September 12, 2014

Luxury-Oriented Development in Clayton

This week, Clayton proposed granting a 50 percent property tax abatement for 20 years to a $72 million luxury apartment development—The Crossing—in the heart of downtown Clayton, an area which the city council absurdly declared “blighted.” The city argues that the development will bring more economic activity and act as transit-oriented development.

We have written many times before that using tax incentives to lure development either generally diverts development from other areas or, worse, provides tax breaks to development that would have occurred anyway. These abatements put the pressure of funding local services on businesses or areas of the city that are not so favored by the city council. This type of central planning by tax policy creates an uneven playing field that is unfair and ultimately economically damaging. Allowing a luxury property developer and future residents to pay lower property tax rates, when rates were just increased for the rest of Clayton, is questionable policy.

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The Crossing

The argument that this development will boost transit ridership is also flawed. While changing zoning restrictions to allow less parking for a downtown building is not objectionable, using possible transit ridership to justify tax favoritism is bad policy. The relative affluence of Clayton has meant that local MetroLink ridership is far below what planners hoped for before the station opened in 2006. Original projections would have had the Clayton station serve 3,000 riders each weekday shortly after opening. Today, total ridership is 880 per weekday, and only 213 Clayton residents use the MetroLink to get to work. Four times that number walk.

The idea that luxury apartment dwellers will greatly boost this ridership is unlikely, because the affluent typically own vehicles and are much less likely to use transit than those with lower income. Even if all the residents of The Crossing did use public transportation, is it not enough that city, county, and federal government spent hundreds of millions building a light rail line to Clayton, and they continue to provide subsidized tickets that cover less than a third of that rail’s operating costs? Do we need to subsidize their luxury apartments next to the station as well?

Chances are some of the new residents will use transit, more will walk, and most will drive to their destinations. As for the local economy, the effects of diverting development and rearranging tax burdens will go unseen. But the good news is (for those with the means), new luxury apartments are coming on the market! And just wait until you see the location …

September 11, 2014

Streetcars Aren’t Good Economics or Transit

Back in October 2013, Kansas City Councilman Russ Johnson said that the whole point of streetcars was to spur economic development, not transportation. He was quoted by the Kansas City Business Journal:

“The stated goal of this project is economic development. That’s the dominant goal,” [Russ] Johnson said. “The dominant goal is not to have a lot of people ride it. The dominant goal is to develop the city.”

The Show-Me Institute has argued repeatedly, and apparently successfully, that streetcars do not contribute to economic development or provide reliable transit. More people are waking up to this fact.

CityLab, formerly The Atlantic Cities, just published a column titled, “Overall, U.S. Streetcars Just Aren’t Meeting the Standards of Good Transit,” and it is worth the read. The author offers the following:

  • The most commonly cited problem with new streetcars—Matt Yglesias calls it the “original sin“—is that they tend to run in mixed traffic alongside cars. The resulting slow speeds, combined with the relatively short length of the lines (often just a mile or two), means many potential riders could sooner reach their destination by foot.
  • Very few next-generation streetcar lines run with the sort of frequency that might counterbalance slow speeds or short distances.
  • As streetcar skepticism grows louder, even among traditional transit advocates, there’s some confusion about its source. Some mistake it for an anti-rail sentiment (a misperception perpetuated when critical pieces quote actual rail opponents, as the Economist recently did). In fact, the true spirit of the concern is not anti-rail or anti-transit but anti-bad rail transit.

These three items appeared in the most recent campaigns for a streetcar: they ran along commercial thoroughfares; they were to run slowly and infrequently; and opponents were accused of just being anti-transit. The CityLab piece saves the best part for last. The author concludes that the reason streetcars fail to meet standards of good transit is because of boosters like Johnson:

“[The problem is] the way too many new streetcars are being deployed—as economic engines first and mobility tools second (if at all), even after being constructed with painfully limited transportation funding—that’s inspiring much of the criticism.”

Not only were Johnson and others who promoted economic development wrong on the facts, but transit supporters also are beginning to realize that streetcars don’t even provide worthwhile transportation.

