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The St Louis Contrarian

Providing Independent and Intelligent Insight on St. Louis Public Policy Issues

Metrolink Security

The rapid transit system in St. Louis known as Metrolink is an albatross. Mostly due to security concerns ridership is down and the operating deficit is increasing. The St. Louis Post Dispatch ran an article today about Metrolink which is quite disturbing. There is still no overall security plan linking St. Louis City, St. Louis County, and St. Clair County. The standards for policing these three jurisdictions are all different. The prosecutor in St. Louis County will not allow prosecutions for riders who do not pay fares. St. Louis City hardly provides any policing at all. Why are they talking about expanding a system that does not work now. Written by Paul Dribin

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Community Development Subsidies in St. Louis

Community activists are outraged by TIFs , tax abatement, and other forms of development subsidies in St. Louis. There is justification for these beliefs. Another development subsidy which is more pervasive is more damaging. This takes place with the development of affordable housing where block grant funds are used to subsidize the difference between development costs and ultimate sale price of a house. Back when I worked on loan to the city I saw numerous examples of developments that cost $300,000 and sold for $100,000. Block grant funds were used to write down the development cost in the hope these properties would stimulate community development. They rarely did, but aldermen thought they would. Where is the accountability for this disaster of a policy. Worse these policies are still continuing today. Written by Paul Dribin

New Market Tax Credits

St. Louis was recently awarded a large new slug of New Market Tax Credits. These credits are intended to enhance development in underserved economic areas. This is good news. Attached is the article:

Microsoft plans to anchor a new office and lab building set to open in mid-2018 in the Cortex technology district.


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The U.S. Treasury Department announced Tuesday that the city of St. Louis’ lead economic development arm would receive a $35 million allocation of federal new markets tax credit authority.

The award is part of $3.5 billion in federal new markets tax credits authority allocated Tuesday to 73 organizations. The credits are designed to spur more investment in low-income and distressed areas by reducing the risk. Local organizations awarded the tax credits authority offer it to investors to attract them to projects in certain areas. Qualified investments are eligible for a 39 percent tax credit.

The St. Louis Development Corp., which aids developers and other economic development in the city, has received nine allocations of new markets tax credits totaling $418 million since 2004. It received $75 million in new market tax credit authority in late 2016, which combined the 2015 and 2016 allocations. In the 2014 round, it received $45 million.

“This is fantastic news for the City of St. Louis,” Otis Williams, SLDC’s executive director, said in a statement Tuesday. “New Markets Tax Credits have been a tremendous tool for us as we seek to redevelop and strengthen the City’s low-income neighborhoods.”

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Otis Williams, executive director of the St. Louis Development Corp., in a portrait on Monday, Sept. 9, 2013, in downtown St. Louis.  St. Louis Development Corp. was awarded $45 million in New Markets Tax Credits. Photo by Erik M. Lunsford elunsford@post-dispatch.com

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Another local entity winning an allocation this year was U.S. Bank’s community development corporate entity, USBCDE, which was awarded a $70 million allocation. The U.S. Bank Community Development Corp. is based in downtown St. Louis. USBCDE invests in projects around the country, not just St. Louis.

Demand should be high for the latest round of credits, said Matt Philpott, who heads the new markets tax credit program at USBCDE.

“I would expect of this new round of award … most of that will get used in 2018,” he said.

The credits have been used to fund multiple developments in St. Louis, including the restoration of the Central Library downtown, the headquarters for the Big Brothers Big Sisters of Eastern Missouri in Grand Center, the Cortex tech district’s new office building for Microsoft and the ongoing International Shoe building restoration on Washington Avenue.

The credits were in danger of being killed in the original U.S. House version of the federal tax overhaul. But the Senate’s tax cut bill retained the credits for the next two years at existing levels. Philpott said Sen. Roy Blunt, R-Mo., helped keep the credits alive in the tax legislation.

More Scandal From County Executive Stenger

Steve Stenger and his cronies look more crooked every day. The Post Dispatch uncovered some emails which showed that county staff felt the new county buildings at the former Northwest Mall were a complete waste of money. This development is one which is being developed by a major campaign contribution to Stenger. I don’t know how one individual can be so tone deal. Written by Paul Dribin

St. Louis Airport Privatization Again.

In theory the St. Louis scheme to privatize Lambert airport could make sense. Of course we may never know because the whole system appears so rigged there will never be an honest evaluation of the pros and cons of the proposal. All the consultants, advisors etc. have a vested interest in making the privatization work. One thought sticks out to me. If the idea was a good one, why have private sector organizations not stepped forward sooner to make the privatization happen? Written by Paul Dribin

West Lake Landfill Cleanup

We have written previously about the problems associated with the West Lake Landfill near Bridgeton. Extremely toxic waste was dumped there at the time of the Manhattan Project creating the atomic bomb. Activists have been bringing action for years in an effort to get the site remediated.

