cortex complex, and the amount of property taxes they pay is miniscule.

Susan Pendergrass (16:38): Hmm.

Aaron Renn (17:26): Well, some of that is a planning issue. And I think the reality is, when you have a complex like that, are all these people going to move to St. Charles? Maybe not. I’ll tell you, I live in the suburb of Indianapolis named Carmel, and a lot of the hospitals and things have been opening facilities here. When these nonprofit hospitals come up here, we will not approve zoning changes for those hospitals unless they agree to make payments in lieu of taxes. You want to come up here and you want a zoning change, you’re going to have to pay. We were actually quite prescient in that one of the local hospital chains opened a for-profit hospital. As part of the approval deal, we said, if you ever convert to nonprofit status, you will continue paying property taxes. And we did that.

So I think there probably is leverage from the city over some of these entities. You don’t have a lot of leverage over a corporation deciding where to put their office, but that’s not a tax exempt situation. The stuff at Cortex is probably not going to leave if you make them pay a little money the next time they come to you for a zoning approval. I think you need to start looking at how to get more money out of these entities that are nonprofits in name only. These universities and hospitals are effectively gigantic hedge funds. Their executives are extremely well compensated and billions of dollars are flowing through there. Undoubtedly the better solution there is to figure out how to tax them rather than figure out how to tax the soon-to-be-dead mall in the suburb over the border.

David Stokes (19:24): Well, yeah, and that’s sort of the trade off, unfortunately, is that they do pay earnings tax. The employees, many of them very highly compensated, pay the earnings tax. And that’s what makes the city more dependent on local income taxes, not less, because they’re either tax exempt or in the case of Cortex, have tax abatements that make them essentially tax exempt.

Susan Pendergrass (19:25): We do have earnings taxes, right? So the folks who work there have to pay an earnings tax.

Aaron Renn (19:53): Yeah. Again, I don’t know exactly the fiscal architecture there. But I would say you don’t want to do a merger simply to do a tax dollar grab. The lesson of Indianapolis is we did that. We grabbed suburban tax dollars and we used it to rebuild our downtown successfully. But here we are 50 years later, and now we have enormous tracts of decayed suburbia that are an enormous problem. Our entire core county is now in a sense the inner city. We have big challenges because we were not able to invest in ways that allow those suburban areas to retain their allure over the long term.

And I’m not saying that’s impossible, but any short term juice you get, cities always rise and fall. Core cities have proven more resilient and more able to regenerate themselves than suburbs. Part of it is because state governments cannot afford to let their state’s largest city or major urban center go down the tubes.

Susan Pendergrass (21:06): Yeah.

Aaron Renn (21:16): Missouri cannot let St. Louis and Kansas City implode. Michigan cannot just write off Detroit and say who cares. But these suburban areas have proven a lot tougher to save. We don’t have a good model. We’ve spent decades thinking about how to rebuild cities and build districts. There are certain things you can pull off in a city around conventions, civic events, gathering spaces, museums, and government that are very hard to translate to suburban settings. So there’s not a great playbook, especially in declining markets, for renewing suburbs. The playbook for suburban renewal, if you want to call it that, is places like Carmel, Indiana, which are growing and affluent, and therefore can build large mixed use centers, new urbanist developments, trails, and parks. The suburbs of St. Louis County are probably tremendously deficient in infrastructure as we would understand it today.

So again, there may actually be some benefits in having St. Louis City rejoin the county in a sense, because then the county functions are spread and amortized across a larger population.

Susan Pendergrass (22:45): It would immediately improve our murder rate because we would be mixing it in.

Aaron Renn (22:48): Yeah, there is some of that. The murder rate is an artifact of the size of the city more than anything. There are places in Chicago with higher murder rates. A former colleague of mine at the Manhattan Institute, Rafael Mangual, did an analysis of Chicago. He said there are areas on the South Side of Chicago that are larger and have more people than St. Louis with far higher murder rates than St. Louis.

Susan Pendergrass (22:56): We get called out because of the small denominator.

Aaron Renn (23:17): And so there is that. The other thing is Chicago is a good example. New York City was essentially a city county merger. In 1898, the five counties that are the five boroughs of New York were consolidated into one city. Philadelphia was also a city county consolidation from the 19th century. But what happens when you create a very large city of say a million people or more is you really have to scale up your government. You have to have a government that operates at that scale.

What happened with Indianapolis was we merged city and county government, but we didn’t really have a government that could effectively manage this new larger territory. It never built out the infrastructure in the suburbs. In New York, the Bronx has subways, great parks, everything built out with proper infrastructure, because it was part of New York and New York had to expand governance to become a city of eight million. Chicago got big in the 19th century and built a city government that could run a city of three million people. And some of the stuff that gets critiqued there, for example, is a lot of city services were organized by ward or city council district. There are 50 city council districts and every city councilor is sort of a little mini mayor of their district. The alderman essentially has veto power over any zoning changes. It’s called aldermanic privilege. So there are a lot of constraints there.

But if it’s just one mayor and one city council trying to think about a huge city of 77 neighborhoods and three million people, they can’t keep that much in their head. All they can think about is downtown. And that’s what happened in Indianapolis. The mayor and city council can really only think about downtown. We should have built out structures in townships throughout the city so that you had leadership focused on that area and money focused on that area. That’s what made the suburbs work really well. A suburb like Carmel is basically township sized. We have 100,000 people, big enough to do things, but not so big that our mayor and council can’t keep the whole city in their head and plan and manage the whole city.

So if you merge with the county government, you’re going to have to create an entirely new government structure that allows you to essentially manage every sub area of the whole thing and bring it all up to a standard of services. That’s the other thing they often did in Louisville and Nashville. They merge, but they have a two tier service system where there’s an urban services district for the old city which gets more services, and then the others get less. They didn’t do that in New York. There’s one standard of service in New York, one in Philadelphia, one in Chicago. So if you can’t commit to a single standard of service, you’re basically creating a bogus merger in my opinion. If you’re going to do a merger, you need to obliterate every government and entity in St. Louis County and city, merge them all into one with one standard. That’s not going to happen.

Susan Pendergrass (26:35): That’s not going to happen. What do you think, David?

David Stokes (26:37): Yeah, that’s not going to happen.

Aaron Renn (26:43): So you end up with a lot of problems. Louisville didn’t merge any fire departments. Imagine a city that doesn’t have a consolidated fire department. Imagine a city without a single police department. That was actually Indianapolis. When we merged, the Indianapolis Police Department still patrolled the old city, but the new parts of the city that were consolidated in from the county were still controlled by the sheriff.

