By Caitlin Hartsell and Audrey Spalding
The Show-Me Institute

An earlier published version of this story inadvertently misstated the Board of Aldermen’s final vote on the project. That error has been corrected below, and we apologize for the oversight.

The Saint Louis Board of Aldermen voted to perfect and approve an $8.1 billion development of the city’s north side, along with $198.6 million in tax increment financing (TIF) for the first half of project, for the next 23 years. The second portion of TIF money, $192 million, will be considered by the city at a later date, in order to conform to the development company’s project schedule. Only a dozen people were in the viewing balcony to hear the vote.

Alderwoman April Ford-Griffin of the 5th ward delivered the perfection motion for adoption of the redevelopment project and general development for the TIF. In her statement, she addressed previous community concerns about the project and reaffirmed her belief that the proposal was in the best interest of the city and its residents.

“There is no eminent domain. There is no city guarantee [of the TIF monies] and there are no exclusive rights [to redevelopment].”

Alderman Ford-Griffin emphasized the importance of multiple developers throughout her statement. Northside Regeneration LLC, represented by developer Paul McKee and his development company, McEagle, would be prohibited from developing more than 75 percent of the area.

Alderman Antonio French of the 21st ward raised the only opposition opinion at the meeting. He voted against  final passage of the bills.  At an earlier committee hearing of the project, Alderman Terry Kennedy of the 18th ward voted against the project.  At the Friday meeting, French brought up concerns about the message the vote would send to other developers aggressively buying land, specifically noting Urban Assets LLC.

“I think we should send a message to future developers buying in my ward and others that this is not the proper way to go about this,” he said. “The way it has been done is not the way it will be done in the 21st ward.”

McKee and McEagle began considering the north side project in earnest in 1998, said McEagle Chief Development Officer William Laskowsky in an earlier interview.

“We’re projecting 15-year build-outs in our models. We wouldn’t want to start C and D and lose 10 years due to inactivity. So that was an effort to preserve the timeline on the TIF.”

At the Board of Aldermen’s meeting, Alderwoman Ford-Griffin said she believed that the redevelopment would take longer than the 15-year projection, and acknowledged that it would be difficult to complete all that is included in the proposal.

“I think if we were to get half of what is in this plan, we will get a lot for Saint Louis.”

For projects undertaken with TIF monies, the bidding process would be public, Laskowsky said. However, the remainder of the project would involve private business contracts.

Laskowsky said McEagle had conducted its land acquisition business in the north side under different company names, so as not to attract attention.

Had property owners known that one company was conducting a large-scale buy up, property owners would likely have raised their asking prices. If a project is announced early, it often becomes subject to uproar from community members and city officials, Laskowsky said. In that case, a project “becomes not feasible.”

Announcing a large-scale project before buying properties, Laskowsky said, is “just backwards.”

There is not yet a definitive list of which properties are needed for the development, Laskowsky said, because as business deals are made, locations and space requirements may change. The list is “very fluid,” he said. “It gets you in the ballpark for what’s possible.”

Laskowsky said that legacy properties — properties that McEagle is intent on preserving — account for 50 percent of the project, or more than 2,000 properties. “The fact that they’re in the boundary only means good for their property values,” he said.

McEagle is only interested in about one third of the remaining properties, Laskowsky said.

“Already half of the land is stuff we love,” he said.

Laskowsky said the company is reticent to publish an existing property list, because it could spur vandalism, brick thieves, and fires. “It’s like putting a bull’s eye on them,” he said.

If the project goes ahead as planned, then in about six months, Laskowsky said, there will be an evaluation of properties. Specifically, he said, about 60 properties with buildings are being considered for possible rehabilitation.

If any properties are deemed unsalvageable at that time, Laskowsky said, they would be put on a demolition list. According to the TIF application, the development company has committed to demolishing all properties by the end of 2010.

Caitlin Hartsell, a student at Washington University, is an intern at the Show-Me Institute.

By Audrey Spalding
Show-Me Institute

A not-yet-approved $8.1 billion development of the city of Saint Louis’ north side is already facing legal action. Critics of the development have been very vocal regarding their concerns about blighting, the use of eminent domain, and whether the project has any financial backers. The development company, NorthSide Regeneration LLC, has asked the city for $390.6 million in tax increment financing (TIF).

