The St. Louis Post-Dispatch, May 27
Electric-rate boost for Bootheel jobs is a tax increase in disguise
The special session of the Missouri Legislature that wrapped up Friday proved one thing: Democrats and Republicans alike are willing to risk raising taxes, as long as it’s disguised as a utility rate increase masquerading as a “jobs bill.”
Here is a Legislature that has adamantly refused to expand Medicaid under the Affordable Care Act, even though it would have created an estimated 24,000 jobs. Here is a Legislature that won’t put a fuel tax increase on the ballot even though the state’s roads and bridges are falling apart and fixing them would create thousands of jobs. Here is a Legislature that, on the last day of its regular session May 12, went far out of its way to kill a minimum wage increase in St. Louis.
Those workers in St. Louis are just as poor as workers in southeast Missouri for whom lawmakers professed profound sympathy during the special session. To help out those in the Bootheel, the Legislature passed House Bill 1, allowing the Public Service Commission to approve special low rates for power that Ameren Missouri would sell to two potential industrial customers in New Madrid County.
We’re glad that 500 workers might get jobs if the former Noranda Aluminum smelter reopens and if an India-based steel company opens a mill nearby. If both “ifs” come true, the firms could also seek state tax breaks for creating new jobs. As state Sen. Bill Eigel, R-Weldon Spring, noted Friday, “Missouri is one of the leaders of corporate welfare in the United States.”
So Missourians would underwrite the Bootheel jobs in two ways: By giving up state revenue and by absorbing any losses that Ameren incurs by selling cheaper electricity. The Public Service Commission staff estimates that if inflation stays low, the typical residential customer would pay just a few dollars more each year.
The staff estimated that if inflation spiked to 10 percent, residential customers - including minimum wage workers in St. Louis - could pay an additional $57 a year. Inflation hasn’t been that high since 1981, so customers can probably relax.
However, Ameren Missouri - which in the past 10 years has been granted seven rate hikes - tried to use the special session to loosen PSC regulation. Ameren has tried for years to make it easier to raise rates without going through a full regulatory review. The Legislature fought off Ameren’s 49 lobbyists in the regular session, but Ameren came back in the special session by calling regulatory relief “grid modernization” and attaching it to the Bootheel jobs bill.
The “free Ameren” language would have doomed the Bootheel bill, so the House whacked it. Last-ditch efforts to reattach it in the Senate failed - this time. Those aluminum and steel mills may never materialize, but Ameren never quits.
The Joplin Globe, May 25
Our view: Come out of the dark
Without hesitation, The Globe’s editorial board praised Gov. Eric Greitens on Jan. 10 when within an hour of being sworn in as the 56th governor of Missouri, he sent a powerful message to legislators.
He signed an executive order banning executive branch employees in his administration from accepting or soliciting gifts from lobbyists.
But something has changed about this governor who we believed would become an ethics champion. Prior to his election, he was quoted across the state as firmly believing in transparency when it comes to campaign donations.
Here’s what he told St. Louis Public Radio last year: “What I’ve found is that the most important thing is transparency around the money.” He later added: “I’ve been very proud to tell people, ‘I’m stepping forward, and you can see every single one of our donors because we are proud of our donors, and we are proud of the campaign we are running.’”
Now, we find out our governor’s position on campaign money and lobbyist gifts was not worthy of praise because he has failed to live up to his word.
During the legislative session, some lawmakers pushed for “dark money” groups to disclose donors, arguing that these big donors shouldn’t hide behind anonymity while trying to sway an election. Nothing came of that push, and one need look no further than the governor as to the reason why.
Greitens’ own advisers have set up a nonprofit that does not have to follow contribution limits and isn’t required to disclose where it gets its money. Greitens, in a Kansas City Star story, defends the use of dark money saying some “career politicians” and “liberal media” are trying to mandate disclosure.
In Missouri, donations to political action committees and candidates are public documents. It’s how residents know who is behind a candidate or an issue. It’s a measure of transparency much needed.
Candidate are currently announcing their intentions to seek election or re-election in the 2018 state races. We’ve attended two such announcements this week.
Voters should challenge candidates on their acceptance of dark money and ask them to be forthright about campaign contributions.
In our view, dark money will disappear when candidates refuse to take it and voters refuse them an office if they do.
That kind of power belongs to you, not some anonymous donor with a lot of money.
The Kansas City Star, May 27
Our KCI checklist - more details and alternative proposals needed
Kansas Citians who support open, responsible government have had a good week.
But there is hard work ahead.
Thursday, the airport engineering giant AECOM told Mayor Sly James and the City Council it is interested in building a proposed new terminal at Kansas City International Airport.
The announcement means a major firm is ready to compete with Kansas City-based Burns & McDonnell, which has offered to design, build and borrow $1 billion for the project.
This competition is precisely what the public needs. It’s also what The Star has called for, even as some community leaders urged everyone to fall in line and back the Burns & McDonnell plan.
More options will yield the best possible product at the lowest cost to the flying public. The city should not only embrace the alternative but should also continue to seek other expressions of interest in the project.