Susan Pendergrass (27:13): That is 100% what would happen in St. Louis. Everyone would retain their school system and their police department and their fire department. I lived for a long time in Fairfax County, Virginia, which is a single county government. It’s massive, 150,000 students in their school system. It seems to function with a single police department and fire department. But I don’t think you can backwards engineer that into a place that for hundreds of years has been operating as it has been operating.

Aaron Renn (27:43): Lexington, Kentucky worked pretty well because one, the schools were already consolidated, as in the South it’s typically county school districts. Secondly, there were no other government entities, no township governments, no other incorporated municipalities. So it merged everything. And they were sort of able to solve the urban services district issue because the outer areas of Fayette County were horse farms. They actually put in a kind of green belt rule, you can’t develop out there, because they wanted to protect these scenic landscapes. So there was actually a good reason to treat that differently, because it was a very unique American landscape. Lexington, I think, was pretty successful.

Susan Pendergrass (28:15): They are. I appreciate it when I drive across Route 64.

Aaron Renn (28:39): Lexington was pretty successful and wasn’t especially controversial when they did it, in part because there weren’t all these entrenched interests like there are in other places. If you look at places that did the mergers, they weren’t the Cincinnatis and Pittsburghs. They’ve been talking about consolidation in Pittsburgh forever. It was very hard. And Louisville did it, but it was one of the least consolidated so-called consolidated governments. What the Louisville merger functionally did was dissolve the city of Louisville and reorganize county government. The county government now has a mayor and a council instead of the old fiscal court with the judge executive and all that.

Susan Pendergrass (29:21): That’s kind of what would happen in St. Louis, right?

Aaron Renn (29:36): That’s essentially what they did. They basically dissolved the city and the county government was reorganized, but nothing was merged.

Susan Pendergrass (29:43): Did you have a question?

David Stokes (29:45): I want to get back to the fire district point. We’re talking about why this would be so hard. There’s actually a law in St. Louis that only applies in St. Louis County that makes it impossible to consolidate fire districts. Even if a modest mid-sized suburb annexes an unincorporated part of town, they’re not allowed to provide fire services to that new annexed area, or they can, but they have to pay so much to the old unincorporated fire district that it makes it impossible to do so. That’s just one example of how even if you wanted a full scale merger, it would just be impossible to actually carry through.

Susan Pendergrass (30:34): Why do you think people float this idea, David? Why does it come back every couple of years?

David Stokes (30:38): You know, it’s the old line. I remember a study I read about Pittsburgh and St. Louis many years ago. The question was, are the St. Louis and Pittsburgh areas really inefficient with all the fragmented government? And the conclusion was, well, you would never design a metro area like this, but they’ve both made it work over the last century better than you would think. The conclusion was that St. Louis and Pittsburgh aren’t actually as inefficient as you might assume when you run the numbers.

I think people have trouble accepting that. People look at so many small municipalities, many of them dysfunctional, many of them until recent times funded themselves primarily with traffic tickets, which is a terrible way to fund local government, and that’s not even an exaggeration. And there’s just this fundamental belief that if you can just plan it better you’ll create a better place. I just think it fails.

One of the reasons it would fail, going back to what Aaron led this conversation off with, is that if St. Louis County and St. Louis City joined together, they’re not actually going to lay any government employees off to save any money. St. Louis City government is not going to fire city employees. It’s never going to happen. So you’re not going to save any money and it’s all just going to collapse.

Aaron Renn (32:12): Yeah, New York City and large governments are not more efficient.

I look at it and say, look, I think merger is a solution for failed states, if you want to call them that, in the St. Louis suburbs. Take some micro-suburb that’s a complete scam or is bankrupt and merge it in with its neighbor. Do some consolidation like that, that probably needs to be led by state government, almost like a receivership sort of thing. That’s just kind of good government as you work through it. But I just don’t think the benefits you would gain from trying to do a complete governmental merger of St. Louis City with St. Louis County would outweigh the opportunity cost of how much time and effort you spend on it, when you could be spending that on other things that I think will actually move the needle more.

The downsides are arguably as high as the upsides. There’s no guarantee it’s even net positive in this environment. The time to have merged was when Indianapolis did it in 1970, not in 2026. Nashville did it in the 60s. Jacksonville did it a long time ago.

And then I think it doesn’t fix the fundamental issues around the culture. You’ve got to take a hard look at that and say, it’s maybe very difficult to change. The idea that people who aren’t from here have to be able to move here and get connected and feel like they belong in the city. There’s a couple we know who lived in St. Louis. The wife taught in St. Louis public schools. They’re big urban people. The husband was from St. Louis, and they moved here to Carmel, Indiana.

Susan Pendergrass (33:47): Tell me more about that.

Aaron Renn (34:10): Basically they said, man, people are just so much friendlier here. They make better eye contact, they engage more. It’s just so much more welcoming than it was in St. Louis, even though they were actually in a sense connected because the husband was from there.

So when even people who lived in St. Louis and liked it notice a difference when they leave, that is a killer when you’re already struggling demographically. I had a guy who owned a business in Cleveland who said to me one time, I learned the hard way never to recruit anyone from out of town to work for my company unless that person or their spouse is from Cleveland, because otherwise they will never stay. When that’s where you are as a place, that is just rough. I think that is one of the killers for these river cities.

Susan Pendergrass (35:16): Yeah, what’s the fix for that? I don’t know what the fix is.

Aaron Renn (35:38): I think the optimistic case for St. Louis, and I actually tweeted this a year or two ago, is that St. Louis City educational attainment is really high now. In a sense, it’s a small, highly educated city that is probably going to continue growing more educated. So I think the Pittsburgh option looks viable in St. Louis.

Susan Pendergrass (36:00): And certainly great medical care. I know that the average age is getting older in St. Louis. I think within 10 years, one in four people will be over the age of 65. But we also have an Alzheimer’s research center and access to medical care, which as you get older gets more important. I do think there’s an opportunity to lean in to the medical services that are available, as the country as a whole gets older. I think St. Louis looks more attractive for that reason. So I think you’re right that with universities and medical centers, there’s an opportunity.

Aaron Renn (36:35): Yeah, I think if America’s demographics keep on this trend, a lot of other places are going to get to where St. Louis is. And the thing to be careful of is that when you’re in a declining market, that often prompts centralization of activity and population. What happened with Japan is that once Japan’s population started falling, everybody started moving to Tokyo. It’s Tokyo and a handful of other cities where everything is concentrated, and they literally have ghost towns there.

