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The St Louis Contrarian

Providing Independent and Intelligent Insight on St. Louis Public Policy Issues

Light Rail

St. Louis is going ahead and holding meetings with regard to the north-south expansion of metrolink. This is a farce. Light rail is extremely expensive and in St. Louis has been a dangerous mode of transportation. Furthermore, new technology such as ride sharing and driverless cars will make the technology obsolete. We need to invest short term in buses and cities developing some relationships with ride sharing company so that poor people can avail themselves of these services. Written by Paul Dribin

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TIFS in St. Louis

I just read an article posted by Alderman Cara Spencer on facebook regarding the City of St. Louis financial position. The article quoted is entitled Team TIF St. Louis.

The gist of the article is that the city’s financial picture is dire and that TIF’s are the cause. As I have said previously, development subsidies are overdone in St. Louis mostly when used for projects that don’t further economic development. The analysis of TIFs is overly simplistic for the following reasons:

1. It is not really a debt. They are deferred funds that will eventually go to the city which are now going to developments.

2. Without the TIF nothing would have happened. It is not as if there would be a lesser project, there would be no project at all.

3. St. Louis is between a rock and a hard place. It is declining economically, riddled with crime and high taxes, and needs incentives to prime the pump. The real question is whether things will ever take off. Written by Paul Dribin

Tax Abatement in St. Louis

The Comptroller of St. Louis issued a report today which again demonstrated that the city is giving away millions of dollars of potential taxes to developers in the form of abatement and TIF. I consider tax abatement to be a useful development tool when properly targeted. The trouble is it has not been properly targeted. Aldermen play too big a role in the decision making process. Written by Paul Dribin

New Police Chief in St. Louis

St. Louis picked a new police chief yesterday. His name is John Hayden, an African American veteran of the St. Louis force who seems to have a very distinguished career. I wish him well in a tough job. Improving crime and policing in St. Louis is more than one person, but this appears to be an excellent selection. Written by Paul Dribin

Concentration of Crime

The St. Louis Post Dispatch carried an interesting article this weekend about crime. It showed that crime is more than ever concentrated in smaller areas, but in those areas the amount of crime is high. The disparity between the high and low crime areas is greater than ever. This certainly seems to be the case in St. Louis, but it is important to point out that there is not a complete correlation between crime and poverty. Some low income neighborhoods have less crime than others. Most people who live in low income neighborhoods do not commit crime. We need more research on the particular causes of crime and focus our policies on those situations. Written by Paul Dribin

Development Subsidies in St. Louis

I attended a neighborhood housing board meeting in one of the neighborhoods of St. Louis recently. The group discussed a rehab job on a vacant house that will cost in the neighborhood of $250,000 to rehab and then sell for $120000. Development subsides will cover the gap.

This process makes no sense to me. I see the need for development subsidies in communities that are comprehensively redeveloping their housing stock and do not yet have housing values to break even in the process. These subsides should be limited to a reasonable percentage of the ultimate value. In the case I cited the subsidy of $13000 is more than the value of the property. This is crazy and it has been done thousands of times in St. Louis. Instead of comprehensive rehabilitation, aldermen or community activists pick out a property to rehab which has not overall effect on improving the community. Someone needs to take a good look at the whole process. Milwaukee where I previously lived and worked required that any housing with rehab costs higher than the end value be demolished. Written by Paul Dribin

Greitens and MHDC Board Vote to Eliminate State Low Income Housing Tax Credits

The MHDC board met Friday and voted to eliminate the state credits. This will result in a significant loss of affordable housing in Missouri which is a tragedy. Reforms needed to be made in the program, but I don’t think Greitens is really interested in reform, simply grandstanding. Nevertheless, a big part of the reason the program was eliminated was the greed of the industry supported by the credits. MHDC never had an open application process with clear standards for judging and eliminating applications. The board made of high level political appointees was subject to legal and illegal graft. The program was run as a political fiefdom and returned far too little of the funds to actual low income recipients.

Still the program should not have been eliminated unless something better was around with which to replace it. As always low income people are the ones who suffer the most. Written by Paul Dribin

https://www.brookings.edu/blog/the-avenue/2017/12/19/is-the-rent-too-damn-high-or-are-incomes-too-low/?utm_campaign=Brookings%20Brief&utm_source=hs_email&utm_medium=email&utm_content=59518298

New Police Chief in St. Louis

St. Louis has gone through a long and consulted process to find a new police chief. Who knows why it has taken so long. I read information about the remaining candidates in the Post Dispatch over the weekend. I was disappointed to see that they are all mediocre at best and some seem terrible. One gentleman received a vote of no confidence from the police officers of his home community.

I supposed it is not surprising St. Louis is facing this dilemma. Why would a top notch candidate come here to face the exceptional crap that goes down. Crime is really high but if the police get aggressive in solving crime they are criticized. A refreshing approach would be to do as Chicago did many years ago and reach out to academia for someone. Chicago hired OW Wilson who turned the department around even though the cops hated him. Maybe we should try the same thing. Written by Paul Dribin

HUD Loans in St. Louis County

The St. Louis Post Dispatch wrote today in a critical manner that St.Louis County had not utilized some $24 million in HUD loans intended to help distressed areas. These loans commonly referred to as 108 loans from the section of the housing act they fall under are part of HUD’s Community Development Program. HUD has threatened to pull back the funding if the money is not used.

It is not quite fair to be too critical of the county in this regard. First, the interest rates on the funds are only 1% lower than market and contain much more paperwork. Second, they do not work well on small projects such as housing rehab. The county needs to come up with one or two big projects for their utilization. Third they are loans not grants and the borrowers must be creditworthy. Finally, these loans are borrowed against future block grant funding, and in fact reduce the future funding by the amount of the loan.

The county had request a waiver for use of the funds and has not received an answer from HUD despite repeated requests for a decision. This whole thing smacks of HUD covering their collective asses. Written by Paul Dribin

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