Many government services can be provided more effectively, and at a lower cost, by the private sector. When public services are provided by private industry, economic incentives and accountability provide a critical feedback loop that is largely absent in government bureaucracy. Show-Me Institute scholars analyze public programs to determine how taxpayers can benefit from market-based alternatives.
Missourians should consider the benefits of tolling and public-private partnerships for the state’s transportation infrastructure: up-front financing, quicker turnaround for some projects, and the assurance that those who actually use a new facility will help to pay for it — leading to fewer incentives to hike traditional gas tax funds.
A new study, jointly produced by the Show-Me Institute and the Reason Foundation, examines the relatively new funding paradigm of public-private partnerships and how such arrangements may benefit Missouri's public transportation infrastructure. The study provides an overview of the types of public-private partnerships that can be utilized for transportation projects, including their benefits and best practices, and responses to common concerns. It also explores how public-private partnerships can be used not only to upgrade, modernize, and expand Missouri’s road and bridge network, but also to improve the delivery of transit services.
Successful societies and growing economies have always depended on efficient transportation. As cars have become more efficient, the fuel taxes used to fund the state’s highways have leveled off — but the transportation needs of the state have not. Other states have looked to the private sector to provide transportation infrastructure, as a means of augmenting gas taxes. The people of Missouri would be well-served if officials were to give this new paradigm strong consideration as the economy evolves. Public roads, funded by gas taxes, will be the primary model for transportation in Missouri far into the foreseeable future. However, the options that public-private partnerships facilitate should be a part of the discussion for future transportation projects and plans.
The tremendous drawbacks of the light-rail plan approved by Kansas City voters required intervention by the City Council. Now, as officials attempt to balance competing transit goals, they should consider non-rail alternatives like additional bus–rapid transit lines and allowing private contractors to bid on the right to operate bus routes.
A new policy study from the Show-Me Institute considers whether light-rail transit is a worthwhile investment for Kansas City. The study, “Review of Kansas City Transit Plans,” analyzes recent proposals and, in the process, repudiates many of light rail’s presumed benefits as a transit solution. The study also makes recommendations for ways in which Kansas City can address its transit needs in a fiscally responsible manner.
After rejecting rail transit proposals at the polls six different times, Kansas City voters approved a light-rail plan in November, 2006. This plan, however, has proven infeasible, with costs at least 50 percent greater than its promoters projected. Implementing the plan would require cutting bus service by as much as 40 percent. While the City Council formally repealed the plan in November, 2007, many people in Kansas City still believe that some form of light rail or streetcars would be worthwhile. A close look at other urban areas that have built light-rail transit during the past three decades offers many lessons for Kansas City transportation policymakers, demonstrating that rail transit is more likely to worsen congestion than solve it.
Kirkwood is the only municipality within Saint Louis County that continues to operate its own municipal utilities. Would the citizens of Kirkwood benefit if Kirkwood sold its utilities to AmerenUE and Missouri-American Water Company?
This study examines the privatization of pharmacy services in Saint Louis County. The author, Show-Me Institute policy analyst David Stokes, reviews trends in both the budget and actual expenses of county pharmacy operation, which show that before 2003, costs were rapidly rising — consistently outstripping budgeted figures. When the county opened a competitive bidding process for provision of pharmacy services in early 2003, costs began to drop dramatically. Since then, the county has spent less than it budgeted on the pharmacy every year, even as those budgeted amounts continue to decrease each year, in response to the significant cost savings. While this privatization was saving taxpayer dollars, it was also — more importantly — providing better pharmacy services to the people of Saint Louis County who used the health department clinics.
The Missouri Department of Transportation is using new ideas and innovations to deliver quality transportation to the residents of Missouri. MoDOT deserves a great deal of credit for changing the manner in which it works for Missouri and for its creative thinking in how to address the state’s transportation needs.
Proposals for a new bridge connecting Missouri and Illinois focus on supply when the real problem is demand. By efficiently pricing the use of scarce road space, driving during peak times will drop to manageable levels — without significant taxpayer expense.
As time marches on, the pace of technological advancement marches along with it: the hand-written letter becomes an email, the horse and buggy becomes the automobile, and the pen and paper become the word processor. These advancements are mirrored in the media services industry by the ability to use iPods and cell phones to access programs once available solely through the home television set. Though the options for accessing media services outside the home have increased dramatically, the cable television market has remained largely stagnant. This stagnation results from current policies limiting competition amongst cable providers. Changing these policies will benefit consumers in the form of lower prices and better service.
Joseph Haslag estimates the benefits of increased video competition to Missouri consumers, to state coffers, and to the state as a whole. He finds that increased video competition would benefit consumers by between $66 million and $76 million annually. On the other hand, incumbent cable companies would be harmed by between $45 and $53 million per year. On net, therefore, increased competition would benefit the state by more than $20 million per year. Franchise reform would also benefit the state if it attracted new infrastructure investments. Based on the experience of other states, Haslag estimate that new entrants would make $420 million in capital investments. If made in one year, that quantity of investment would generate roughly $17 million in additional state revenues the first year, and approximately $1 million annually in subsequent years.
A few decades ago, cable TV looked like a monopoly that was here to stay. Missouri passed cable franchise laws, which require cable companies to go through a time-consuming process to obtain permission to operate from local governments. One rationale was that franchise laws would protect consumers, but now that new technologies have sprung up that offer alternatives to cable, those outdated laws actually keep potential competitors out of the market. Missouri should pass cable franchise reform so consumers can enjoy lower prices and better service.
Missouri’s cable franchise law restricts competition and leaves consumers with few choices. Since the Texas legislature passed cable franchise reform, Texas consumers have benefited from better service and lower prices. Missouri should enact similar legislation to attract investment and increase competition.
Some activists are demanding that the government force the cable industry to offer its television channels “a la carte.” That may sound good in theory, but in practice it’s a bad deal for consumers. Customers’ bills aren’t likely to go down very much, but they’ll get a lot fewer channels for their money
Municipalities currently have the power to regulate cable TV service in their community through the use of franchise agreements. Increasing competition has made that system unnecessary, and, ironically, it has become a major impediment to competition. Missouri should follow the lead of Texas and replace it with a streamlined, state-wide franchise system.