I don’t think it’s any accident that Indianapolis’ growth really took off once the Rust Belt era and deindustrialization hit the state. Indianapolis and Columbus, Ohio have grown in large measure through drawing people out of the rest of the state as those states declined. Huge numbers of people move from Cleveland to Columbus every year.

Missouri is a little different than that. One of your challenges is that St. Louis does not draw people from rural Missouri. When I looked at the data, it’s not like there’s a massive flow into St. Louis from the rest of the state. So you don’t have that siphon bringing people in.

Susan Pendergrass (37:55): There are public safety issues around that, but yes.

Aaron Renn (38:00): And the issue we have is that we’ve now eaten our seed corn. There’s not going to be next generations of children in the towns I grew up in in rural Indiana to move to Indianapolis anymore. The cohort sizes are going to be smaller. So that pump, even Tokyo is declining now in population. That siphon is draining the water table. We can only rely on that so long.

But I think this is the risk for St. Louis in that kind of environment. People with opportunity might avoid or flee St. Louis and go to Austin, Texas or Nashville. They go to the handful of places in America that are really still growing. That’s a threat even for Indianapolis and Columbus, Ohio. In a declining market, it’s very hard to get people to want to come to a shrinking city because the opportunity space is shrinking. St. Louis’s opportunity space has been shrinking because you’re losing corporate headquarters and your working age population is declining. That dynamic is really going to be a challenge. But within that, the city of St. Louis might end up doing okay. Again, being small actually helps it here.

Susan Pendergrass (39:25): Any closing thoughts on that, David?

David Stokes (39:27): Just that the part of Missouri that is definitely still growing, and that probably is attracting those young rural people who are moving to a city, is going into southwest Missouri, the Springfield-Branson area. That’s absolutely the growing part of the state. And even Kansas City is growing certainly more than St. Louis is.

Aaron Renn (39:48): Yeah, it’s not a culturally cohesive state. Springfield and that area are definitely growing, and growing despite the fact that they have nowhere close to the urban assets of a St. Louis. It’s interesting to watch, and we’ll just have to see what happens.

Susan Pendergrass (40:05): It is. I think about it a lot. I’ve been talking about this in terms of school enrollment for years and years, where you could see the biggest kindergarten cohort was after the Great Recession of 2009. You know that that’s the biggest kindergarten cohort for the last 15, 16, 17 years. We do nothing but build schools and hire teachers. We are slow to catch on to these things happening. But I think your perspective is certainly very interesting. On the question of the merger, it’s not worth the cost for whatever benefits there might be. But it still gets talked about, so I appreciate you coming and giving us your thoughts on it. Maybe we’ll have to have you back to talk about it again.

David Stokes (41:02): And Aaron, I want you to come back. I want to find out how we get more roundabouts in Missouri. I love roundabouts. I go to Carmel it seems like once a year for these gigantic youth sports tournaments up at Westfield, just a little bit north of you. My kids’ sports take me there. And I love the roundabouts. You cannot get enough of them.

Aaron Renn (41:09): I’d love to talk about that. My favorite topic.

Aaron Renn (41:24): Yeah, it’s great. We hardly ever have to stop. There are barely any stoplights or stop signs left in our city. It’s amazing. We’re one of the few growing places in America where traffic is better today than it was 20 years ago.

Susan Pendergrass (41:32): They’re awesome.

David Stokes (41:45): People don’t realize how good that is for air quality and everything. You just keep moving along, not stop and start. We need 100 times more roundabouts in this area.

Susan Pendergrass (41:55): Are you pretending that people stop at stop signs in St. Louis? Because let’s be honest, people don’t stop at stop signs.

David Stokes (42:00): Well, they roll them, but it’s still wrong when they roll them. Maybe all the people blowing red lights on Kings Highway at 50 miles an hour are just being environmentally conscious. I need to give them more of the benefit of the doubt, I guess.

Susan Pendergrass (42:12): That’s exactly right. All right, thanks so much. I really appreciate it.

Aaron Renn (42:19): Thank you.

Produced by Show-Me Opportunity

The post The St. Louis City-County Merger with Aaron Renn and David Stokes appeared first on Show-Me Institute.

The newest demography newsletter from Saint Louis University delivers a jarring wake-up call that regional leaders can no longer afford to ignore. For years, the conversation around St. Louis has been one of stagnation, but the 2025 population estimates from the Census Bureau reveal we have shifted onto a much more dangerous track toward structural decline. While the national birth rate is falling, St. Louis has emerged as an epicenter of this trend, ranking first among the fifty largest metropolitan areas in the percentage decline of births since 2021 (9 percent). We are now in a state of demographic winter where deaths outnumber births, and unlike our neighbors, we do not have a steady stream of new residents moving in to offset the loss.

When we look at our peers in Indianapolis and Nashville, the contrast is stark. Indianapolis has seen a domestic migration gain of nearly 20,000 people since 2020, while Nashville has increased by 89,000. Meanwhile, St. Louis saw over 31,000 people leave for other parts of the country during that same period. St. Louis is heading into a period in which it will carry a much heavier demographic burden of older residents compared to these peer cities, which are successfully maintaining a younger and more sustainable age structure.

Both of these other regions have more childbirths annually than they did just five years ago. But this isn’t just by chance. Indianapolis has aggressively aligned its economic incentives with family needs, requiring companies that receive tax breaks to reinvest in childcare and neighborhood infrastructure. Indianapolis families can also choose between universally available private school vouchers, charter schools, or any traditional public school in the district. Nashville has used Tennessee’s lack of a state income tax to attract high-earning families and has focused on building the kind of walkable, tech-ready neighborhoods that remote-working parents prioritize. Both cities have created an environment where it is easier and more affordable to raise a family, which in turn fuels both natural growth and domestic migration numbers.

St. Louis is currently operating under the outdated assumption that we will always have 35,000 births a year to sustain our schools and workforce. The reality is that we have declined by over 7,000 births annually since 2011, and that number is still searching for a bottom. If we want to avoid a future of shrinking school districts and a hollowed-out economy, we have to stop treating these numbers as theoretical. We must move toward a strategy that makes St. Louis a destination for families again, rather than a place they leave behind.

The post A Wake-up Call for St. Louis appeared first on Show-Me Institute.

Momentum for early literacy reform continues in Jefferson City, as House Bill (HB) 2872 recently passed out of committee.

