January 17, 2018
AggMan understands that the aggregates business is made up of local businesses throughout the nation. As such, we are focused on providing insights into these local markets, as well as national markets, in print and online.
We contacted Morgan Mundell, executive manager of the Missouri Limestone Producers Association (MLPA), who was kind enough to give us his take on what’s happening with the aggregates industry in the Missouri.
1) How would you characterize the state of the aggregates market in Missouri?
Mundell: The market has been somewhat stagnant over the last few years. The Missouri Department of Transportation has experienced funding issues and has seen diminished construction of infrastructure which has hurt the market. Missouri is also seeing an influx of smaller operations that make the market more competitive. However, the market is slowly starting to recover from recession levels.
2) How is Missouri addressing transportation funding?
Mundell: Historically, Missouri has had problems funding transportation. The state ranks 7th in the country in the size of its transportation system but only 46th in terms of funding. The current gas tax is $0.17 per gallon and has not been raised since 1996. Considering inflation, the purchasing power of that $0.17 from 1996 is roughly $0.08 cents. In 2014, Missouri voters turned down Constitutional Amendment 7 by a margin of 59 percent to 41 percent to raise the gas tax.
This summer, the 21st Century Transportation Task Force held meetings across the state to get input from citizens and stakeholders about how to address Missouri’s transportation problem. That report culminated in several recommendations on how to increase funding, yet they are simply recommendations and require legislative and voter approval.
These recommendations have led to the filing of several bills in the Missouri Legislature this year to increase transportation funding. But due to a constitutional provision dealing with state revenues, any increase will have to go back to a vote of the people for final approval, and raising any type of tax in Missouri is a hard sell with voters.
3) What are the big opportunities for producers in Missouri (DOT projects, commercial construction, etc.)?
Mundell: Private commercial development has been a large consumer of aggregate in recent years, and with the recent economic growth, producers are seeing a slight increase in commercial and residential construction. This has helped offset the lack of new DOT projects.
4) What are the big obstacles for producers in Missouri (legislation, neighborhood groups, etc.)?
Regulatory actions by the government always pose a challenge, however we have seen a better climate in the last year under a new gubernatorial administration and a new Director of the Department of Natural Resources, Carol Comer. Missouri is currently reviewing all of its regulations and has solicited comments from the public, which the MLPA participated in. We are also always on the lookout for new legislation that restricts our industry’s abilities to expand operations or limits production. Population growth can also present challenges as urban areas expand and often “grow around” an operation.
5) What would you like your peers to know about aggregates production in Missouri?
Mundell: Crushed stone production is a vital industry in our state. Missouri is the 5th largest producer of aggregates in the United States, and the industry employs more than 2,500 people with a combined payroll of more than $70,000,000 annually. Millions of tons of crushed stone aggregate is produced each year in the state — about 10 tons for each of Missouri’s citizens.