I have not been shy about expressing my distaste for the current proposals being bandied about for upgrading the Edward Jones Dome. Today, the St. Louis Post-Dispatch published my letter expressing dismay at one of its columnist’s support for the Dome upgrade. Also today, the Post-Dispatch published a column by David Nicklaus echoing many of the same points I previously made.

Nicklaus cites an economic study conducted by Robert A. Baade and Victor A. Matheson which found that “Researchers who have gone back and looked at economic data for localities that have hosted mega-events, attracted new franchises, or built new sports facilities have almost invariably found little or no economic benefits from spectator sports.” This echoes the conclusions of the St. Louis Federal Reserve study that I cited. The economic case for upgrading the Dome simply is not there.

I also have to concur with Nicklaus regarding the public officials who are making the case for the Dome. If these officials are for the Dome, make the case in terms of civic pride or boosting the city’s image. Take that case to the people and let the chips fall where they may, but do not try to sell the plan to the public stating that upgrading the Dome will be an economic boost to the area, because it is not true.

The St. Louis Rams’ counter-offer to the St. Louis Convention & Visitors Commission (CVC) has just been released. You can read the proposal yourself, but the key take-away is that the estimated price for this upgrade is in the range of $500 million to $750 million, with $700 million as the more specific estimate. The breakdown between private and public money is unknown, but presumably the public portion will be substantial.  Also, the plan would involve making the Dome unfit for conventions for two years, due to renovation work. Needless to say, operators of hotels and restaurants in Saint Louis would not be thrilled with such an arrangement in the short term.

Before even discussing the merits of such a proposal, it is imperative to ask, where would the city, county, and state find the money to pay for this, even if they wanted to? The state had enough trouble balancing the budget for its current obligations. Saint Louis City is looking to reduce the size of the police force and Saint Louis County is laying off workers to balance its budget.

Also, would the public be better off with an investment of this sort? I already pointed out the conclusions of a St. Louis Federal Reserve study showing that the impact of public investments into sports stadiums was negligible, or in the case of Saint Louis, negative. In a book written by Roger G. Noll and Andrew Zimbalist, “Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums,” the authors conclude: “the economic case for publicly financed stadiums cannot credibly rest on the benefits to local business, as measured by jobs, income, and investment.”

If the Rams want a first-tier stadium, they should be free to build one with private funds, like the Carolina Panthers did. However, if they want the taxpayers to pay for most of it . . . then that is a problem. It is time to choose between what the city, county, and state need and what they would like to have.

The appropriators in Jefferson City have managed to finalize a budget before the May 11 deadline. The final version of the budget amounts to a little more than $24 billion. The key differences between the Missouri House and Senate budgets that held up the conference committee from crafting a final budget seem to have been resolved.

The most recent stumbling block involved funding for the Sue Shear Institute for Women in Public Life. The Institute’s goal is to help prepare women to run for public office. There is nothing wrong with that, but should taxpayers foot the bill? In economic times such as these, it should be a relatively easy call to cut funding for programs like this one. Apparently in Jefferson City, the call was not so easy. The Shear Institute gets to keep state funding. This fracas is indicative of the problems that plague Jefferson City.

If deciding on whether to cut funding for a non-essential program like the Shear Institute can cause the budgeting process to screech to a halt, what would happen if something much bigger was on the table, such as tax credit reform? Organizations on the left and the right have called for tax credit reform, but yet there seems to be little movement to actually enact any meaningful reform (a reform, by the way, that, if enacted, would do a lot to alleviate the current budget situation in which the state finds itself).

The budget impasse has been resolved. However, this situation is indicative of the obstacles facing any reform measure that might be proposed.

Officials for the St. Louis Rams football team must submit their counter-proposal for upgrading the Edward Jones Dome to the St. Louis Convention & Visitors Commission (CVC) by tomorrow. It will be interesting to see the Rams’ proposal; however, CVC officials will not release the plan — unless the Rams give them permission (I would not bet on that).

This proposal is integral in determining whether the Rams stay or leave Saint Louis. But what really matters is that the CVC will not let the public review the proposal, which if accepted, could cost the taxpayers millions on top of the $24 million per year that the state, city, and county already pay for the Dome’s construction. The Rams already rejected a proposal from the CVC that would have left the public on the hook for $60 million, so it is reasonable to guess that the public’s portion of the bill in the Rams’ counter-proposal will be much higher.