September 10, 2014

Are Outdated Projections Driving I-70 Rebuild Plans?

With the defeat of Amendment 7, the transportation sales tax, the issue of how to fund Missouri’s statewide road system remains up in the air. Part of the reason that the Missouri Department of Transportation (MoDOT) needs more money is to fund the rebuilding of I-70, a multibillion-dollar mega-project. However, it is possible that MoDOT’s plan to rebuild and expand I-70 is excessive and based upon erroneous projections of increasing traffic.

MoDOT has exposed the need to rebuild I-70 for years. Its oldest sections are more than 55 years old, and much of the highway requires rebuilding from the ground up. But MoDOT is not just looking to rebuild I-70, they are also planning to expand it. MoDOT’s preferred plan would replace the pavement, expand the highway to at least three lanes on each side, construct a wide median, and replace interchanges. The plan is estimated to cost $3 billion. If Amendment 7 had passed, more than $1 billion (a quarter of all sales tax dollars going to the state road system) would have gone to improve I-70. Of that, $500 million would have gone to expanding the highway to three lanes from Wentzville to Independence.

MoDOT is so concerned with expanding I-70 because they projected traffic would almost double from 2007 to 2030. If I-70 does not add lanes, it would mean stop-and-go traffic across the state. Here is a chart of MoDOT’s projections:

1

MoDOT expected average daily traffic to increase roughly 2.5 percent per year from 2007 to 2030. If the growth in I-70 traffic follows the trend above, MoDOT is more than justified in its drive for more lanes. However, these increases are failing to materialize. For instance, in 2013, traffic should have been around 16 percent higher than it was in 2007. However, at most points along I-70, traffic was down. And lest one think this is a trend of the recession, 2007 traffic was around the same as 2000 traffic.

2

The idea that people are driving less, or at least not driving much more, should not surprise MoDOT. After all, they repeatedly say just that when requesting more dollars to spend on expanding rail and transit projects. If traffic on I-70 is not growing much now, and MoDOT expects people to drive less in the future, why hasn’t MoDOT updated its projections and plans for I-70? Claiming to need more money because people are driving less, while simultaneously needing money to handle traffic growth, seems like trying to have it both ways.

A more economical solution to the I-70 problem may be to rebuild the two-lane structure while addressing bottlenecks around places like Columbia. That might fit the needs of Missourians, while lessening some of MoDOT’s financial strain.

Common Core Doesn’t Put the CCSS in Success

success

In previous posts on the Common Core State Standards (CCSS), I’ve written about the consequences of federal overreach, which, in itself, is a strong argument against the nationally imposed standards. Unfortunately, this argument is unconvincing for teachers, who have been led to believe these standards will give them more instructional flexibility and ultimately will help students make academic gains.

The following two quotes about CCSS reflect these widely held beliefs.

They are not a curriculum; it’s up to school districts to choose curricula that comply with the standards.
—Kathleen Porter-Magee and Sol Stern

Not exactly. Though it’s true that Common Core is just a set of standards, curriculum is informed by assessment. If the assessment is Common Core, the curriculum is Common Core. School districts buy curriculum sets (textbooks, workbooks, reading materials, etc.) that reflect the standards and prepare students for assessments. This ultimately gives teachers less instructional flexibility.

The promise of these high standards for all students is extraordinary.
—Former NEA President Dennis Van Roekel

If only. As a teacher, I would have loved to set the same high bar for ALL of my students. But the truth is, not every student has the same readiness for learning. Last year, one of my 13-year-old students scored a 30 on the ACT. Would I set the same high bar for this student and a student who had just tested at a fourth-grade reading level? No, I would differentiate instruction, meaning I would assign a project with varying degrees of difficulty and interest-based learning.

The problem is not “setting the bar high enough,” it’s the challenge of scaffolding instruction to fill in the gaps where there is missed learning. Sure, setting a high bar for every child sounds great, but without instructional flexibility, how will teachers make decisions that best suit the needs of their students?