While this version removed several provisions from the original bill, it retains the core components necessary to meaningfully improve early reading outcomes. As HB 2872 continues to move through the legislative process, it is critical to preserve two elements.

#1. A Clear, Firm, and Objective Third-Grade Retention Policy

Under HB 2872, a student who scores at the lowest level on a state-approved Missouri reading screener will be retained unless the student completes a summer reading program and scores above the lowest level on a retest opportunity, or qualifies for a good-cause exemption. Good-cause exemptions apply only to students with limited English proficiency, disabilities, or students who have already been retained.

Having a firm third-grade retention policy is important. An analysis of multiple states’ literacy policies found no consistent evidence that reading scores increase in states without a retention component. Critically, the value of the retention component is not just for students who are retained—it is also for all the students who are not retained because their reading scores improve. In most states with retention policies, the retention rate ends up being low; it is the threat of retention, more than retention itself, that spurs widespread literacy gains.

A number of states—Mississippi, Louisiana, Indiana, Florida, and Tennessee—use a rule-based retention policy. These states have seen significant gains in reading, and all have higher test scores than Missouri.

Without a rule-based policy, teachers and parents talk themselves into promotions that are ultimately to the detriment of children. It feels mean to hold a child back. But it is no kindness to promote a child from the third to fourth grade if the child cannot read. It is not setting the child up for success.

HB 2872 requires that parents be notified if their child is identified as having a reading deficiency at any time during grades 1–3. This level of transparency can help parents be part of the solution for their children.

Retention can be a difficult experience, but research shows it is much easier on young children; it is primarily students in later grades who are negatively impacted when retained. Younger students who are retained under these types of policies benefit tremendously in terms of on-grade academic achievement, even years after retention.

#2. Accountability for Teacher Preparation Programs

It is also critical to align the training in teacher-preparation programs with evidence-based reading instruction. In 2023, the National Council on Teacher Quality evaluated teacher-preparation programs nationwide and awarded nearly half of Missouri’s participating institutions with an “F” for their coverage of scientifically based reading instruction.

HB 2872 allows the Department of Elementary and Secondary Education (DESE) to bring teacher preparation programs into alignment with the science of reading for the benefit of our students. Specifically, it allows DESE to review teacher preparation programs for compliance with evidence-based reading instruction and prohibit noncompliant programs from certifying new teachers.

The new version of HB 2872 that emerged from committee has changed in the following ways. The new bill:

• Has no explicit ban of the use of three-cueing (a reading method relying more on cues, guessing, and memorization rather than systematic phonics) in K-12 classrooms.
• Eliminates the proposed $500 incentive to districts for students who remediate a substantial reading deficiency.
• Redefines the Missouri Reading Screener to include multiple DESE-approved assessments rather than a single (new) statewide test.

These changes weaken the bill, but are secondary to the structural pillars of reform: an objective, assessment-based retention rule and stronger accountability for teacher preparation programs. As long as these pillars are in place (especially retention), HB 2872 represents meaningful progress.

We encourage our Missouri lawmakers to continue to take our literacy crisis seriously and to enact policies that help more Missouri students become confident, capable readers.

The post Early Literacy Reform Advances in the House appeared first on Show-Me Institute.

In his January 30 op-ed for the Post-Dispatch, Kansas political scientist Michael Smith called Governor Mike Kehoe’s proposal to cut income taxes in Missouri a “near carbon copy” of Governor Sam Brownback’s 2012 income tax cuts in Kansas.

But Kehoe’s proposal for Missouri has large and important differences from Brownback’s. It isn’t a “carbon copy” at all.

The single largest flaw in Brownback’s tax cut was a peculiar change that eliminated all income taxes on “pass-through” business entities such as limited liability corporations (LLCs) without changing the tax code for other types of businesses. Even the right-leaning Tax Foundation criticized the provision at the time. Put simply, it didn’t encourage investment; it ended income taxes for one type of business while keeping them for others.

Not surprisingly, many businesses changed their corporate structure to suddenly become pass-through entities. The Tax Foundation found that over 390,000 entities claimed the exemption by 2015, more than double what was projected. These businesses didn’t invest in the state, hire more workers, or do anything other than change their legal status. Tax revenues declined significantly, and little growth followed.

Kansas also made critical mistakes in how it implemented income-tax cuts. The state slashed its top income-tax rate by nearly 30 percent immediately in 2012, with plans to cut even further. At the same time, Kansas’s elected officials failed to rein in spending. The combination of the pass-through exemption, immediate and deep rate cuts, and lack of spending discipline during this period fostered a fiscal crisis that could have been avoided. Even worse, the timing of these actions gave the state little room to adjust when projections weren’t borne out.

Kehoe’s proposal is fundamentally different. It asks Missouri voters whether they want to eliminate the income tax. If they do, the state can then expand and adjust its sales tax to replace the lost revenue. While many details remain to be finalized (and Missourians have every right to be skeptical while awaiting those details), the plan ensures that income tax rates can only be lowered after meeting revenue benchmarks, meaning Missouri would only cut taxes when it has the fiscal capacity to do so.

Setting aside the phasing out of the income tax, addressing Missouri’s outdated sales tax system is long overdue. While states nationwide are broadening what they tax, Missouri’s system remains narrow, with much of what is sold today escaping taxation entirely. Larger exemptions like home sales and healthcare services might make sense, but other current exemptions clearly don’t.

When you buy a book in person at Barnes & Noble or have the same book delivered to your house by Amazon, you pay the sales tax. However, when you buy the same text as a download to your Kindle, you pay no sales tax. Correcting such inconsistencies in Missouri’s tax code can level the playing field while expanding the sales tax base at the same time.

Opponents can point to Missouri’s western border all they want, but Missouri has other neighbors besides Kansas. Look at Iowa, Oklahoma, and Arkansas, which have all cut income tax rates significantly in recent years without any of the issues Kansas had. Look to our southeast border to see Tennessee, a state that has been growing rapidly for years thanks, in part, to having no state income tax. This isn’t surprising, as decades of economic research have shown consistently that states without income taxes grow faster economically than those with them.

As the Tax Foundation, which was highly critical of Kansas’ tax cut, wrote in 2024 about the larger picture of state tax cuts between 2012 and 2022:

In fact, far from tax cuts precipitating a Kansas-like crisis, tax collections have risen more on average in the past decade in the 25 states that cut income taxes (31.9 percent in inflation-adjusted terms) than in the four states and D.C. that raised them (27.8 percent).

