Regulatory Climate Index 2014: St. Louis

Regulatory Climate Index 2014

St. Louis, founded in 1764, played an important role in the development of the United States after the Louisiana Purchase. Endowed with a port located on the Mississippi River, St. Louis transformed into one of the largest economic centers in the country in the late 1800s. Although it is not the economic powerhouse it once was, the city is an important economy for the Midwest and home to a number of Fortune 500 companies.

The economy produced $136.6 billion in gross metro product in 2012, relying on biotechnology, financial services, health care, manufacturing, professional services, and transportation sectors. 48 Greater St. Louis has a total population of 2.7 million people, with 318,000 residing within the city.49 St. Louis is home to major universities and a growing start-up community. The city is aiming to catalyze its position as a low-cost city with a business-friendly environment to create more opportunities for entrepreneurs.


Benchmarking Against Others

Among the cities under review, the 2014 Regulatory Climate Index ranks St. Louis in second position, with the first place representing the most efficient regulatory environment. 

The overall score of the Regulatory Climate Index is the simple average of the scores of five areas of regulation. While St. Louis ranks second overall (score of 85.2), it ranks fourth in Starting a Business (98), third in Dealing with Construction Permits (90), first in Registering Property (100), fifth in Paying Taxes (59), and second in Enforcing Contracts (83).

What St. Louis is Doing Well

  • St. Louis ranks among the top-performing cities for Starting a Business. The city’s success is due to a minimal number of procedures and number of days, along with a low administrative cost for opening a new LLC.
  • In St. Louis, businesses can expect an efficient process for Dealing with Construction Permits. The city is among the best performers for number of procedures and waiting time across the 10 cities covered in this report. Total costs for construction permits are approximately 1% the cost of construction.
  • St. Louis earns top marks for Registering Property due to the minimal number of procedures, low waiting time, and low administrative costs for the transfer of a commercial property. The city is one of two cities in the report that does not have a real estate transfer tax. The city eliminated property transfer tax several years ago.
  • St. Louis is a top-performing city when it comes to Enforcing Contracts. Entrepreneurs can expect efficiency in the number of procedures, moderate level of waiting time, and low administrative costs when entering a contractual dispute in a court of law.


Where St. Louis Needs Improvement

  • St. Louis achieves an average ranking for Paying Taxes. This position is not completely satisfactory in absolute value, and it falls short in the context of and comparison with other cities. Four cities—Dallas, Raleigh, Atlanta, and Detroit—achieved a higher score. St. Louis’s position in the ranking is attributed to the total number of tax payments in comparison with the other cities.
  • While St. Louis is the highest-ranking city for Enforcing Contracts, the city could improve the process and waiting time in the litigation phase and the enforcement of judgment for this regulation area.


City Initiatives

St. Louis is one of the fastest-growing cities in the country in the technology sector. Recognizing this growth, the business community and the city have worked together to create dozens of incubators and accelerator groups that provide mentoring, networking opportunities, and coworking spaces for start-up companies. The St. Louis Regional Chamber of Commerce has played an important role in building the infrastructure and ecosystem for the city’s start-up community.

The St. Louis Regional Chamber was a key player in the growth of SixThirty—an accelerator that has received national media attention for its success and innovative business model. SixThirty gives emerging tech start-ups an investment of $100,000, connection to top financial services companies, and a rigorous four-month accelerator program to help the company grow. Another incubator—T-REx—has grown to 70 companies and hopes to expand to more than 150 with the acquisition of a historic building in downtown St. Louis. And it is not just the technology sector that’s driving entrepreneurs in the city. The St. Louis Biogenerator provides mentoring, access to capital, and lab space to early-stage life sciences companies.

Greater St. Louis is driving for the development of start-up companies and a network for entrepreneurs to thrive in the city. A study on the region’s business environment estimates that St. Louis needs an additional $500 million in investment over the next five years to continue building a strong ecosystem for entrepreneurs and small businesses. Further, increases in Missouri’s Technology Corporation to support early-stage businesses would provide greater resources to entrepreneurs.


St. Louis performs well in four out of the five areas of local regulations that this report reviews. The city is second in the overall ranking, reflecting its continuing efforts to develop programs and initiatives to strengthen the business environment, provide access to capital, and encourage economic growth at the local level. The city has invested time and effort in minimizing the number of procedures, waiting times, and administrative costs for small firms. Entrepreneurs and small businesses can expect an efficient regulatory environment in St. Louis.

See the attached PDF below for more detailed charts and graphs relating to St. Louis and the 2014 Regulatory Climate Index.