They won’t. Even if setting a high bar for all students did increase academic achievement, there is still some debate about whether the Common Core even does that. If Missouri really wants to see students make academic gains, we should trust teachers to do their job well, and reward the ones that do.

 

September 9, 2014

Ditch the Tax Incentives and Pursue General Tax Cuts Next Year

The Missouri Legislature’s 2014 veto session begins this week, and the chambers are set to reconsider dozens of bills rejected by the governor earlier this summer. While a handful appear to have enough support for an override, most sit in legislative limbo, fates to be determined. Among those bills hanging in the balance are a package of tax incentives I’ve talked about many times before.

These incentives are bad policy in general, but to create these handouts well outside of the legislature’s normal budgeting protocol is inexcusable. The budget must balance, and this late-breaking special interest goody bag throws the state’s budget out the window. Missourians deserve better than to be treated like a cash spigot for the well-connected.

There’s also a larger picture that needs to be understood here. Some of the most vocal tax cutters are also big boosters of tax incentives, but by creating, expanding, and sustaining tax handouts like these, our state is making the enactment of future tax cuts much more difficult. We should all be paying for the cost of our government, but increasingly, well-connected special interests are being exempted from that burden. That’s wrongheaded policy. As a general rule, if taxes are going to fall for anyone, they should fall for everyone. It’s time to kick the tax incentive circus out of Jefferson City.

The legislature should come back next year and pass broad and responsible tax cuts for Missourians. The first step is rejecting this year’s incentives.

September 7, 2014

Saint Louis Needs Better Bus Rapid Transit Plans

In a previous post, we outlined how Metro is planning to introduce Bus Rapid Transit (BRT) in the Saint Louis region, and how they may waste millions on a low-ridership route that follows I-64 between downtown and Chesterfield. In this post, we turn our attention to Metro’s ridership estimates for these BRT plans.

Metro expects the I-64 BRT to have 5,100 weekday riders to start, 2,100 of which will be new “choice riders.” Another possible BRT route, one that follows Natural Bridge and Florissant, could carry 3,200 riders. Metro used a regional travel demand model to come up with these estimates. And while models can be very useful, the real-world performances of Metro’s Express Buses show no such underlying demand, especially in West Saint Louis County.

Metro operates six Express Bus lines in Missouri, which are designed to handle weekday rush hour traffic to and from downtown. They have routes that follow the region’s major highways between downtown and the county, with fewer stops than normal buses.

brtx

As the map above demonstrates, only the proposed Page Avenue BRT does not have an Express Bus currently running a very similar route.

Unfortunately, these express routes are not popular. In fact, they are a regular who’s who list of the emptiest, worst financially performing bus routes that Metro has to offer. The best performing Express Bus by far is the 36X, which carries a mere 563 passengers per day and loses more than two dollars per passenger. Anyone who has read our previous posts on the MetroBus system will not be surprised to hear that the highest ridership is on a route that serves North Saint Louis City and County. The 57X, which runs along most of the proposed I-64 BRT route, has 257 passengers per day and loses more than nine dollars per passenger. By way of comparison, the average MetroBus route carries 897 passengers per day and loses $3.22 per passenger. A full table on Express Bus performance is below:

Line Average Passenger Boarding Count Per Day Farebox Recovery Ratio Loss Per Passenger
36X Bissell Hills Express 563 32% ($2.31)
174X Halls Ferry Express 255 16% ($5.56)
40X I-55 Express 178 11% ($8.68)
57X Clayton Rd 257 10% ($9.45)
410X Eureka Express 187 8% ($11.89)
58X Twin Oaks Express 155 8% ($12.91)
MetroBus Average 897 25% ($3.22)

Express Buses are not BRT. They do not have the higher level of comfort, signal priority systems, dedicated lanes, or sheltered stops that BRT provides. However, they do provide reasonably fast service along major highway corridors between downtown and the county. In that way they likely portend future demand for BRT routes running very similar routes. And the prediction for an I-64 BRT route is not good.