The federal EPA has proposed a major but incomplete cleanup to the site. We understand they are proposing cleaning up 70% of the toxic site and removing the radiation. Environmental groups are looking for a more complete cleanup.

We regard these efforts as a good start but not enough. The whole site needs to be remediated and homeowners moved. Written by Paul Dribin

Hi Jinks Involving Stenger, Sheila Sweeney and Associates

Please read this excellent article by Tony Messenger from The Post. It outlines dirty dealing with Stenger and associates on contracts. Sweeney seems to be in on every crooked deal. Why has no one gone after her. Here is the article:

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Ask lobbyist Mark Habbas about the people supporting the ballot initiative he’s pushing to make medical marijuana legal in Missouri and he hems and haws.

“Various people” support the Missourians for Patient Care initiative, he says.

Push some more, and Habbas, the spokesman for the effort, offers a variant of the same answer.

“It’s people who are passionate about the medical marijuana movement.”

Why the secrecy?

It may have something to do with who is behind the initiative, their connections to one powerful politician, and their apparent plans to profit if the initiative ever becomes law. Two of the top officers with the Missourians for Patient Care initiative have received lucrative land deals or contracts with boards controlled by St. Louis County Executive Steve Stenger. The businessmen are big donors to Stenger’s campaign, and at least two of the county deals appear to have a connection to the marijuana business. The initiative, if passed, would grant Stenger wide powers to determine who gets the potentially lucrative licenses to distribute and sell medicinal marijuana.

Secret money

Habbas would not reveal board members of the nonprofit group that is funding the medicinal marijuana effort, but the initiative’s strategic plan, which has been given to some donors, lists all of them. The Post-Dispatch has obtained a copy of the plan.

The group’s president is John Rallo, a St. Louis businessman who has dabbled in insurance, nightclubs and the construction business for which his family name is most known. The vice president is Michael Kielty, a lawyer who was formerly involved with a different proposal to legalize medicinal marijuana, New Approach Missouri. The secretary is Corey Christanell, a former Anheuser-Busch executive, and the treasurer is former state Rep. Mike Colona, D-St. Louis, a lawyer who doubles as the treasurer of the political action committee by the same name as the nonprofit.

Of the three groups seeking to legalize medicinal marijuana in Missouri, only Missourians for Patient Care is shrouded in secrecy. The lack of transparency isn’t a bug, it’s a feature, built right into the material shared with potential donors. “No donor disclosure required,” reads part of the group’s strategic plan.

To date, the Missourians for Patient Care political action committee shows $117,000 in donations, all of them from the nonprofit with the same name. It is a common scheme used to conceal donor identities. Donors give to a 501(c)(4) nonprofit that doesn’t have to file campaign reports. The nonprofit then gives to the political action committee. In this case, the deceit goes a step further. The nonprofit recorded the gifts as “in-kind” donations, which means that the nonprofit is also paying all the expenses. That means it’s impossible for voters to know who is funding Missourians for Patient Care or how it is spending its money.

Habbas argues the secrecy is necessary. Despite the fact that 29 states have approved medical marijuana and others — including Colorado and Washington — have legalized recreational use, Habbas says donors are skittish. The other major medical marijuana initiatives are filing campaign reports naming their donors.

“We set it up that way because most people who are supporters of it don’t want to be known,” Habbas says. “They just want to keep their donations private.”

Some of them might have good reason.

Stenger connections

Three times in the past two years, Rallo has been involved in receiving sweetheart deals from St. Louis County boards appointed by or otherwise controlled by Stenger. In two of those deals, Christanell was involved. Together, the two men have given Stenger about $40,000 between their various business entities, which include companies that appear to have a connection to the marijuana industry. Both Christanell’s 3Gems Nutrition, and Rallo’s B&B Packaging Group, promote a product called “Heavy Boost,” which various recreational-pot-related publications say enhances marijuana growth.

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Last year, the St. Louis Economic Development Partnership that is run by Stenger ally Sheila Sweeney executed a nearly $500,000 loan to an investment group involving Rallo and Christanell for a building the duo own on North Warson Road. The primary tenant of that building is a hydroponic business.

Later that year, the two men were part of an investment group given a massively under-market deal by the St. Louis County Land Clearance for Redevelopment Authority for two properties in the Wellston area which, one of the investors said, could be used for a “distribution” facility.

And in 2016, the St. Louis Port Authority, also run by Sweeney, approved a marketing contract with a Rallo company worth about $130,000 for improving national perceptions of the Ferguson area. As the Post-Dispatch’s Jacob Barker reported Monday, about the only evidence of any work on the contract was an opinion piece written for an NBC News website by TV personality Montel Williams, who misspelled Stenger’s name in the commentary.

