MISSOURI WATCH: WEIGHTY PROBLEMS CDOULD TURN MISSOURI INTO MISERY

When Missouri's ambitious, taxpayer-appealing, 15-year highway improvement program was introduced to the public back in 1992, someone should have raised more questions than were asked. Those of us who report on state government should have been more suspicious than we were, and I accept my share of responsibility. I've always been a sucker for good highways, having been nurtured by a father who served eight years as chairman of the state Highway Commission.

As events have since proved, however, the authors of the ambitious road program were as sloppy in writing its goals and projects as the news media was in covering the details. How can a Highway Commission and scores of very bright and able civil engineers overlook such items as inflation increases and maintenance costs, not to mention the congressional pariahs who were confiscating state tax revenue to make their profligate spending appear less reckless?

Far be it from me to suggest that any degree of deception was intended, but I can attest to the fact that we in the media asked far too few questions about this program that must now be corrected at a terrible cost to both the average taxpayer and the average motorist.

Unfortunately, this isn't the only troubled bridge the state will have to cross in a short time. Here are only some of the problems Missouri must address -- and very soon.

After earlier mentioning a recent RAND Corp. study on juvenile crime, several officials, including Gov. Mel Carnahan and key legislators, inquired about the findings. As noted earlier, the RAND report noted the efficacy of early intervention programs over the cost of constructing new prison cells. The report, broken down into four components, studied early-childhood interventions for children at risk and their later anti-social behavior; interventions for families with children who are "acting out"; school-based interventions, such as incentives to graduate; and interventions for troublesome youths early in delinquency.

Some states, but not Missouri, have developed full-scale intervention programs in all of the four categories above, and the results have been little short of miraculous. Most notable are projects undertaken in New York, California, Texas and Utah. These four programs, when compared to incarceration, reduced serious felonies by 28 percent (or 329,000 crimes) in California. Using an estimated $5.5 billion dollar price tag, the cost per serious felony prevented was only $16,000.

Would Missouri rather spend hundreds of millions of dollars to build more and more prisons, or invest in intervention programs that result in a $16,000-per-crime saving? The answer should be an obvious one, but no one is suggesting that our state launch any such plan. Worse, few officials in the state capital are even expressing concern over the millions and millions of tax dollars being spent for new prisons.

Remember when no one expressed concern over the failure of the state to end segregation of its public school systems after Brown vs. Topeka? That silence will cost taxpayers more than $3 billion before the last desegregation order is lifted.

Highways and prisons aren't the only problems facing the state in mid-term 1997. Far from it. An official of the Council of State Government recently told this writer that several problems that had earlier been predicted for resolution in the next decade had grown, almost overnight, into major dilemmas that must be resolved by governors and legislatures.

Here are a couple more, but the list is much longer:

MEDICAID SPENDING: There may be no greater problem facing state legislatures than that of controlling Medicaid spending. During 1988-1992, total Medicaid spending grew at a 22.4 percent annual rate. Alarmed, state and federal legislators passed measures to trim that growth to 9.5 percent from 1992-95, but they are still faced with a program that is presently growing beyond states' means to provide funding.

The Congressional Budget Office has projected an annual growth rate for Medicaid spending of 10.2 percent. In only one category, Disproportionate Share Hospital Payments (DSH), increases of at least 9.7 percent have been forecast for the period 1992-2002. Additionally, the study notes that future drops in employer-sponsored insurance coverage could cause the ranks of the uninsured to swell, creating still more spending.

UTILITY DEREGULATION: Retail wheeling may soon be arriving in the Show Me State, and even if it doesn't, utility wars in an adjoining state could influence rates in Missouri. While advocates of unfettered utility rates paint a rosy picture of what can happen in Missouri, fundamental changes brought about by electric deregulation will significantly reduce tax revenues at both the state and local levels.

A study by the well-respected group known as MGT of America Inc., warns that the negative impact on households, due to higher electric bills caused by a rapid transition to retail wheeling and dealing, will translate into an overall negative effect on a state's economy, at least in the near term. This, in turn, will decrease sales taxes, utility gross receipts and state franchise tax collections. In addition, stranded costs will lead to reduced property tax assessments, significantly reducing revenue for many local governments.

The MGT study also predicts that state retail sales tax revenues, based on decreased economic activity, will cost millions of dollars each year, doubling in less than three years and tripling at the end of a decade. Other losses will occur in utility receipts taxes, franchise fees and property taxes.

When this writer asked officials in Jefferson City about these potentially damaging revenues losses, the question only drew blank stares and multiple "no comment" responses. If officials have informed themselves about these potential revenue losses, it is the best-kept secret in Jefferson City.

Crossing into the next millennium may not be as happy an event as last year's politicians made it sound.

~Jack Stapleton of Kennett is the editor of Missouri News and Editorial Service.