September 6, 2014

St. Louis County: Does It Have Too Many Municipalities

Many municipalities in Saint Louis County, large and small, rely on fines that harm their populations to fund local government. This week, the Washington Post published a story illuminating how clusters of small municipalities, each attempting to fund their governments through citations, turn parts of the county into a minefield for cash-strapped residents.

Saint Louis County contains 90 municipalities, some with less than 1,000 residents. Many of the smaller municipalities are in North Saint Louis County and rely heavily on traffic tickets and court fees. For example, Beverly Hills (population of 571) issued more than 3,000 tickets and collect more than $200,000 in court fees last year. Charlack, a small city in North Saint Louis County (population 1,362), derives 29 percent of its revenue through traffic fines alone. By contrast, most cities in Missouri receive less than 5 percent of their revenue from fines and fees.

speedtrap

But size is not everything. As the Post article points out, even the larger municipalities in North Saint Louis County are guilty of issuing numerous citations. Florissant (population 52,000) issued almost 30,000 traffic tickets for more than $3 million in fines last year, accounting for 13 percent of its revenue. Saint Ann, notorious for its I-70 speed trap, expects that 36 percent of its revenue ($3.3 million) will come from fines and court fees in 2014.

Furthermore, small Saint Louis County municipalities do not all rely so heavily on fines. For instance, Grantwood Village (population 863) only issues around 120 traffic tickets a year. In 2012, it collected only $34,000 in fines and fees. Black Jack, a small municipality in North Saint Louis County (population 6,920), receives less than 5 percent of its revenue from fines. What do Grantwood Village and Black Jack have in common? They both contract out police from Saint Louis County and do not operate their own police departments.

A combination of necessity and opportunity likely drives cities, large and small, to pursue aggressive citation policies: the necessity arising from a dearth of other funding sources, the opportunity from having a piece of Missouri’s highway system.

Fining residents to generate revenue, instead of promoting public order, is not the way to achieve good governance in Saint Louis County. In future blog posts, we will discuss these problems further and explore ways residents and policymakers can reform local governments.

September 5, 2014

Charity Is Not Your Strong Suit, Francis Howell

 Annual Performance Report

On Wednesday, Elisa Crouch and Jessica Bock of the St. Louis Post-Dispatch reported that Francis Howell will allow transfer students from the Normandy School District to return. That is, if those students take legal action and force the school district to comply with the law.

The Francis Howell School District will continue to require court orders for students from Normandy who want to transfer, said Jennifer Henry, district spokeswoman. The district sent a letter today to parents to inform them that it was possible 350 students could be returning, but that it was unclear how many would take legal action. 

So far, 17 transfer students have returned to Francis Howell through court orders. 

Henry said district leaders continue to believe that the transfer situation depletes the resources for the larger student population who remain in the school district.

The district claims it is not accepting all of the students, as other school districts have done, because they are concerned about draining resources from the unaccredited Normandy School District. This is simply taking a faux moral high ground.

Francis Howell is a great district. They have great teachers, administrators, resources, and students. Because of the large size of the district, roughly 17,000 students, it easily can accommodate an influx of 350 to 400 students in need of better educational opportunities. And, as we just found out, student achievement in the district was not negatively impacted by the influx of Normandy students.

If Francis Howell really wanted to take the high ground, they would open their doors to students desperate for a quality education and they would lower their tuition rate. Even with a lower tuition rate, the district could still see a financial windfall. If they did that, they would be showing true compassion for the students who want to transfer and the students who do not.

Forcing students to sue in order to obtain their spot that they are promised by state law in order to save Normandy money is not charitable, it is poor form and simply bad policy.

September 4, 2014

Is the Super Bowl a Super Boost for Local Economies?

The Kansas City Star published an article reporting on the creation of a task force whose goal is to bring the Super Bowl into Kansas City. My colleague Patrick Tuohey did a great job explaining how claims of large economic impacts to Super Bowl host cities have been overstated. However, there is more to the story than just saying the economic impact of a Super Bowl is overstated.