On Oct. 8, some of those concerns were put into writing and submitted as a lawsuit filed on the behalf of a north side resident, Bonzella Smith. The attorney behind the case, D.B. Amon, is a known critic of the development project put forward by Paul Mckee, and of the development company.

The lawsuit, available here, includes a litany of claims. Of the largest, it alleges that NorthSide doesn’t have evidence of financial backing for the project, that the Saint Louis TIF Commission didn’t properly investigate the proposal before recommending it unanimously to the city’s Board of Aldermen, and that blighting will reduce property values, if not eventually leading to the use of eminent domain. The lawsuit’s wide range of allegations impact aldermen, the TIF commission, the mayor, and the development company. Aldermen Marlene Davis and April Ford-Griffin, who represent wards that lie mostly within the bounds of the proposed development’s 1,100-acre footprint, have claimed repeatedly that blighting has no negative consequence, and that eminent domain will not be used.

At a short Thursday hearing, 22nd circuit court judge Robert Dierker ruled that he has jurisdiction to hear the case. Dierker, known for writing the book The Tyranny of Tolerance, joked during the hearing about a recent Supreme Court verdict. “For all practical purposes, there is no substantial limitation to the jurisdiction of this court.” He also made another wry off-the-cuff remark about how agencies and commissions are created in order to take on roles not allocated to government within the Constitution.

The development company’s lawyer, Paul Puricelli, has already filed a motion to dismiss the case, on the grounds that the development has yet to be approved.

“Why are we worrying about this now?” he asked during the hearing. The case could be pursued, he said, if the Board of Aldermen voted to approve the development.

Regardless of its merits, Puricelli’s point may soon be moot. On Friday, the Board of Aldermen will meet and is scheduled to perfect two board bills that would approve the redevelopment and the first half of TIF monies for the project. If the development continues to move quickly through city government, it could be approved as early as Nov. 6.

The next hearing for the north side suit has not yet been scheduled. In the next 25 days, Amon must file a response to Puricelli’s motion for dismissal. If Dierker does not dismiss the case, another hearing will be scheduled.

By Audrey Spalding
Show-Me Institute

On Wednesday, Gov. Jay Nixon announced an additional $200 million in state budget cuts. The cuts come in the wake of low state revenue numbers for the first quarter of the fiscal year. In early October, the director of revenue’s office announced that the state had taken in nearly 10 percent less in revenues than it had during the previous year.

The largest cuts came from Medicaid ($32.45 million for “cost containment”), the Department of Public Safety ($33 million for employee cuts and shifting costs to other agencies), making fewer building repairs ($20 million), K–12 transportation ($15.8 million), and nearly all of the funds allotted to the Life Sciences Research Board ($13 million).

A full  spreadsheet of the budget cuts can be downloaded here.

The governor’s announced cuts today amount to a small fraction of the $23 billion budget for the year, totaling less than 1 percent. If the current trend in decreased tax revenues continues, the state will likely have to make more cuts in the future.

By Audrey Spalding
Show-Me Institute

A district affiliate of the majority state teacher union, the Missouri National Education Association (MNEA), has appealed a state judge’s ruling that public school teachers can choose whether to be represented by one union, several, or none. Most public school districts in the state negotiate with only one teachers’ union, but a select few, such as the Springfield, Brentwood, and Bayless school districts, allow non-exclusive teacher–school district negotiations.

The issue of teacher union representation came to a head at the Springfield School District when the Springfield National Education Association (SNEA) filed suit on June 2.

The SNEA argued against a district policy that allowed teachers to vote first for either single, multiple, or no representation, and then later to vote on which union (or unions) would represent them in negotiations with the school district. In court, Sally Barker, an attorney for the SNEA, argued that such a voting system represented a “false choice,” and that collective representation was traditionally understood to be done by a single union.

The Greene County Circuit Court allowed the district policy. In his ruling, Judge Michael Cordonnier wrote that the Article I, Section 29, of the Missouri Constitution provides for multiple representation with the following language: “That employees shall have the right to organize and to bargain collectively through representatives of their own choosing.”

“The word ‘representatives’ in Section 29 is unambiguous, plural, and must be read to include the possibility of more than one representative,” Cordonnier wrote.