CVC officials maintain that they are complying with a provision in the lease with the Rams that some information can be kept confidential. However, considering that (a lot) of public money is potentially on the line with this deal, NO decision should be made until the public has a chance to review it.

The Show-Me Institute has a long record of opposing such government “investment.” However, even if the CVC accepts the Rams’ counter-proposal, it should do so only after the people who would actually pay for the project are allowed to see the costs.

It seems the appropriations process in the Missouri Senate had ground to a standstill before finally passing early Wednesday. What was the cause of the holdup? Apparently, a group of nine senators stalled debate on the budget. The senators argue that the budget fails to set aside enough money for unexpected expenses and that it is out of balance. They also claim that the budget relies on $200 million from one-time funding sources.

Given that Missouri Gov. Jay Nixon’s Executive Budget explicitly states that it is counting on a one-time tax amnesty to help plug the budget shortfall, it would seem that these senators’ grievances are well-grounded. As a general rule, any organization that has a budget should prepare for the worst and not count on rosy scenarios. Unfortunately, rosy scenarios seem to be the only game in town.

It is not hard to imagine WHY the state is relying on overly optimistic outlooks when it budgets. The Missouri Constitution mandates a balanced budget and thus revenue needs to be raised to match expenses or expenses need to be cut in order to match revenues. Neither option is attractive to legislators, thus, we have the current budget maneuvers.

One option to help deal with the budget, which seems to have support from both the left and the right, would be to rein in the explosion in state tax credit issuances. Every new issuance puts the state on the hook for another dollar and every tax credit redemption costs the state a dollar of revenue. The state needs to make serious changes in how it does business; tax credit reform would be a good start.

The St. Louis Post-Dispatch recently published an article lamenting the fact that Missouri has the nation’s lowest taxes on cigarettes. They are not alone; the Kansas City Star editorial that I wrote about on April 3 pushed for the state to raise the cigarette tax. The Post-Dispatch and Star articles differ on the reasons they want the cigarette tax increased;  however, does it occur to people that there might be negative consequences to raising the cigarette tax?

For instance, stores in Missouri that are on the border with other states attract business from people shopping here in order to take advantage of the state’s low excise taxes. Show-Me Institute intern Amy Lutz recently wrote an op-ed that details the impact such a tax hike could have on interstate commerce.

Also, an increased tax on cigarettes would disproportionately harm the poor. The Post-Dispatch article mentions that raising taxes is an effective method for getting people to quit smoking. Do increased cigarette taxes result in significantly fewer smokers? If smoking is bad for us, and it is OK to increase taxes on that, where does it end? What next, enormous taxes on sugar to finance heavy broccoli subsidies? What about an obesity tax? Isn’t there something offensive about government micromanaging our lives?

The future of the state’s beer market potentially is about to change, and not for the better. That is, if some legislators in Jefferson City get their way. The Missouri Senate is considering Senate Bill 876, in which the main provision states that no brewer, brewer employee, nor brewer affiliates “may have any financial interest in a beer wholesaler, or serve as a director, manager, employee, or agent of a beer wholesaler.”

There is an exception for small breweries (those that produce less than 10,000 barrels a year) owning wholesalers that sell only those breweries’ beers. My question is, why is the state interfering in beer distribution in the first place? Is there a great harm that the state needs to address? Is there anti-competitive behavior occurring? I have not seen an argument being made for this bill on its merits. However, I can see a potential negative. Middlemen, such as beer distributors, succeed when they add value to the process. Such middlemen can be important components of economic organization, but that is only if they add value to the process; state officials should not mandate them into existence.

While there are some legitimate roles for the government in regulating alcohol sales (i.e., age restrictions), the provision that would be created in this proposal is not one of them. If brewery officials do not think it is to their benefit to own or have a financial interest in wholesalers, they will make that decision. However, I do not see why the state should involve itself even more in the market with a mandate for the distribution system of a certain product. SB 876 is another example of the state meddling in areas that are best left to the market.