Does the Super Bowl have any positive net economic impact on a host city?

The answer is it can, but it probably won’t. In a 2009 study, Michael C. Davis and Christian M. End found that hosting a Super Bowl has no economic impact on a city’s real per capita income, and in some cases it can have a negative effect. Robert A. Baade, Robert Baumann, and Victor Matheson examined the economic impact of mega-events (including the Super Bowl) in Southern Florida from 1980 to 2005. During that period, three cities (Tampa Bay, Miami, and Jacksonville) hosted the Super Bowl a total of seven times. The Super Bowl had a statistically significant positive impact on the city’s economy in only one instance (Tampa in 2001). Dennis Coates found that Houston saw increased sales tax revenue because of the Super Bowl in 2004. But the next year in Jacksonville, the Super Bowl was found not to have had an economic impact.

This takes us back to the Kansas City Super Bowl task force. Why is the state in the business of trying to lure the Super Bowl to Kansas City? Couldn’t a private group of interested residents and businesses sell the city as a Super Bowl destination just as well? Possibly, but the state can offer the NFL subsidies. However, just because the state can do something, doesn’t mean it should. Economists in general oppose sports subsidies because, “The large and growing peer-reviewed economics literature on the economic impacts of stadiums, arenas, sports franchises, and sport mega-events has consistently found no substantial evidence of increased jobs, incomes, or tax revenues for a community associated with any of these things.”

It’s true that there could be intangible benefits to hosting a Super Bowl, like increased exposure to the outside world. Yet, is there any concrete measure on what kind of return the city would see from such exposure? Will businesses or residents move to Kansas City because it hosted the Super Bowl? I don’t know, and the burden of proof should be on those arguing for government subsidies.

Kansas City is a great football town, and I agree with Joe Clifford when he says, “The Super Bowl’s tremendous.” However, I don’t think the residents of Kansas City nor the rest of Missouri should pay for the privilege.

 

 

September 3, 2014

The Score Is Falling! The Score Is Falling!—Or Not

When it was announced that hundreds of students would transfer from the unaccredited school districts of Normandy and Riverview Gardens to higher-performing districts, receiving communities had a few concerns. One of these concerns was that transfer students would negatively affect their school’s standardized test scores.

Young families hunting for a house often use standardized test rankings as a tool to select a neighborhood. This is highly evident in the Lindbergh School District, where, aside from its relatively low tax rates and housing turnover, the district’s rising enrollment has been attributed to its top-ranking achievement record.

Data released from the Missouri Department of Elementary and Secondary Education (DESE) reveals the (receiving district MAP score) concerns were unfounded. In fact, receiving school districts saw little to no decrease in test scores in comparison to the previous year without transfer students. An analysis by St. Louis Public Radio shows that transfer students had no effect on the Annual Performance Report (APR) of many receiving districts.

Some districts did see a change in APR score, and this could be explained by a number of variables. For instance, the state itself saw a decline in scores overall. Also, standardized test scores are strongly correlated to the socio-economic makeup of a district. This may explain why Ferguson-Florissant, a low-income receiving district, saw the most decline—3.6 percentage points.

The transfer of 2,200 students did not cause the sky to fall—or scores for that matter. What it did was give students an educational opportunity. For the receiving district that has chosen not to accept transfer students, this should be a sign that it’s time to take those 350 children back.

Transfer students may not have made a difference on receiving districts’ APR scores, but the receiving districts certainly made a difference on transfer students.

Henny_penny

 

September 2, 2014

Make Bus Rapid Transit Serve Bus Users

Bus Rapid Transit (BRT) is likely to make its debut in Saint Louis in the next couple years. Regional planning agencies are narrowing down the list of potential candidates, and MoDOT is preparing to spend more than $10 million constructing the service from 2015 to 2016. Unfortunately, the prime candidate for the first BRT route in Saint Louis is likely to be a wasteful route to West Saint Louis County.