The lesson from Kansas isn’t that eliminating the income tax is a bad idea, it’s that implementation matters. There’s no doubt that states without income taxes are growing faster than Missouri, and our state needs a new approach to keep pace in the national competition for families and businesses. Voters deserve the full picture, not an overly simplistic “Kansas” bogeyman, when debating our state’s tax future.

The post Missouri Doesn’t Have To Be Kansas appeared first on Show-Me Institute.

The new task force is modeled similarly to Tennessee’s nuclear advisory council, which I have written about extensively. This nuclear-focused group will identify strengths to leverage, highlight regulatory and practical reforms worth considering, and serve as a touch point for potential partnerships both nationally and internationally.

After forming its nuclear advisory council in 2023, Tennessee saw notable success in attracting nuclear supply-chain and research investment, as well as a new small modular reactor (SMR) project. With a similar structure now in place, I am hopeful Missouri can achieve comparable success in bringing new nuclear investment to the state.

Missouri’s Advanced Nuclear Task Force Makeup

The task force is structured much like Tennessee’s; it is composed of different stakeholders from government, higher education, and the energy sector.

The task force is currently not a permanent body, and is required to submit an annual report to the governor and the Missouri Senate and House energy committees with a list of barriers to nuclear energy deployment and actional recommendations. It is set to dissolve after the submission of its third annual report, unless it is extended or dissolved beforehand.

What the Task Force Is Charged with Doing

As outlined in the executive order, the task force will help facilitate actionable next steps and reforms for nuclear power in Missouri.

Just as importantly, it will also be tasked with identifying public–private partnership opportunities and advising the governor on regulatory, technological, and economic developments in the nuclear sector.

With significant momentum and change in nuclear energy (trust me, I had to update my recent report on nuclear energy many times), the task force will be useful in helping Missouri policymakers remain informed and competitive.

One Suggestion in Implementation

While the executive order does not explicitly require national or international experts, the governor is granted latitude to appoint additional members. That flexibility should be used. Expertise in areas such as nuclear engineering, mechanical and civil engineering, and environmental law could meaningfully strengthen the group’s work.

Hopes for the Future

Missouri has taken a meaningful step toward nuclear investment and development. If the task force is used as intended, I am hopeful that Missouri can succeed the same way Tennessee has.

The post Missouri Forms an Advanced Nuclear Task Force appeared first on Show-Me Institute.

If you want great schools, you have to have great teachers. Lots of other things are important. Strong school culture, appropriate instructional materials, good curriculum, robust relationships with parents, all necessary. But it is the person, the actual human being, that puts all of that into play that is most important.

Mimicking the Tennessee Teacher Evaluation Model

Missouri could better support teachers by providing meaningful guidance and feedback. One promising model comes from Tennessee.

Launched in 2012, the Tennessee Educator Acceleration Model (TEAM) was designed to help educators improve. Teachers frequently express a desire to improve, but often lack resources or guidance on how to get better.

By using announced and unannounced in-class observations, academic growth data, and student performance data, TEAM calculates a teacher score (1–5 scale) that provides information to teachers and school leaders about teacher performance. The goal is not to punish teachers, but to coach them and help them improve. Observers identify one strength and one area for improvement in each lesson, keeping the process constructive, focused, and encouraging. The Tennessee Education Research Alliance at Vanderbilt University found that teachers in schools with stronger implementation of TEAM improved faster than those in schools with weaker implementation.

The evaluation promotes ongoing dialogue about what happens in the classroom and how it affects student performance, and provides a basis for professional advancement—e.g., high-performing teachers can be identified through TEAM for mentoring roles.

Initially, there was strong pushback against teacher evaluation in Tennessee, which is not surprising. At its launch, only 28 percent of teachers believed TEAM would improve student outcomes, and only 38 percent believed it would improve teacher performance. But those numbers changed quickly once teachers actually experienced TEAM, rising to 71 and 76 percent, respectively, by 2019.

Missouri should consider emulating Tennessee’s commitment to rigorous and constructive teacher evaluation. If we’re serious about improving school quality and student outcomes, we need to be serious about improving teacher quality.

The post Improving Teacher Quality to Improve Reading Quality appeared first on Show-Me Institute.

So how did charter schools perform during and after the pandemic? New research from Adam Kho, Shelby Smith, and Ron Zimmer, using student data from both charter and traditional public schools in Tennessee, suggests that they performed quite well.

Their analysis shows that during the 2020–21 school year, at the height of the pandemic, students in both charter and traditional public schools performed similarly—i.e., poorly. All schools were a mess during the pandemic. But in the two years that followed—the 2021–22 and 2022–23 school years—student learning in charter schools rebounded much more quickly than in traditional public schools.

To put these results in context, the authors note that charter schools were already outperforming traditional public schools in Tennessee prior to the pandemic. Given this, they interpret their post-pandemic results as follows: “in the first post-pandemic year . . . the [existing] charter school advantage . . . quickly resurfaced. In the second post-COVID year, the charter effect was even greater . . . suggesting that charter schools have been able to recover from pandemic-induced learning loss at a quicker and more substantial rate.” [emphasis added]

This evidence supports the idea that the less restrictive environment in which charter schools operate enables them to respond more effectively to challenging circumstances. The COVID pandemic was an extreme situation, but the same logic likely applies to the smaller, everyday challenges schools face.

The post Charters Have Outperformed Traditional Public Schools Post-Pandemic appeared first on Show-Me Institute.

These days, though, I have come to love St. Louis too. It is a big city with a small-town feel. I go to an amazing church, and there is always something new to do or see.

Growing up in East Tennessee, I know firsthand how much that region has been defined by nuclear innovation, a tradition that continues today. Recently, Oklo Inc. announced that it plans to build a $1.68 billion nuclear recycling facility in Oak Ridge, Tennessee, which is a stone’s throw away from my hometown. This project joins a wave of planned nuclear investments in the region, including a multibillion-dollar uranium enrichment facility and the planned construction of a new small modular reactor (SMR).

While I am excited for East Tennessee, I also want Missouri to grow and thrive. Leaders here have recognized the importance of nuclear power, with Governor Kehoe stating that we need to build new nuclear at “business speed.” If Missouri wants to attract the same kind of investment Tennessee has, we should follow its example, starting with the creation of a nuclear advisory council.

What Could a Nuclear Advisory Council Look Like?

Just as Missouri should take note of Tennessee’s zero-income-tax advantage, we should also learn from its policies on nuclear energy.

