Holleman: Firm pushing St. Louis County weed-tax plan been paid $1 million by county since 2020

Since April 2020, the company has been paid slightly more than $1.03 million, according to information from St. Louis County’s Open Finances portal.

Its latest payment from the county — $300,000 approved without debate last week by the County Council — is for an “educational campaign” on a proposed 3% sales-tax hike on recreational marijuana sales.

On April 4, St. Louis County and numerous other municipalities are seeking the 3% levy. County officials say the tax could raise about $3 million a year and help offset the county’s $41 million budget deficit.

Critics of the spending have protested to the Missouri attorney general and U.S. district attorney, claiming the county violated state law by using taxpayer’s money to support a tax proposal.

Another complaint alleges a violation of the Missouri Sunshine Law, in that the original request of $150,000 from County Executive Sam Page was doubled without any discussion at a council meeting.

The increase came about after a meeting between Page staffers and council chair Shalonda Webb, D-4th District, and vice chair Mark Harder, R-7th District.

Page spokesperson Doug Moore said the language of the campaign will be reviewed by lawyers so as not to advocate a position on the tax. He cited a web page produced by Columbia, Mo., as an example of an informational approach.

Columbia spokesperson Sydney Olsen said that information and web page were the work of city employees, not an outside vendor.

And while county lawyers eventually may review materials to make sure the content is neutral, strategy discussed by Page’s office and Elasticity appears to steer the campaign in a specific direction:

On March 8, one day after the council approved the spending, Kyle Klemp, Page’s deputy chief of operations, and Emily Engelke, an Elasticity account executive, exchanged emails that discussed marketing strategy.

In that dialogue, Kemp told Engelke that campaign advertising should be focused at people who likely won’t buy marijuana, and therefore would be less likely to oppose a sales tax on it.

Also on March 8, Elasticity provided a printed strategic plan that promises “a targeted education campaign” that aims to “reach the intended target audience.”

As to the county’s recent payments to Elasticity, they began in the first days of the COVID-19 pandemic.

Beginning in April 2020, the company earned $236,124 in nine months, most of it for communications services connected to the pandemic.

The biggest bulk of that payout, more than $217,000, came in December 2020 and was drawn from CARES Act funding that the county received for pandemic services.

In 2021, the company received only two payments, for a total of $30,000. That money also came from CARES Act funds for pandemic-related communications and marketing. 

The company’s payments from the county picked up again in 2022, with payments totaling $471,414.

The bulk of the money, about $372,000, was for work with health programs related to the pandemic. The remainder was connected to the county’s efforts on solid waste management, recycling and sexually transmitted diseases.

The county has retained Elasticity for its service through a state-operated purchasing cooperative, which is designed to make obtaining service more expedient, and potentially cheaper, than by engaging in local bidding processes.

Also, St. Louis County is not the only government entity that has recently paid Elasticity for work, especially pandemic-related work.

In a 2021 story that examined state’s expenses after the pandemic struck, the Missouri Independent reported that Elasticity was paid more than $6.2 million by various state agencies in fiscal year 2021 to conduct pandemic-related marketing campaigns — with about $2.5 million coming from CARES Act funds.

Billing itself as “a collection of irreverently smart people,” Elasticity was founded in 2009. Its headquarters are at 3333 Washington Avenue in midtown St. Louis. Founding partner Brian Cross could not be reached for comment.