The Missouri House of Representatives recently voted (137-12) to create a new tax credit aimed at encouraging investment in start-up businesses. My colleague, Bruce Stahl recently wrote about this tax credit. Consider this fact, Missouri ALREADY issues hundreds of millions of dollars in economic development tax credits every year. Yet, Missouri is still one of the worst performing states in the nation economically. Do legislators in Jefferson City really think that this tax credit is somehow different than all of the other economic development tax credits already implemented?

The Show-Me Institute has presented several ideas that would help Missouri jump-start its economy. Shouldn’t the state take a serious look at alternatives before adding another drain on the state’s revenue?

The Kansas City Star wrote an op-ed urging Missouri Gov. Jay Nixon (D) to expend some of his political capital in order to bring in more revenue to fund state programs. The Star states that lawmakers in Jefferson City should stop bickering about which programs to cut (they specifically mention the current fight about cutting funds from higher education or funding for a medical program for the blind) and focus on finding new sources of revenue. They specifically mention reigning in tax credits and raising the tax on cigarettes.

Why are tax hikes even on the table? Legislators have not even cut all waste and low-priority programs from the state budget, never mind bigger ticket items such as higher education and medical programs for the blind. Considering that the Missouri House passed an appropriations bill that includes funding for the Missouri Wine & Grape Board along with ethanol subsidies (and that is only for the Department of Agriculture), the state has plenty of places to cut.

The Star editorial is not all bad. It does call for reigning in tax credits, which the Show-Me Institute has pushed for repeatedly. However, it also calls on raising the cigarette tax. The Show-Me Institute has written on this issue and the situation is the same now as it was then; raising taxes on cigarettes is not the cure for what ails Missouri.

Missouri needs a healthy environment so its economy can thrive. That does not just mean low taxes; it also means lowering regulatory burdens. Doing so will ensure that the state receives enough revenue so that all PROPER functions of government have enough funding to work effectively.

Should a private country club, even one with a rich golf history, be subsidized by taxpayers? Show-Me Institute Policy Researcher Michael Rathbone takes a look at Norwood Hills Country Club in Saint Louis County.

In January, Missouri Gov. Jay Nixon (D) launched his opening salvo in what was sure to be a contentious session between the governor and the General Assembly regarding the fiscal year 2013 budget. Last week, the Missouri House passed its version of the fiscal year 2013 budget. Both budgets reflect differing priorities and seemingly difficult choices.

If both the governor’s and legislature’s actions indicate anything, there is seemingly nothing else to cut in the budget and thus the state is faced with the Scylla of higher education cuts and the corresponding tuition increases they entail, or the Charybdis of cutting health programs, specifically a program for the blind who do not qualify for Medicaid. However, despite proposed cuts in these programs, there are still egregious examples of programs that clearly have no business being funded but still receive taxpayer dollars.

I have previously blogged about programs such as the Missouri Wine & Grape Board and Missouri ethanol subsidies. According to the House Budget, the Missouri Wine & Grape board receives an appropriation of $1,826,275 while the state will appropriate $9,850,000 to various ethanol and biodiesel programs. Before fighting about whether to cut higher education or programs for the blind, shouldn’t state officials eliminate funding for programs like the two mentioned above?

Major League Baseball’s Opening Day is approaching so let me start with a baseball analogy. In the Triple Crown of economic indicators (state Gross Domestic Product-GDP, state GDP per capita, and total employment), Missouri is nowhere close to being an All-Star. In fact, it is struggling to just stay in The Show.

In all three indicators, Missouri compares poorly to other states and the country. According to data from the Bureau of Economic Analysis (BEA) and the Bureau of Labor Statistics (BLS), Missouri under-performs when compared to the U.S. as a whole in all three categories. Missouri ranks 48th out of 50 states in state GDP growth, 45th in per-capita real GDP growth, and 45th in total employment growth. In fact, when one compares Missouri with the three best and three worst performing states for each indicator, Missouri’s performance nearly mirrors that of the bottom three states (and in the case of state GDP, Missouri IS one of the bottom three performing states). Missouri’s troubles also cannot be blamed on the most recent economic troubles. Over a period spanning from1997 to 2010, Missouri consistently under-performed the national average and was close to the bottom in all three indicators.

Considering how Missouri is ranked relative to the rest of the country, the question should be asked, “How about a new line-up?” The Show-Me Institute has conducted research on ways Missouri can improve its economic standing. Given Missouri’s current situation, how much worse can the state do if it considers implementing some of these suggestions?