In the Saint Louis area, the vast majority of transit (and bus) usage is in areas with low income, low vehicle ownership rates, and high population densities. Virtually all busy bus routes in the Saint Louis area are concentrated in the city (mostly in North Saint Louis City) and North Saint Louis County. Conversely, most bus routes that serve West and South Saint Louis County (where vehicle ownership and incomes are higher) see little ridership. Many of those routes lose more than five dollars for every passenger that steps on board. For instance, the 158 Ballas-West County route, which currently serves what would be the western half of the I-64 BRT route, has a fare box recovery ratio of 6.6 percent, meaning it loses a staggering $15 per passenger.

Despite these facts, the prime choice for a $42 million BRT route is one serving West County, going from downtown to Chesterfield along I-64. Planners prefer this route as it connects area workplaces and (they hope) can draw new “choice” transit ridership. However, if demand for current transit is any guide, ridership is likely to be low, especially because end-to-end travel time is only being cut from 76 minutes to 53 minutes. With the same trip taking less than half the time by car (and the vast majority of people living around the proposed line own cars), that’s unlikely to get many people out of their personal vehicles.

fourbrt2

 

A second finalist for BRT is a route along Natural Bridge and West Florissant. As the map above shows, that route would travel through areas with high public transportation usage (high FBR) and low rates of car ownership. It would be very likely to have high ridership and greatly improve the mobility of local residents. It is far superior to an I-64 BRT, as are both the Halls Ferry and Page Avenue routes (both of which failed to make the final selection).

If Saint Louis can only implement one BRT route in the next five years, the Natural Bridge and West Florissant route is likely to have the highest ridership and best service for those who need transit. Even if they go forward with more than one BRT route, the I-64 option likely would waste tens of millions in a futile attempt to chase choice ridership, and planners would do better to choose another route that serves Saint Louis City or North Saint Louis County.

August 31, 2014

Tolling I-70: A Semi-Solution to MoDOT’s Funding Problems

With the defeat of Amendment 7, officials are looking for ways to fund Missouri’s highway system. MoDOT needs adequate funding, not only to maintain existing highways, but also to fund future multibillion-dollar projects, principal among these is the reconstruction of I-70. One possible solution is to introduce tolls on I-70, which would allow those who benefit from the highway to pay for its improvement.

Those who directly benefit from I-70 are drivers, especially from companies that own commercial vehicles (interstate trucks). According to MoDOT, at least 25 percent of the traffic on I-70 is attributable to commercial vehicles (more than two axles). These vehicles also make up much of I-70’s cross-state traffic, with 70 percent of commercial vehicles passing straight through Missouri. If the state would toll I-70, both passenger and commercial vehicles would pay to use the interstate based on their size and distance traveled. In other states, commercial vehicles typically pay four to five times more than passenger vehicles. They pay extra to compensate for the extra damage they cause to the roadway. In fact, toll roads in other states generate much, if not most, of their revenue from commercial vehicles.

 

Toll Road System commercial vehicles as   a % of total vehicles % miles on road from commercial vehicles % of toll revenue from commercial vehicles
Ohio Turnpike 21.00% 33.10% 55.69%
New York Thruway 11.02% 15.59% 47.10%
Pennsylvania Turnpike 12.88% 20.30% 42.62%
Oklahoma Turnpike 8.72% 18.18% 38.86%
Kansas Turnpike 11.60% 17.80% 36.88%
Illinois Tollway 11.71% - 34.01%
North Texas Tollway System 1.87% - 22.39%
Florida Turnpike System 3.95% 5.06% 19.12%

 

If Missourians decide to rebuild I-70 using toll revenue, it is likely that much, or even most, of that revenue would come from commercial vehicles. That’s a fair solution, because commercial trucking entities cause the most wear on highways and benefit the most from good roads. In fact, a well-maintained highway saves trucking companies money, because it reduces delays and vehicle damage. The failure of Amendment 7 doesn’t mean that Missourians want bad roads; it means they want good roads paid for in a sensible way. A sound tolling solution would allow drivers and interstate truckers alike to invest in the highway from which they so benefit.

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