On Oct. 20, the SNEA filed a notice of appeal with the Southern District Court of Appeals. The appeal itself hasn’t been filed with the court, said Sandra Skinner, the court clerk. The filing could come as late as the end of January, she said.

BAYLESS

Another teacher union lawsuit, this one on the behalf of the Bayless National Education Association (BNEA), has been scheduled for trial on Dec. 11 at the Saint Louis County circuit court. According to court documents, Barker will be representing the BNEA.

The BNEA’s suit alleges that the school district has violated Article 1, section 29, of the Missouri Constitution by refusing to recognize the BNEA as the exclusive bargaining representative of the district’s teachers, or agreeing to let teachers vote on the matter.

Under the district’s policy adopted in Feb. 2009, “Bayless Working Together,” teachers in each school building nominate and vote for two representatives and one alternate, regardless of union affiliation. In its response to the lawsuit, the district wrote that it prefers to keep the current collective bargaining arrangement in place.

At trial, Barker will likely argue that the district’s bargaining policy isn’t a legitimate form of collective bargaining and violates the state constitution.

In the lawsuit filed on behalf of the BNEA, Barker wrote that the district’s collective bargaining policies “violate Plantiff’s right to engage in collective bargaining within the meaning of Article I, Section 29.”

By Audrey Spalding
Show-Me Institute

In about a week, Saint Louis County voters can decide whether to prohibit smoking in most public areas, with exceptions for a number of places, including casinos and bars that take in little to no revenues from food sales. With the vote impending, County Councilman Barbara Fraser, who sponsored the bill, and Bill Hannegan, the area’s most active critic of proposed smoking bans, met to debate its merits at the Center of Clayton on Monday. A small crowd of about 20 people showed up.

If voters pass the countywide ban on Nov. 3, a similar ban will take effect in Saint Louis city and other parts of the state may follow suit. Fraser, when asked by an audience member what the implications would be for the state if the legislation were passed, said the county legislation could be a stepping-off point for state and local governments.

“So goes Saint Louis County, so goes the state,” she said. And later: “Let’s be not only the economic engine of the state, but the public policy engine of the state.”

Fraser argued that the health benefits of banning smoking from many public places far outweighed concerns about property rights, and that concerns about the negative impact on businesses was unfounded. She said that if a person looked at the unbiased, peer-reviewed research, the evidence said that smoking bans did not harm private businesses, and helped reduce diseases associated with smoking.

“Smoking bans save more than a half million lives each year,” she said.

Hannegan disagreed, stating unequivocally that the ban would have large, negative consequences for area businesses. An estimated one of every five jobs at city bars would be gone if the city and county ban were in place, he said. And, on top of that, Hannegan said, the ban isn’t an equitable one.

“It does not create a level playing field,” Hannegan said. “You can still smoke on the casino floor.”

He called the legislation “hastily crafted for political reasons,” alluding to Fraser’s campaign for state senator for the 24th district.

Hannegan, who also attended meetings concerning a city smoking ban, said politicians in general were more interested in social engineering than in what was best for their constituents.

“It was really chilling to listen to restaurant and bar owners plea for their economic lives and watching politicians basically go on a power trip,” he said, referring to the city smoking ban hearings. “It was about themselves, it wasn’t about the good of Saint Louis.”

By Andrew Guevara

For the Show-Me Institute

On Oct. 25, hundreds of people gathered underneath the Arch to urge President Barack Obama to take action against climate change in December at the United Nations Climate Control Conference in Denmark.

The event was organized by 350.org and other environmental groups, such as Greenpeace, 1 Sky, and Power Shift as part of an international day of simultaneous climate action rallies across the world to advocate that world leaders draft a strong climate treaty.

Many people brought signs printed with the word, “350,” a number that is significant to climate change activists.

According to Linsey Berger, the Master of Ceremonies for the eventand a student teacher at Missouri State University, 350 is the absolute safe maximum amount of carbon dioxide in parts per million that can be in the earth’s atmosphere. But unfortunately, she said, the planet is currently at 387 parts per million.

Mark Templeton, director of the Missouri Department of Natural Resources, and Saint Louis Mayor Francis Slay both spoke at the event, along with five others, including environmental experts and religious leaders.

“Our climate could become like that of South Texas or Northern Mexico,” said Templeton. “We need good economics in addition to science.”

