By Lindsay Toler
By Chad Garrison
By Brett Koshkin
By RFT Staff
By Lindsay Toler
By Riverfront Times
By Danny Wicentowski
By Pete Kotz
Diana Smith shudders and scrunches her shoulders, recalling the October night her ten-year-old son Jacob kept hammering his parents with an angry question: "Why do we have to move?"
Jacob, who has an attention-deficit disorder and a form of autism, "doesn't deal well with change," says his mom. He'd been sleepless for days over thoughts of switching homes and schools, and he didn't understand his parents' explanation: "We're moving because the city is kicking us out." That night Jacob blew a fuse. So did his dad.
"I got really angry," Dennis Smith recalls. "I made calls. I called [Eleventh Ward Alderman] Matt Villa and left him a nice message, like, 'Thanks!', 'cause he don't have to live with the problems my son has."
At 3 a.m. Smith was still boiling. Then it hit him -- sidewalk chalk. Smith took his son's 50-piece pack from the closet and spent the next two hours defacing the façade of his narrow brick home, scrawling sarcastic missives to Villa and St. Louis Mayor Francis Slay, and protests of "Not For Sale To Big Corporations," and "NO TIF."
Smith's south-city neighborhood near Carondelet Park is about to become the latest of many that the city is looking to grant a TIF, a thirteen-year-old tax-increment financing arrangement that allows developers tax breaks to raise new buildings in so-called blighted areas.
The Desco Development Group, a Clayton-based developer and the Schnuck family's development company, plans to put a $40 million shopping center called Loughborough Commons on the 30-acre parcel of land at Loughborough and South Grand avenues, adjacent to I-55. Desco spokesman Steve Houston says the firm is looking to build a bigger Schnucks and a Lowe's Home Improvement Warehouse, and to bring in some smaller retailers. The project has been in the works for eighteen months.
The site currently houses a Schnucks Supercenter, a shuttered furnace plant, the Carondelet Sunday Morning Athletic Club and twenty homes that will have to be razed, perhaps as soon as February.
Desco wants $11 million in tax-increment financing for the project that it hopes to complete in spring 2006. A public hearing before the city's TIF commission is scheduled today, December 1, at 8:15 a.m. at the St. Louis Development Corporation's offices at 1015 Locust Street. If the commission approves the financing plan, the boards of Aldermen and Estimate & Apportionment are expected to green-light the project.
Tax-increment financing, or TIF, took off in California in the early 1950s and is used now in nearly every state. Here's how it works: The government freezes property taxes in the designated TIF district for 23 years. All the while, the property owner puts some money in lieu of taxes (equivalent to incremental increases in real property taxes), plus 50 percent of the econonmic activity taxes (utility, local sales and earnings) generated in the TIF district, into a special fund. The monies are then used to float bonds and reimburse the developer for some project costs.
Once a property is TIF-ed, a city agency can invoke eminent domain, relocate any resisters and bring on the wrecking ball, so long as the proposed project is for "public use" -- traditionally, schools or roads.
But does a shopping center qualify as public use? In many cases, courts nationwide have answered "yes." The U.S. Supreme Court could decide next year the constitutionality of using eminent domain for economic-development projects, when it reviews a Connecticut case pitting homeowners against developers of a hotel and health club.
Though St. Louis County has been at the center of numerous TIF-related dramas over the years, the development-starved city has only recently begun aggressively courting developers looking for tax breaks and the right to blight.
The city approved ten TIFs between 1991 and 2001, confirms Dale Ruthsatz, commercial development director at the St. Louis Development Corporation. But in the past three years, forty-four projects have been TIF-ed, and seven are in the pipeline.
If the Loughborough Commons TIF is approved, bulldozers will roll over a hodge-podge of predominantly brick shotgun houses, most of them more than 90 years old.
Many of the homeowners, some in the neighborhood for decades, were outraged when they learned of the retail plan in a September 29 St. Louis Post-Dispatchstory.
"We got broadsided," says Bill Sheahan, a twenty-year resident. "We were ticked off, mainly at the integrity part of it." At the very least, an explanatory letter from Villa, or some city official, should have been provided to affected residents, fumes Sheahan.
"No one knocked on the door, and no one left a business card," says resident Rachelle Brown. "I think they did this in a very back-door way. I'm very disappointed in Matt Villa. And I voted for him!"
Villa, who has endorsed the project and plans to seek aldermanic approval that will, if necessary, allow for eminent domain to obtain the land. Villa did not return calls requesting comment for this story.
When the news broke, Dennis Smith, who's lived on South Grand for 27 years, hurriedly organized a neighborhood meeting with Robert Denlow, a high-profile Clayton real estate lawyer. Most residents attended, listening to Denlow tell them they'd never win an eminent domain fight with the city and might as well try to sell for top dollar.