The St Louis Contrarian

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

Archive for the category “Commercial real estate”

More Bad Business in St. Louis

St. Louis should be doing everything possible to help small businesses. The population had declined and the city as a whole lacks for good businesses. Instead the city is making it worse. They have decided to make things worse. In a small minded effort to get more tax revenue, the city has decided to reclassify many small businesses from retail to manufacturing. A good example is Crown Candy, an iconic business in the Old North St. Louis area. The reason for this reclassification, they have mixing bowls. Bakeries have been reclassified in a similar manner. Crown Candy in particular deserves the keys to the city not being treated in this rude manner.

To be successful, St. Louis needs to be the easiest city for small businesses to work, not the most difficult. 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:








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)]


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,

TIFS in St. Louis

I just read an article posted by Alderman Cara Spencer on facebook regarding the City of St. Louis financial position. The article quoted is entitled Team TIF St. Louis.

The gist of the article is that the city’s financial picture is dire and that TIF’s are the cause. As I have said previously, development subsidies are overdone in St. Louis mostly when used for projects that don’t further economic development. The analysis of TIFs is overly simplistic for the following reasons:

1. It is not really a debt. They are deferred funds that will eventually go to the city which are now going to developments.

2. Without the TIF nothing would have happened. It is not as if there would be a lesser project, there would be no project at all.

3. St. Louis is between a rock and a hard place. It is declining economically, riddled with crime and high taxes, and needs incentives to prime the pump. The real question is whether things will ever take off. Written by Paul Dribin

Development Subsidies in St. Louis

I attended a neighborhood housing board meeting in one of the neighborhoods of St. Louis recently. The group discussed a rehab job on a vacant house that will cost in the neighborhood of $250,000 to rehab and then sell for $120000. Development subsides will cover the gap.

This process makes no sense to me. I see the need for development subsidies in communities that are comprehensively redeveloping their housing stock and do not yet have housing values to break even in the process. These subsides should be limited to a reasonable percentage of the ultimate value. In the case I cited the subsidy of $13000 is more than the value of the property. This is crazy and it has been done thousands of times in St. Louis. Instead of comprehensive rehabilitation, aldermen or community activists pick out a property to rehab which has not overall effect on improving the community. Someone needs to take a good look at the whole process. Milwaukee where I previously lived and worked required that any housing with rehab costs higher than the end value be demolished. Written by Paul Dribin

The Aldermanic System in St Louis

Some of the recent controversies in the city, including support for the Blues Hockey Club and development subsidies are tied to a basic problem in St. Louis, the aldermanic system. The city has 28 wards geographically divided. These are the same number of wards for a city of about 320,000 as for when the city included 1,000,000 residents. Worse yet, the aldermen act as little dictators of their own turf and make all development decisions and pretty much approve all city spending in their fiefdoms.

HUD provides Community Development Block grant funds to the city. Every year the city takes those funds, which are intended to be used in the areas of greatest need and divides them 28 ways. Many aldermen have their own development groups rather than partnering with larger organizations.

It is no wonder so little gets accomplished in the city when you combine this system with the archaic further divisions with the Mayor and Comptroller. It is no wonder that an organization like the Blues does not get a clear signal of who is in charge. It is no wonder that St. Louis lags economically behind other cities. Written by Paul Dribin

Historic Tax Credits and Trump

President Trump has proposed in his tax plan to eliminate the Federal Historic Tax Credits. This would be a disaster for most cities, and most significantly, St. Louis. Federal and state credits have been effectively used in St. Louis for years to rehabilitate and develop housing that is historically significant. The dollar value has to be in the hundreds of millions of dollars. The value to the community is even higher. This for a tax plan that increases the deficit and simply lines the pocket of already very wealthy Americans. Second, this does not even get at the possible cuts in the State of Missouri Historic Tax Credits proposed by Governor Greitens Written by Paul Dribin

Office Space in Downtown St. Louis

The demand for office space in downtown St. Louis is decreasing. This problem will only get worse when Ballpark Village builds out their office space. It has always been a mystery to me when new space is built when demand is so low. St. Louis as of now has a declining market. Written by Paul Dribin

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