Pay no attention to anyone suggesting these newcomers are too late. If we’re to believe the mayor, the Burns & McDonnell proposal came to the city’s attention only a couple of months ago. There is more than enough time to consider all approaches to the airport terminal project.
Remember: A competitive process is more than good policy. It’s good politics, too.
If voters are convinced Burns & McDonnell had an unfair advantage from the beginning, they’ll approach a November vote with deep skepticism about the airport.
We would share that skepticism.
We’ve called for a process that’s open, transparent and based on facts. Council members now must roll up their sleeves, consult with experts and the public and then begin to sort through the different ideas on the table.
Here are some benchmarks:
Cost and convenience -
We still don’t know how much Burns & McDonnell, or any other potential bidder, will earn from the project. All companies involved in the terminal process should make those figures as clear as possible.
We still don’t know how much more it will cost to park, to fly, to buy a sandwich or a cup of coffee at the new facility, either.
Current figures suggest revenue will need to increase at least $25 million a year to pay for borrowing for the project, although lower fees are possible if the public borrows the money.
We’d like to see a detailed comparison of the private financing plan and a traditional public bond plan.
And what will the design look like? AECOM, Burns & McDonnell and any other competitor should provide as many options as possible for the council and public to consider.
The airlines -
Kansas Citians have been told the airlines now serving Kansas City will cover any debt shortfalls at the new terminal.
The commitment is hardly comforting.
Here’s a partial list of airlines that have declared bankruptcy over the past 30 years: Eastern, Braniff, Continental, Pan Am, Midway, America West, TWA, Vanguard, U.S. Airways, Northwest, United, Delta, Frontier and American.
It isn’t hard to imagine one or more of the current carriers at KCI going under or leaving town by 2047. What happens then?
Last week, the council was told the remaining airlines would cover the additional cost if a carrier goes under. Watch out, traveler: With less competition and higher costs, your plane ticket will get more expensive.
Construction and financing -
Bidders should offer guarantees for minority- and women-owned business participation in the terminal project.
If the decision is to pursue a private financing option - an option we hesitate to endorse - then the city should know who is providing the private lending.
We also want to know if private lenders require extraordinary collateral or insurance in order to make their loans.
Under the Burns & McDonnell plan, the new terminal would actually be built by a shell company called Terminal Developer LLC (or another company it chooses.)
A subsidiary of Burns & McDonnell will own half of Terminal Developer. The other half will be owned by a subsidiary of Americo Life, a local investment firm.
We’ve seen little evidence so far that these entities have prior experience in borrowing for a $1 billion project. A competitive process might bring better expertise to the table.
Burns & McDonnell has promised to build the terminal more quickly to save money. Another firm, bidding competitively, might agree to financial penalties for missing the completion date.
The way forward -
These are not minor concerns.
To date, city officials and those working on the project have essentially asked us and the public to trust their judgment.
But Kansas City has had some experience with requests for trust that have gone awry. We were asked to trust Trizec when it promised to rebuild Union Station. We got a long legal battle instead.
We were asked to trust projections for the Power & Light District. We will pay millions each year before that borrowing is repaid.
There have been successes, too. They share important traits: close scrutiny, a public process and accountability. We want all three for the airport.
Outside counsel is conducting a review before the City Council commits to a deal. But the decision deadline remains June 15, two weeks from Friday.
It’s a crucial deadline that council members and Kansas Citians should discard.
Take time. Get answers. Get this right. And get another opinion.
The St. Joseph News-Press, May 27
Insurer decision upends market
Health care, by all appearances, is a complex enterprise. So, too, is the provision of health insurance so that no one wanting it is forced to go without.
Just ask Blue Cross and Blue Shield of Kansas City, which has announced it is exiting the Affordable Care Act exchange next year after losing $100 million on these policies in the last three years.
The decision affects about 67,000 Blue KC customers in the region who signed up for insurance though the exchange when they didn’t qualify through their employer or have access to it through Medicaid or Medicare. Most received federal subsidies to purchase insurance on the exchange.
Those potentially most affected include the 20,468 policyholders who reside in 25 counties across Northwest Missouri, including Buchanan and Andrew counties. Unless another insurer - specifically Cigna - expands its geographic reach, it is possible no insurer will offer policies on the ACA exchange in these counties next year.
Few of us truly can say we understand the best way to weave an insurance safety net, but the unfolding events suggest it was relatively easy to anticipate where the Affordable Care Act would run off the tracks.
We wrote last year of the Obama administration’s continued advocacy of government subsidies to ease the impact of premium increases on those who must purchase insurance through the ACA exchanges. And still, insurers saw a need to seek new increases to cover their costs.
We offered the view at the time that if the only way people can afford insurance is with a government subsidy, and the only way insurers can make money in these instances is if consumers receive subsidies, are we not on a path to universal government-provided insurance?
The Republicans are getting their turn to craft new legislation that will attempt to improve the provision of health insurance. The first attempts have been flawed but do a service in proposing ways to lower the overall cost while retaining critical protections for those most in need of insurance.
This balancing act is part of an agenda correctly focused on giving the public more options, rather than fewer, in where to obtain insurance; expanding access to care; and creating a stable and sustainable insurance marketplace.
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