Letter writer responds to criticism of efforts to change state TIF laws

Letters+to+the+editor

To the editor:

Regarding Peter Russo’s March 15 letter to the editor, “Letter writer opposes Tsichlis’ effort to change Missouri’s TIF law,” it must be noted that this is not Lindbergh Board of Education Treasurer Mike Tsichlis’ bill.

Dr. Tsichlis is a supporter of the bill, which is sponsored by Rep.  Dan Stacy (R) and co-sponsored by Reps. David Gregory, R-Sunset Hills; Mary Nichols, D-Maryland Heights; and former Lindbergh Assistant Superintendent Rick Francis, R-Perryville.

How does support for the bill also mean that “schools are operating their own state?” Schools operate in districts and are dependent on tax revenue.

In a tax-increment financing project, or TIF, potential future revenues are diverted away from districts and other entities, such as municipalities.

School districts do not wish to become decision makers, but they do want to protect their income. Most districts want to be good stewards of the tax monies they receive.

Furthermore, Mr. Russo’s letter does beg some questions. Are we to thank TIF for the dirt piles at the Crestwood mall site?

If so, there is not a lot to be thankful for as the development is on hold.

What is the connection between student growth and Gravois Bluffs? Could this be a lesson in a ‘Freakonomics’ book story? Did students come to work there and go to Lindbergh Schools?  Did their parents move here because of the Bluffs?

Would there have been no development on the Bluffs whatsoever had there not been TIF?

How does any vacant property yield zero tax dollars? It is simply not true unless specifically exempted by law. Vacant properties do pay property taxes.

The property known as Crestwood Court, property locator 25L140162, paid $95,882.09. This amount would have been more if the developer had not successfully appealed the assessment.

How does a school building equate to a homeowner’s mortgage?  “Not one of you can say, ‘I am mortgage free.’” Only if I sold my home could I say I’m mortgage free. As long as there are property taxes, there are always expenses associated with owning property.

Skipping the histrionics of the letter, House Bill 1236 simply asks for an opportunity for a taxing district to opt out of a bad TIF-backed development.

A taxing district such as schools, the library, police and fire, et cetera, can decide to keep its current tax revenues on a given property and its future increased revenue if the property value increases rather than have those revenues frozen — for 15 years in the case of Crestwood Court.

A taxing district can say it wants to keep zero percent to 100 percent of property-tax revenues backed by a TIF.

In the case of Crestwood Court, opting out would have been a good thing for Lindbergh Schools, with $19 million gained over 15 years instead of lost.

Taxing districts would certainly change the financial model and its return on investment, as those that opt out increase the cost of the project. Then, it would be up to the developer and remaining districts to take on more risk.

Here’s a final point. So far Crestwood Court has produced nothing except a pile of expensive dirt. Any sales tax paid at the site in the future would be at a rate of 11.113 percent, close to the highest in the state. Potential shoppers would have to be willing to pay more sales taxes. Plus, there are no future tenants lined up.

So given a choice of keeping the tax dollars, would you opt in or opt out of a TIF?  It would depend whether the development is perceived as a future winner, loser or status quo.

So far, at this early point in the game, all taxing districts associated with Crestwood Court have lost.

Trisha Schelinski

Crestwood