Mayor Slay spoke briefly about his concern for climate change near the start of the rally.

“The problem is international, the fight is national and the solution is local,” he said. Slay was one of 60 U. S. mayors that signed the U.S. Conference of Mayors Climate Protection Agreement earlier this month in Seattle. The agreement is a pledge that has since been signed by more than 1,000 mayors across the country to take action to reduce carbon emissions in their respective cities.

“Here in Missouri, the voters voted last fall. We won every single county in the state with an overwhelming majority, two-thirds of the voters in the state of MO voted for clean energy,” said Kat Logan-Smith, executive director for the Missouri Coalition for the Environment.

“They voted for clean energy because we don’t want to be left behind,” she said.

The clean energy initiative Logan-Smith referred to is Proposition C, passed in 2008, which requires investor-owned utilities to buy or purchase 15 percent of their energy from clean energy resources.

Although the state has taken initiatives to incorporate clean energy into the state’s power generation, the issue of Missouri’s coal-based economy has caused some to express concerns about what comprehensive climate legislation would do to the state’s economy, such as Sen. Claire McCaskill and state industry leaders.

“We’re [Missouri] going to have a different transition period,” said Berger, the student teacher and MC. “It’s not where we are, it’s where we need to be.”

Dan Cohn, a student at Washington University, and part of the campus-based group Green Action, also said he felt the long-term benefits would outweigh the short-term costs.

“Not passing legislation and allowing the production of coal will have much higher costs for Missouri and the world, economies everywhere,” Cohn said. “Instead of coal companies receiving subsidies, use those for clean energy to reduce the chance of catastrophic climate change and reinvigorate Missouri’s economy in a way coal won’t be able to.”

By Audrey Spalding
Show-Me Institute

An $8.1 billion development of the city of Saint Louis’ north side moved closer to final approval on Thursday when the Housing, Urban Development, and Zoning (HUDZ) committee voted 13-1 to pass the project forward to the Board of Aldermen.

The project, put forward by developer Paul McKee and NorthSide Regeneration LLC, needs city approval because it calls for $390.6 million in tax increment financing (TIF). The two bills passed by the HUDZ committee establish a redevelopment agreement with the city (available online as an attachment to this PDF document), and approve up to $200 million in TIF monies for the first half of the development.

McKee spoke briefly for the project and stressed the number of construction and permanent jobs it could bring. “We’re excited to put a sign on the north side that says ‘open for business,’” he said.

Only Alderman Terry Kennedy voted against the bills. Prior to voting, Kennedy spoke at length about how he disapproved of the secretive way in which the development company had gone about purchasing land. He was referring to how the company had purchased more than 900 properties in the north side with 12 shell companies designed to hide the fact that a large-scale buy-up was taking place.

“I personally cannot support that approach,” Kennedy said.

The committee hearing, which took about three hours, included a long explanation of the project by Deputy Mayor for Development Barbara Geisman, questions from committee members, and public comment.

Two controversial parts of the proposed development were discussed at length but still left somewhat unresolved. The first, whether the city would back any of the bonds generated from loans taken against the future promise of TIF monies, was not considered at the committee hearing, nor is city backing included in the proposed development agreement.

“There is no city guarantee,” Geisman said. “But again, this issue may be revised at a later date.”

The other point of controversy, the use of eminent domain, was argued back and forth by members of the public and city officials during the public comment portion of the meeting, with Alderman April Ford-Griffin calling fear of eminent domain based on misinformation and myths.

“It’s still in this bill,” said Keith Marquard, an active critic of the proposed development. “It’s a lie to say that it is not.”

Geisman said repeatedly during her presentation that eminent domain was not allowed in the redevelopment agreement, but that if it came down to it, situations could arise in the future “where individual aldermen believe eminent domain is necessary.”

If the project continues to move quickly through the city government approval process, McKee said that the development company will apply for $20 million in state tax credits this year.

Those tax credits, established with the Distressed Areas Land Assemblage (DALA) Tax Credit Act, allow a developer of a large-scale development to collect up to $20 million each year in reimbursement for 50 percent of land acquisition costs (which can include real estate brokerage fees, demolition of vacant buildings, and maintenance costs) and 100 percent of maintenance costs. No other developer has yet applied for the DALA tax credits.

