The consolidation of St. Louis, St. Louis County and all 88 county municipality governments could save $55 million in year one and more than $1 billion in year 10, according to finance estimates released Tuesday by merger-advocacy group Better Together.
The analysis shows that the merged city’s annual budget would run a surplus — even after deep tax cuts, more than $175 million in annual debt payments, and yearly distributions back to the municipalities, which have been critical of the plan so far.
“We have municipalities saying they’ll be operating in the negative,” said Better Together associate director Kyle Juvers, who calculated the figures. “That’s not accurate.”
Juvers explained that, to estimate the plan’s viability, Better Together reduced the total budget for nearly all regional governments by 3 percent per year for 10 years, and then added back 2 percent for inflation, totaling a 1 percent reduction annually.
He then compared that to revenues that also dip every year, as the proposal cuts property taxes and phases out St. Louis earnings and payroll taxes.
Critics immediately scoffed at the analysis.
“That’s not a plan,” said Pat Kelly, executive director of the Municipal League of Metro St. Louis, an association of area municipalities. “How are you going to accomplish that? What is going to be reduced? If that’s really the analysis they have, that doesn’t make any sense whatsoever.”
University of Missouri-St. Louis professor E. Terrance Jones, another vocal critic of Better Together so far, said he and colleagues were waiting to see the figures. “We plan, as part of our obligation as researchers, to review them and check them out,” said Jones, who occasionally contracts with municipalities.
Jones and Kelly both added that multiple studies had shown that mergers don’t always produce savings. A study of Louisville, Ky., where voters approved a merger in 2000, compared spending in the five years before the consolidation with the five years after, and marked savings at about 1 percent. Jones said that savings had since disappeared.
And a larger study of nine consolidations, including Nashville, Tenn., “found no systematic relationship between merger and cost-savings,” Jones said.
But Better Together staffers explained that they weren’t creating a budget — that would be the job of the new government’s leaders. They were just producing estimates that show the new metro city wouldn’t go broke as taxes dipped — that the job was doable.
“This is trying to be as conservative as possible,” Better Together attorney Chris Pieper said. “We’re showing there’s plenty of money to operate this government.”
The group announced late last month its plan to gather at least 160,199 signatures and place on the November 2020 statewide ballot a measure to merge St. Louis and St. Louis County. That same day, it filed proposed constitutional amendment wording with the secretary of state.
The initiative, if passed by Missouri voters, would combine under one metro city the police departments, court systems, roadways, regional planning and zoning and economic development arms of the city, county and the 88 county municipalities. County municipalities would become new political subdivisions, called “municipal districts,” with power over some services, such as parks and trash collection, but with otherwise severely restricted authority.
The proposal has sparked fierce debate across the region.
The region’s two most prominent business organizations, Civic Progress and the St. Louis Regional Chamber, have committed business groups’ “time, energy and resources” to the effort.
But municipal organizations, including the St. Louis Area Police Chiefs Association, the city of Chesterfield and the Municipal League, largely oppose the plan. Municipal League volunteers and elected officials have begun gathering voter signatures to put a competing proposal on the St. Louis County and city ballots.
Nancy Rice, director of Better Together, acknowledged on Tuesday that, in the end, the success of the plan would rely on the region’s future leaders. They’d find efficiencies. They’d cut the budgets.
But she also thinks they can do it.
“We have redundancies that will be pretty obvious to the leaders of the new city,” she said.
Editor's note: An earlier version of this story contained an error in the headline. The headline has been corrected.