In my recent report, Nuclear Energy’s Past and Present: Guiding Missouri’s Future, I detail how the formation of a nuclear advisory council—modeled after Tennessee’s—could help fortify our grid and attract needed investment to our state. A council would bring together the brightest minds to provide accessible information, engage with stakeholders, and foster key partnerships at no cost to taxpayers.

Our state already has unique assets that position us well for nuclear development, and a council could advise how to best use these strengths. It could also flag weaknesses in regulation, workforce development, or siting. Further, a council could help identify opportunities for utilities or even independent off-grid electricity providers if our state allows it.

Tennessee’s council, created by an executive order from Governor Bill Lee, has already helped signal resolve to interested developers and foster a more nuclear-friendly environment. Missouri has the ability to do the same.

Creating a nuclear advisory committee is a simple first step. Hopefully, another big nuclear investment next door can motivate Missouri to follow in Tennessee’s footsteps (and maybe we can also start making all iced tea sweet by default, please).

Interested in this idea? Read a more in-depth analysis in my recent report:

Connecting Nuclear’s Past and Present: Guiding Missouri’s Future

Check out these other related articles:

Forming a Missouri Nuclear Advisory Council

Missouri’s Nuclear Opportunity with Avery Frank

What Could New Executive Orders on Nuclear Mean for Missouri?

The post Tennessee Lands Another Nuclear Project appeared first on Show-Me Institute.

Susan Pendergrass speaks with Show-Me Institute policy analyst Avery Frank about his new report, Connecting Nuclear Energy’s Past and Present: Guiding Missouri’s Future. They discuss why electricity demand is rising again, why major companies are turning back to nuclear, and how Missouri can position itself to benefit. From data centers and AI to regulatory hurdles and smart policy steps like a state nuclear advisory council, Avery explains how Missouri could play a leading role in America’s nuclear resurgence.

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Timestamps

00:00 The Resurgence of Nuclear Energy
03:37 Challenges and Historical Context
07:30 Missouri’s Nuclear Potential
12:06 Future of Nuclear Energy and Policy
16:09 Conclusion and Future Outlook

Transcript

Susan Pendergrass (00:00)
This morning we’re joined on the podcast by Avery Frank, policy analyst at the Show-Me Institute. You’ve got a paper out, and I’m really looking forward to talking to you about it because I have a lot of questions. You’ve done a lot of research and analysis around nuclear energy, and I see a lot in the media these days about the resurgence of nuclear energy.

Number one, why does nuclear energy seem to be back, bigger and better than ever? And secondly—well, I’ll start with that. Why is nuclear energy back in the news so much?

Avery Frank (00:34)

Nuclear power surged in the United States during the Cold War. Electricity demand was soaring—it kept going up and up. Nuclear energy is clean, reliable, and powerful. Just in Missouri, we have one nuclear power plant and it supplies 14% of the entire state’s electricity. So when you need a lot of electricity, nuclear power is something you can turn to.

Since 2007, electricity demand has pretty much flatlined as we’ve become more efficient. But with data centers, artificial intelligence, and electric manufacturing, electricity demand is back on the rise, looking similar to Cold War–era growth. Just data centers by themselves are supposed to go from 3% of U.S. electricity demand today to 8–12% by 2030. That’s a huge jump.

Susan Pendergrass (01:56)
Well, if it’s so great, why did it go away? I remember Three Mile Island, and I saw the movie about Chernobyl. When it gets bad, it gets really bad. Why did nuclear go away so hard if it’s such a great, clean, reliable source of energy?

Avery Frank (02:26)
I’d say it went away for three key reasons: public fear, regulation, and regulatory attitude. Most of the time, public fear from events like Three Mile Island drove increased regulation.

Two key events stand out. First, the National Environmental Policy Act (NEPA) *correction* in 1970. That was a huge blow for the nuclear industry. Construction costs went up 25% and projects took two years longer. Then came Three Mile Island in 1979. It was mitigated by safeguards, but public fear skyrocketed. Costs afterwards were three times higher and construction took twice as long. That was the big turning point.

Susan Pendergrass (03:54)
Then if it’s that expensive, why is it coming back?

Avery Frank (04:14)
Companies are turning to nuclear out of desperation. They need a lot of power, as I mentioned with data centers, but they also have clean climate pledges. They can’t really do it with solar or wind. They’re kind of backed into a corner.

Susan Pendergrass (04:20)
Why not solar or wind?

Avery Frank (04:39)
Solar and wind are intermittent resources. Nuclear plants run consistently. Data centers can’t have outages—you need steady, reliable power. That’s what nuclear does best.

Susan Pendergrass (05:08)
Does it generate a lot of nuclear waste?

Avery Frank (05:15)
In the U.S. we use a once-through cycle. We refine uranium, put it in a plant, then seal it up forever. Other countries like France and Japan recycle their fuel. About 96% of spent fuel is still reusable, but the U.S. stopped recycling in the 1970s. If we restarted, we could reduce waste significantly, which already isn’t that large to begin with.

Susan Pendergrass (06:09)
So what could Missouri be doing right now to take advantage of this moment?

Avery Frank (06:32)
Timing is key. Missouri already has advantages: intellectual capital, infrastructure, the Missouri University Research Reactor, and Missouri S&T producing top nuclear engineers. We also have retiring coal plants that could be retrofitted into advanced nuclear plants, cutting costs by up to 35%.

Federal reforms like the ADVANCE Act are making things easier, but Missouri could act too. For example, we could form a Nuclear Advisory Council, like Tennessee did, to identify strengths and weaknesses and make recommendations. That’s attracted significant investment there.

Susan Pendergrass (08:14)
What about public-private partnerships?

Avery Frank (08:37)
That’s a great point. We believe the free market can play a big role, just like it did in space travel. One idea is Consumer Regulated Electricity (CRE), where private developers build small modular reactors for large customers like data centers on their own dime, outside the regulated grid. That takes the burden off ratepayers while meeting rising demand.

Susan Pendergrass (10:26)
Because I assume energy demand forecasts keep being revised up, right?

Avery Frank (11:03)
Exactly, and they’re hard to predict. What if AI suddenly uses less power? Then Missouri could be stuck with excess nuclear capacity. Letting the free market take some of that risk makes sense.

Susan Pendergrass (11:39)
What about the last Missouri legislative session?

Avery Frank (12:06)
Senate Bill 4 passed. It was a big utility bill that allowed “construction work in progress,” meaning utilities can charge ratepayers during construction, not just when a plant comes online. It’s unclear if it applies to nuclear, but it could. I’ve suggested treating it more like a bond, so consumers who shoulder the risk also see some reward, like lower rates or refunds.