Alderman Antonio French, who was present at the hearing but not a committee member, questioned Paul McKee about how those tax credits would be used.

“Will you use Distressed Area Land Assemblage Tax Credits to redevelop the area or just pay down your debt?” he asked.

Geisman answered the question, first clarifying that DALA tax credits could be used toward redevelopment, according to the state statute. She added that the tax credits could also be used to pay down debt “so that the developer can free up debt capacity to purchase new property.”

On Friday the bills will be read a second time at the Board of Aldermen’s weekly meeting. After a third reading the following week, aldermen could vote to perfect and pass the bills.

By Andrew Guevara
For the Show-Me Institute

In September, the Missouri Department of Insurance reported the lowest number of new medical malpractice claims in 10 years and the lowest number of claims open in almost 30 years. According to the 2008 Medical Malpractice Annual Report, 1,215 new malpractice claims were filed and 3,017 cases were pending.

Meanwhile, the state insurance industry continued to earn a profit, which the report attributes to fewer claims filed and smaller payouts paid by malpractice insurers. The average claim for 2008 was $202,612, approximately $50,000 less than its “period high” peak in 2005.
Tort reform proponents claim that the new figures, coming less than five years after state legislation was passed to restrict medical malpractice claims, are evidence of success.

“The whole tort system had gone completely out of control,” said former Senate President Pro Tem Michael Gibbons.

Gibbons,  who backed the reforms, said the decline in the number of malpractice claims and payout size is tied to medical tort reforms that former Gov. Matt Blunt and a Republican majority General Assembly voted into law during 2005.

The reforms placed a cap on non-economic damages, restricted suits to be filed only in the same county where the accused negligence occurred, required defendants to pay full judgment only if they are found to be responsible for more than 50 percent of the negligence, and implemented other  limitations.
The purpose of the state’s tort reforms, Gibbons said, was “to create an environment that was more consumer friendly, with better quality health care, and to reduce costs.”

After the 2008 malpractice report was released, Blunt wrote in a Wall Street Journal op-ed that the 2005 legislation had helped to reduce the number of “junk lawsuits” in Missouri, lower health care costs, and provide better access to health care.According to the 2008 malpractice report, payouts have also declined. Providers issued $31.7 million less in written premiums to health care providers from 2006 to 2008, compared to the $5.8 million increase in written premiums from 2003 to 2005.

“It was important for Missouri to rebound from 2003 to 2004,” Gibbons said, and claimed that “2005 to 2008 have been buzz times for the state.”

Even though Blunt and Gibbons interpret the decreased number of claims filed as a positive change, trial lawyers see this as a defeat for patients.

Wally Bley, an attorney at the Columbia-based Bley & Pfeiffer law firm, said that the decline in claims is a “false victory.”

“This alleged reform has taken away patients’ rights to collect for negligence,” Bley said.

“There are as many phone calls from people as ever, but we can only take many of them when their cases are economically worth pursing,” he said.

THE REST OF THE COUNTRY
The decreasing cost of malpractice premiums in Missouri also reflects a national trend.

The Medical Liability Monitor 2008 Rate Survey, a study that examines medical malpractice premiums nationally, shows that 43 percent of medical malpractice insurers surveyed reported a decrease in premiums, 50 percent reported no change, and 7 percent saw an increase.

Geographic location, including state and metropolitan region, plays a large role in premiums, according to the survey.

For example, a general surgeon in the Kansas City area saw no percentage change in medical malpractice premiums from 2007 to 2008, and continued to pay $132,314. A general surgeon in the Miami-Dade County, Fla., region saw a 22-percent decrease in premiums but still paid $214,893. The lowest rates reported for general surgeons during 2008 were in North Dakota, with premiums of $18,063.

The study cited four possible reasons for a decrease in claim frequency, and thus a trend in reduced premiums nationwide: better risk management practices for patient care; state-level tort reforms; an increase in legal costs for plaintiffs, which could result in claims with a low chance of success not to be pursued; and the success of an “access-to-care” crisis campaign, which claimed that higher malpractice costs could lead to lower-quality health care.

Missouri seems to be following the trend predicted by the “access-to-care” campaign. Since the passage of the 2005 tort reforms, more practicing doctors have stayed in Missouri, according to reports from the Board of Healing Arts, the agency responsible for licensing and regulating physicians. According to the board’s calculations, Missouri lost 447 physicians between 2003 and 2005; however, between 2006 and 2009, Missouri gained 487 practicing physicians.

