Studies Detail Alternatives to Saint Louis Earnings Tax and Outline Opportunities for City-County Cooperation

Posted on Apr 8, 2011

For immediate release

The Missouri Council for a Better Economy released two studies today. One offers more than a dozen options to replace revenues provided by the City of Saint Louis’ 1 percent earnings tax; the other analyzes and offers many ways in which the City of Saint Louis and Saint Louis County can cooperate in ways that could save millions of dollars a year. 

The earnings tax study assumes that the tax would be phased-out over 10 years and offers a variety of new revenue sources and a potential cost improvements to offset the $137.5 million collected annually from the earnings tax.

The city-county cooperation study looks at a numerous ways the city and county can improve costs and services by cooperating or consolidating on back-office type operations. The study does not look at consolidation of the city and county. Instead, it outlines a number of areas where cooperation could lead to significant savings.

“We’re hopeful that these studies will be the starting point for a robust, community-wide dialogue,” said MCBE spokesman Jack Naudi. “We certainly don’t see either of the studies as take-it-or-leave-it propositions.”

The studies were conducted by PFM Group of Philadelphia, a financial and strategic consulting services firm for local and state governments. PFM has conducted revenue studies for the cities of Saint Louis and Kansas City. The $300,000 cost of the two new studies was paid by the Missouri Council for a Better Economy, which is funded by retired investment company executive and philanthropist Rex Sinquefield. Randall Bauer, a senior managing consultant for PFM, led the studies. He will be available for media interviews.

Copies of the studies, and more information about the Missouri Council for a Better Economy, can be found at