Susan Pendergrass (13:44)
Any other signs that Missouri welcomes nuclear investment?

Avery Frank (13:47)
Yes. I attended the Missouri Nuclear Energy Summit in Columbia. Governor Kehoe was there and said we need to develop nuclear at business speed, not bureaucratic speed. That shows real resolve. Legislators are supportive too. Missouri has the advantages and infrastructure—we just need the right regulatory environment.

If Missouri created a Nuclear Advisory Council, like Tennessee, it could attract significant investment and expertise. Energy availability is now one of the top factors for companies deciding where to locate. If Missouri can offer abundant, reliable, clean energy, we’ll be far more competitive.

Susan Pendergrass (16:20)
That’s awesome. You have a paper out on this, available at showmeinstitute.org. Thanks for coming on and explaining it to us.

Avery Frank (16:32)
Awesome, thank you for the interview, Susan.

Produced by Show-Me Opportunity

The post Missouri’s Nuclear Opportunity with Avery Frank appeared first on Show-Me Institute.

The slow road to recovery is illustrated in the recently released preliminary results of the 2025 Missouri Assessment Program (MAP). The most recent data indicate modest improvements in mathematics, and average scores in at least some grades that are finally eclipsing pre-pandemic levels. However, the state’s stagnant reading scores continue to be a source of concern, as reading scores remain below their pre-pandemic levels in all tested grades.

Figure 1 summarizes MAP trends in the Show-Me State, including preliminary scores from the 2024–2025 school year:

Figure 1: Missouri Assessment Program (MAP) English/Language Arts Mean Scale Scores by Grade Level, 2018–2025

Source: Missouri Department of Elementary and Secondary Education

In Figure 1, the mean scale scores represent the student body’s performance as a whole. There are several important takeaways from this figure:

• Across all grades, Missouri’s reading scores have yet to return to pre-pandemic levels.
• Except for scores in the 3rd and 5th grades, reading scores are lower now than they were in 2020–21, when the pandemic was still strongly affecting in-person schooling.

Clearly, there is still work to be done.

Potential Solutions

This post is not meant to be doom and gloom—there is hope. States such as Indiana, Mississippi, Louisiana, and Tennessee have shown that student literacy can improve substantially with the right reforms.

These states have adopted early literacy policies that are effective, though sometimes unpopular: mandatory third-grade retention, eliminating three-cueing for teaching reading, and ensuring teacher preparation programs teach evidence-based reading practices.

Other states have proved that early literacy reforms can work. The 2026 legislative session is an opportunity to take meaningful steps toward improving educational outcomes in Missouri by taking reading reform more seriously.

The post Missouri’s Stagnant Reading Scores appeared first on Show-Me Institute.

Dr. Cory Koedel, the Show-Me Institute’s new director of education policy, joins Susan Pendergrass to discuss the biggest challenges facing Missouri’s public education system. They cover declining student outcomes, the role of accountability and testing, and the promise of school choice. Koedel shares insights from his research on school funding models—highlighting Tennessee’s student-centered formula—and breaks down what Missouri can learn from states that are improving early literacy. They also examine controversial policies like early grade retention and open enrollment, and Koedel outlines his priorities for education research in Missouri.

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Timestamps:

00:00 Introduction to Education Policy Challenges in Missouri
03:10 The Role of School Choice in Improving Outcomes
05:48 Funding Formulas and Their Implications
08:52 Early Literacy and Reading Instruction
12:05 Retention Policies and Their Effectiveness
15:04 Open Enrollment and Its Impact on Rural Schools
17:58 Future Directions for Education Policy in Missouri

Produced by Show-Me Opportunity

The post A New Voice for Accountability, and School Choice in Missouri with Cory Koedel appeared first on Show-Me Institute.

In the political realm, Tennessee has a strong track record of crossing the finish line, such as reducing the individual income tax to zero. Now, the state is adding to its policy trophy case with a new statewide school voucher program that will open doors for students across the Volunteer State.

Under the Education Freedom Act of 2025, Tennessee will offer 20,000 vouchers worth $7,296 each in taxpayer funds to help students statewide attend state-accredited private schools. The vouchers are first reserved for families with incomes 300% below the income limit to qualify for free or reduced-price lunch. The remaining scholarships have no income restrictions. This is a major step forward in expanding educational choice for Tennessee families.

Families (and even individual children within a family) have different needs. Education options should reflect that reality, and private schools are not a feasible choice for many families without financial assistance. EdChoice recently released a 2024 survey comparing educational preferences to actual enrollment numbers.

In Figure 1, parents were asked where their children are currently enrolled (the bottom bar), and then were asked where they would enroll them if they could select any type of school (the top bar).

Missouri’s actual enrollment numbers are nearly identical to actual percentages shown in Figure 1. But what is Missouri doing to allow families to meet their preferences? Tennessee saw what families wanted and took action; Missouri should follow this formula.

Governor Lee of Tennessee, much like Governor Kehoe in his recent address, placed a high priority on school choice reform. And much like Missouri, Tennessee faced strong opposition to breaking up the status quo—but leaders remained determined and got it done.

Missouri has come up short in many instances. Charter schools exist in our state, but are extremely limited. Our own ESA program helps some families, but lacks necessary public funding. Open enrollment has made it through the House four years in a row only to stall in the Senate.

If Missouri wants to build momentum and deliver education reform, determination will be key. The plays are drawn up, the end zone is in sight—we just have to get across the goal line.

The post Will Missouri Follow Tennessee’s Example? appeared first on Show-Me Institute.

Positive trends in regulation, attitudes toward nuclear power, and technology have fueled a resurgence in American nuclear power. The good news for Missouri: our state has a strong history with nuclear power and engineering. With real national momentum, Missouri has an opportunity to leverage our existing strengths to benefit from this resurgence.

A Simple First Step: Forming a Nuclear Advisory Council

A straightforward step would be forming a Missouri Nuclear Advisory Council to inform comprehensive strategies for guiding nuclear development. Tennessee’s recent experience offers a replicable model.

In 2023, Governor Bill Lee of Tennessee established a nuclear advisory council through executive order to inform legislative actions for addressing regulatory, education, and workforce barriers, as well as strategies for financing, waste storage practices, and opportunities Tennessee should pursue with federal partners and agencies. For example, the council recommended amending a regulatory statute to classify nuclear energy production facilities as Certified Green Energy Production Facilities, leveling the playing field with renewables.