THE IMPLICATIONS
Missouri’s tort reforms could be freeing doctors from conducting medically unnecessary procedures and tests in order to prevent potential medical liability suits, known as “defensive medicine.”

Jeffrey Howell, director of legal affairs for the Missouri State Medical Association, said, “Tort reform keeps doctors from practicing defensive medicine and lets doctors do what they do best.”

But, despite the recent decrease in medical malpractice premiums, the savings don’t seem to be reflected in health insurance premiums. According to a Families USA report, family health insurance premiums in Missouri grew 3.6 times faster than  Missouri workers’ incomes from 2000 to 2009.

Federal estimates illustrate the disconnect between medical malpractice premium costs and family health insurance premium costs. According to a 2004 Congressional Budget Office (CBO) report, a 20–30 percent decrease in malpractice premiums would decrease health care costs by only 0.4–0.5 percent.

In an Oct. 9, 2009, letter from the CBO to Sen. Orrin Hatch addressing tort reform in the United States, CBO Director Douglas Elmendorf wrote that national tort reforms could reduce U.S. health care spending by 0.5 percent — a small percentage, but a figure that would amount to approximately 11 billion in 2009 alone.

“That figure is the sum of a direct reduction in spending of 0.2 percent from lower medical liability premiums and an additional indirect reduction of 0.3 percent from slightly less utilization of health care services,” Elmendorf wrote.

Gibbons said that tort reform backers thought limiting defensive medicine costs would lower family health care costs, but acknowledged that this has not appeared to be the case.

Andrew Guevara is a student at the University of Missouri-Columbia

By Audrey Spalding
Show-Me Institute

A proposed $8.1 billion development of the city of Saint Louis’ north side will take another step forward this week. Two board bills are scheduled to be introduced at the city’s Board of Aldermen meeting on Friday.

The first, #218, is a draft ordinance to approve the proposed development, and to enter into a development agreement with NorthSide Regeneration, LLC, the company behind the project. The second, #219, is a draft ordinance to approve tax increment financing (TIF) for two of the four designated areas of the project. The TIF monies for those two areas, if approved, would come to a total of $200 million, just over half of the $390.6 million that NorthSide Regeneration is asking the city to approve for the entire project.

Whether the city will back any bonds issued on future TIF monies is unclear.

The Board of Aldermen can’t vote on these bills right away; the bills may be assigned to a committee, and must be read at least two  more times at subsequent board meetings before being put up for vote. The vote may not happen for weeks, or even months, although the draft redevelopment agreement lists Dec. 2009 as its expected approval date.

Attached to the bills is a 102-page draft redevelopment agreement between NorthSide Regeneration and the city. The draft agreement is similar to the previous versions of NorthSide’s TIF application. There is also some new language in the draft agreement concerning how the city and development company can terminate the agreement, the transfer of properties from the city to the developer, and conflicts of interest.

According to the draft agreement, NorthSide Regeneration can terminate its agreement with the city as long as no TIF obligations are outstanding, while the city can do so if the development company either fails adhere to its development schedule, violates the agreement, becomes bankrupt, fails to pay TIF application fees and administrative costs, or abandons the development.

If the draft agreement is approved as is, a large number of properties will be given from the city to the development company. Currently, the city and city-based agencies own about 1,400 vacant properties in the development area.

Most of those properties are held by three agencies tasked with acquiring foreclosed or abandoned properties, and then either selling those properties or holding them in anticipation of a large-scale development.

Another portion of the agreement explicitly states that public officials involved in the process of negotiating or approving the development cannot have personal or corporate stakes in the development.

By Andrew Guevara
For the Show-Me Institute

A group of veterans traveling across the United States in an effort to promote climate change legislation and to discourage U.S. consumption of oil from foreign countries stopped in Jefferson City on Wednesday. The group, Operation FREE, describes itself as “a coalition of veterans and national security groups working together to raise public awareness about national security threats posed by climate change and our reliance on fossil fuels.” Its tour began on Oct. 12 and will end in about two weeks.

The biodiesel-fuelled bus in which the group is traveling is painted with the tour stops on one side and the words “More jobs. Less Pollution. Greater Security.” on the other. The group said it has also purchased carbon offsets to make the tour carbon neutral.

