March 14, 2006
Transportation Development Districts: Missouri Report
A recent news report from St. Louis, MO reports the success of transportation development districts. The Post-Dispatch describes the system as follows:
"On some store receipts, the tax is a line item called TDD, which stands for transportation development district. It's a tax most shoppers don't know they're paying. But they are, at 37 or more shopping centers in St. Louis and nearby counties, including the Promenade in Brentwood, WingHaven in O'Fallon, Mo., and several on Highway 141 in Fenton....The tax varies from one-eighth to 1 percent on every dollar spent on retail goods within these districts. Revenue pays for transportation-related items such as traffic signals, wider roads, parking spaces and sidewalks."
This news report follows a recent report by the Missouri State Auditor. In her press release on the subject Auditor McCaskill stated:
"TDDs are initiated by the filing of a petition in the circuit court of the county where the proposed district is located. For TDDs established as of December 31, 2004, 96 percent of the petitions initiating their establishment were filed by the owners of the property located within the proposed district. In many instances, it appears only a single property owner/developer petitioned for the creation of a district.
Although the Transportation Development District Act was enacted in 1990, the first TDD was not established until 1997, apparently the result of statutory changes the General Assembly made that year. These changes have resulted in a dramatic increase in the number of TDDs established. As of December 31, 2004, 69 TDDs had been established in the state. This significant growth has continued in 2005, with 18 additional TDDs being established as of October 2005.
In a survey of the 69 districts, officials of 68 of the TDDs reported total estimated transportation project costs of over $578 million. In addition, 62 of the 69 TDDs reported total estimated revenues of over $787 million would be collected during the lives of the respective TDDs. All of the districts established as of December 31, 2004, have imposed a sales tax, with rates ranging from one-eighth of one percent to one percent on retail items sold within the districts' boundaries. As a result, all retail establishments located within a TDD charge a higher total sales tax than the retail establishments that lie outside the district's boundaries."
She criticized the system as lacking in accountability and transparency. Her full report is available for download.