Tennessee’s council serves as a model of collaboration and expertise, with membership that includes:

• Directors of interested state departments: Environment and Conservation, Economic Development, and Emergency Management
• Officials from the state legislature, congressional delegation, and local government
• Experts from higher education, utilities, workforce development, the energy production sector, and the nuclear industry
• Representation from the regional national laboratory
• Additional members as determined necessary by the governor (Tennessee opted to include more experts and scientists).

Missouri could create a similar council through executive order, establishing a platform for collaboration among the state’s brightest minds.

Potential Focus Areas for the Council

While Tennessee’s council had a partial focus on economic development, Missouri’s council could prioritize identifying best practices and potential legislative solutions without interfering in market outcomes.

To provide one example, the council could identify and evaluate suitable locations for new advanced nuclear facilities. The U.S. Department of Energy reports that repurposing coal plants for advanced nuclear reactors can reduce construction costs by up to 35%. Oak Ridge National Laboratory has already identified retired and retiring coal plants in Missouri as promising sites for new reactors. The council could assess these opportunities and recommend actionable steps.

The Potential for Missouri

Missouri has the talent, the track record, and the need to build new, advanced nuclear facilities. A nuclear advisory council could bring these elements together to inform best practices for new nuclear development in our state, catalyzing investment, attracting high-paying jobs, and securing a reliable energy supply for decades.

The post Forming a Missouri Nuclear Advisory Council appeared first on Show-Me Institute.

There are two key factors to consider when answering this question: academic promotion and social promotion.

• Academic promotion is straightforward—as students gain an understanding of the material, they advance to the next level and build on what they learned in the grade before.
• Social promotion is based on age and allows students to stay with their friends and peers throughout their school experience.

Social promotion largely wins the day in schools. On the National Assessment of Educational Progress (NAEP), 40 percent of Missouri 4th graders scored below basic on the 4^th-grade reading assessment in 2022. Additionally, 15.1 percent of the same 4th graders scored below basic on the Missouri Assessment Program (MAP).

However, recently, some states have put more emphasis on academic promotion.

Some States Are Focusing More on Academic Promotion

In states such as Mississippi, Tennessee, and Florida, 3rd grade students can be prevented from advancing to 4th grade if they do not meet reading requirements. This is typically referred to as a “third-grade retention policy.”

All three states have seen significant gains in reading achievement. Mississippi’s commitment to mandatory phonics instruction and 3rd-grade retention has contributed to such a large boost in reading scores, it has been referred by many as the “Mississippi Miracle.”

On the NAEP, Mississippi’s scores increased by almost 10 percentage points between 2013 and 2022. Missouri’s decreased by 6 percentage points over that time period.

Mississippi also implemented targeted reading instruction based on evidence-based reading. It is hard to disconnect 3rd-grade retention from intentional instruction.

Considerations for Weighing a 3rd-Grade Retention Policy

After the pandemic, reading scores in Missouri not only initially nosedived, but they sadly continued to decrease and remained low. Missouri may need to consider new strategies to help our students in need.

However, social promotion is not unimportant. For students who are trying hard and get left behind, this can be a very tough social situation. Having friends go on to the next grade means the student left behind has less interaction with friends—different classes, different sports teams, different lunch schedules, and more.

Additionally, kids being older than their peers can create awkward social situations and increase bullying.

Mississippi’s policy attempts to balance different priorities when considering retention. It has the :

• Limited English proficient students who had less than 2 years of instruction in an English Language Learner program.
• Students with disabilities whose Individualized Education Program (IEP) indicates that participation in statewide assessment programs is not appropriate.
• Students with disabilities who demonstrate a reading deficiency but whose IEP has provided them with intensive reading remediation for more than two years.
• Students with disabilities who demonstrate a reading deficiency but were previously retained in a K-3 grade.
• Students who meet an acceptable level of reading proficiency on an alternative standardized assessment approved by the Mississippi State Board of Education.
• Students who demonstrate a reading deficiency despite having received two or more years of intensive reading intervention and have been retained in a K-3 grade for two years without meeting exceptional education criteria.

Third-grade retention has a demonstrated track record of success in other states, and it should be given consideration as Missouri students continue to struggle in reading.

The post Should Missouri Consider a 3rd-Grade Retention Policy? appeared first on Show-Me Institute.

In one moment, they counted him out, and in the next, they were amazed at his determination. I’m hoping for an epic comeback story like this in Missouri public schools. Our scores faded badly following the COVID-19 pandemic. And sadly, with the recent release of the preliminary 2023–2024 Missouri Assessment Program (MAP) results, it is fair to say we are not running past everyone yet.

One state board of education member stated she was “a little deflated that we didn’t see more growth and progress.” I agree that the results were a little disappointing, so let’s delve into the specific statistics.

It is worth noting these are preliminary results for the 2023–2024 school year, so they could be subject to minor changes.

Overall, English/language arts (ELA) scores remained stagnant and math scores continued to gradually improve.

Figure 1: Missouri Assessment Program: ELA

Figure 2: Missouri Assessment Program: Math

After the pandemic, math scores fell more than ELA scores, but math scores have bounced back, and even surpassed pre-pandemic levels in some areas. Growth in math scores has been driven primarily by success in middle school mathematics, as 6th and 7th grade scores have surpassed pre-pandemic levels and 8th grade scores now match 2019 levels (not shown in Figure 2).

For elementary math, scores still remain below 2019 levels. Third grade scores have declined the most. 5th grade scores did not improve from 2023 and remain below pre-pandemic levels. There could be a need for greater focus in elementary instruction.

ELA scores continue to remain flat and far below pre-pandemic levels. They have actually dipped even further after the initial COVID drop. No grade-level cohort has exceeded its pre-pandemic levels, and only two cohorts (4th and 7th graders) improved from last year. Sixth graders have particularly struggled in ELA post-pandemic, as their pre-pandemic scores have declined more than any other grade level.

Missouri needs drastic action to help our students improve their ELA skills. A solid reading foundation is paramount for educational success, and we need to do everything in our power to catch our students up. Further commitment to the Missouri’s LETRS program (an evidence-based reading initiative) could yield results. Focus on evidence-based reading instruction has proven successful in other states such as South Carolina, Tennessee, and Mississippi. Those three states have also made phonics instruction mandatory. Reams and reams of research support evidence-based reading instruction.

Let’s dig deep and further commit to helping our students grow. I want to see a legendary comeback story.

The post Is There a Comeback Story in Missouri Schools? appeared first on Show-Me Institute.