Does Merger Make St. Louis a Strong Town?
Date Posted: February 18, 2019
Posted In: Discussion, Regionalism,
From NextSTL: No, on that I agree with Chuck Marohn and Kea Wilson (a St. Louis resident) of Strong Towns. However they were too quick on a recent podcast to dismiss the Better Together plan as tangential to the bigger issue supposing it focused on efficiency instead of productivity. Strong Towns stresses asking the right questions. Better question: Does the proposal make St. Louis stronger? Yes.
Strong Towns Podcast Upzoned – Can Cities Like St. Louis Get Financially Stronger by Merging with Richer Places?
Our fragmentation adds to the fragility of St. Louis. St. Louis City and County have about the same assessed value per unit land area. If you take out the farmland and forests in St. Louis County, they’re both about $50M per square mile. Each has its share of high and low-productivity places. There’s no cut-and-dry narrative of productive city taking on low-productivity suburbs here. Reducing fragmentation is not just about squeezing out efficiency to buy time. It is also about reducing the fragility fragmentation promotes.
Efficiency gains are important though. There are two ends to the Strong Towns scale- land productivity on one end and the level of infrastructure and services promised on the other. Our fragmentation makes it more expensive to deliver a given level of service than it otherwise has to be. In 2013 municipal courts in St. Louis City and County, from which data could be obtained, spent $15.8M. The city spent $2.23M. 15.8 – 2.23 x 4 = 6.9. The city of Dallas has budgeted $6.8M for FY18-19 for its muni courts. If the Metro City municipal court can do its job at the same per capita rate as St. Louis city (no economies of scale) it could be done for at least $6.9M less than under fragmentation. The Metro City is less house poor. It could put that towards making the muni courts more effective where lacking, the infrastructure maintenance backlog, paying down some other liability, not increasing taxes in the future, etc. In other words the less we spend on fragmentation, the more there is for infrastructure, schools, etc, thus less fragile.
Our fragmentation exacerbates the forces that encourage spread-out low-productivity development patterns that are tipping the scale towards insolvency. Our fragments don’t have the land productivity to meet their infrastructure and service promises. Changing their approach is hard. The seduction of the quick high of the retail development is enhanced by fragmentation. Developers leverage fragmentation for tax incentives. Tax increment financing (TIF) allows for using 100% of the property tax increment for the TIF and typically 50% of the sales tax increment. It’s a perfect storm- the development is all about the sales taxes which goes to the municipality while screwing the school district. We’ve set up a game where each city tries to shift taxable sales to within its borders. We’re left with more low-productivity land uses than otherwise would have come to be. Our municipalities are ever more dependent on taxable sales weakening the feedback mechanisms that used to promote building up, more intensely, and out. We’ve seen this movie play over and over again- right now in University City and Olivette.