“Every time we pollute, we create a possible threat,” said Billy Froeschner, an Iraq veteran from Missouri. Froeschner said that “threat minimization,” or “reducing threats before they happen,” is one reason they embarked on the tour.

In all, six veterans spoke about the negative consequences that they said could result from global warming, including increased global wars for resources, increased weather disasters, and disgruntled, displaced populations.

Furthermore, they said, the United States is at war for the wrong reasons.

Raf Noboa, an Iraq veteran from Colorado, said that he “thought [Americans] were there to secure a democratic regime,” but began to realize that this was not the case. Noboa said he believes that the military maintains its presence there in order to secure the oil in the region.

Ed Maye, a disabled veteran from Indiana who served in Operation Desert Storm, later echoed Noboa’s statement. “We were there to protect the oil for Americans,” Maye said.

One reporter asked Noboa whether the tour has anything to do with the current climate bill in Congress, the American Clean Energy and Security Act.

He responded, “That’s part of the debate.”

“We’re way at the beginning of the process,” Noboa said. “What the bill looks like now will be different at the end.”

He also said that the United States spends $1 billion per day on oil that goes to unfriendly regimes. According to figures cited by Noboa, the average Missouri household spent nearly 6 percent of its annual income, or about $2,000 per year, on gas.

In addition to the cross-country tour, Operation FREE has launched television advertisements, met with White House officials, visited 26 U.S. senate offices, and stood on a podium with 12 U.S. senators as they introduced the Clean Energy Jobs and American Power Act, sponsored by Sens. Barbara Boxer (D-Calif.) and John Kerry (D-Mass.).

Other stops in Missouri included Richmond Heights and Springfield on Oct. 12, and Kansas City.

Andrew Guevara is a student at the University of Missouri–Columbia.

By Audrey Spalding
Show-Me Institute

A lawsuit filed on Oct. 9 alleges that a recently passed state tax credit is unconstitutional. The tax credit, established under the Distressed Areas Land Assemblage Tax Credit Act (DALATCA), awards up to $20 million each year to developers for costs associated with purchasing and maintaining properties that are part of a large-scale development.

DALATCA may soon be used in connection with a proposed $8.1 billion development of the city of Saint Louis’ north side. The development company undertaking that project, NorthSide Regeneration, LLC, is expected to be the first to apply for DALATCA funds. According to Ann Perry, manager of development finance at Missouri’s Department of Economic Development, no developer has yet applied for the tax credit.

NorthSide Regeneration plans to collect up to $83.6 million under the tax credit, according to documents submitted to the city in September. If approved by the city’s Board of Aldermen, the organization will apply to receive the money in equal payments of $16.72 million over the course of five years, beginning in 2010.You can download a copy of the three-page DALATCA application here.

The $16.72 million annual payout is more than was allowed under state statute until DALATCA was amended in April. Under the previous version of DALATCA, the maximum tax credit payout was capped at $10 million per year. In fact, the state’s website that lists statutes has not yet been updated to reflect the changes.

Irene J. Smith, former alderman, administrative judge, and mayoral candidate, is the attorney representing the plaintiffs. Smith, when reached by phone on Monday, said one of the unconstitutional  characteristics of DALATCA is that the act’s purpose is disconnected from its cost. While DALATCA’s stated intent is to encourage development, Smith said, it reimburses developers for land acquisition and maintenance costs. “That doesn’t pertain to development or redevelopment,” she said.

Another allegation of unconstitutionality in the suit is that the amendment to DALATCA was slipped covertly into HB 191, a bill that amended many disparate statutes. In the suit, Smith characterized the title of HB 191, “Relating to taxation, with penalty provisions and an emergency clause for certain Sections,” as “… overly inclusive and amorphous in violation of the Missouri Constitution, Article III, Section 23.”

Smith did not seek to file the lawsuit — she was approached by Keith Marquard and Barbara Manzara, the two plaintiffs in the suit. Both Marquard and Manzara are active critics of NorthSide Regeneration’s proposed development. Smith said the goal of the suit is for the court to declare DALATCA void.

Former state House Speaker Rod Jetton, who sponsored a version of the DALATCA bill in 2007, was not immediately available for comment.