What does this have to do with medical marijuana?

That’s the business Williams is in. His company, Lenitiv Labs, lists Jonathan Franks as the company’s vice president for communications. Franks’ public relations company was referenced as a “national partner” in Rallo’s bid for the Port Authority’s marketing contract.

Three years ago, Habbas was walking Williams around the Missouri Capitol introducing him to lawmakers as he pushed a bill to legalize medical marijuana that bears a striking resemblance to the one he’s now pushing for the ballot. “I met Montel through a friend of his,” Habbas said. “John Rallo.”

Habbas, too, has a connection to Stenger. When the lobbyist in 2013 set up his own lobbying company, Habbas & Associates, it was Stenger, an attorney, who filed the paperwork with the secretary of state’s office. Stenger is still listed as the registered agent of Habbas’ company.

Most of the people involved with Missourians for Patient Care declined interviews. Lobbyists Steve Tilley and Travis Brown, both involved in the initiative, did not return calls. Neither did Colona, Rallo nor Christanell. Tilley is the former speaker of the Missouri House. Habbas used to work for his company. Brown is the founder of Pelopidas Inc., the firm that does most of wealthy financier Rex Sinquefield’s political work. The initiative lists the address and phone number of one of Brown’s companies on its campaign finance reports, and he appears on a video promoting the initiative.

Stenger also declined to comment, but he issued a written statement through a spokesman:

“While I know John Rallo, Corey Christanell and Mark Habbas,” Stenger said, “I have no connection to the Missourians for Patient Care organization or to any effort related to medical marijuana.”

Future profits

If the proposal becomes law, Stenger will be plenty connected.

Besides secrecy, the Missourians for Patient Care proposal has two elements that separates it from the other competing proposals: The proposal creates a local licensing authority, so that county executives and mayors will have power over choosing who receives licenses for marijuana dispensaries and distribution facilities. And it limits those licenses to about 1 per 100,000 population, so that those who obtain them can ice out the competition and increase profits.

Rallo and Christanell have already shown they know how to navigate the various boards controlled by Stenger to their advantage. Habbas appears poised to get in on the deal, too. In October, he created a limited liability company called IV ALIVE, whose purpose is to “buy and sell any products legal in the state of Missouri and to provide any and all services legally available in the state of Missouri.” One of his partners in the business faced felony drug charges in 2015 after Wentzville police found “several Mason jars of marijuana and some marijuana that was growing inside the house.” The charges were dropped on a deferred prosecution.

The attorney who filed the paperwork for Habbas’ new venture? The treasurer for Missourians for Patient Care, Mike Colona.

It’s no wonder he’s not returning calls.

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In 2015, ex-TV talk show host Montel Williams testified before a Missouri House committee in support of legislation to legalize medicinal marijuana. [Screenshot from video coverage by KTVI (Channel 2)]

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St. Louis County Executive Steve Stenger said he knows John Rallo “from the business community” and that “the Post-Dispatch narrative concerning my campaign contributions is misleading and tiresome.” Photo by Laurie Skrivan, lskrivan@post-dispatch.com

Let’s Get Priorities Right

I am constantly frustrated by the silly priorities of our region and the things we try to put effort into. The City of St. Louis is the murder capital of the country. Indeed some neighborhoods have a murder rate as high as the most dangerous third world countries. We have a huge amount of poverty, poor infrastructure, failing schools, poor public health, and a net loss of population. Our race relations are the joke of the country.

Instead of focusing on these issues we are concerned about Metrolink expansion, soccer stadiums, trolleys, and horse drawn carriages. Our government is hugely fragmented and dysfunctional. It’s no wonder we have problems. Written by Paul Dribin

Residency Requirements in St. Louis

A controversy is brewing in St. Louis about whether residency requirements should stay in place for city employees. The city is talking about easing or eliminating city occupancy requirements for employees. The reason given for this line of thinking is that positions with city government have been too difficult to fill due to the residency requirement.

Community activists are opposed to eliminating the residency requirement. I believe that the community benefits from having certain types of city workers living in town. Police officers and teachers are two professions that come to mind. On the other hand, the whole question is irrelevant if you can’t fill the job. What about a compromise that does not make residency a requirement but gives preference to city residents in hiring. Written by Paul Dribin

Airport Privatization Again

St. Louis Mayor, Lyda Krewson made an incredibly stupid comment the other day about airport privatization. She commented that is Lambert International Airport was privatized, more flights would return to Lambert. The Mayor fails to understand that airport size is a function of supply and demand. St. Louis has lost population, that is why flights out of Lambert are down. No organizational or ownership structure will change that. Written by Paul Dribin

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