Aldermen deny reimbursement sought by Crestwood Kohl’s developer

‘Well, it stops tonight,’ mayor says of THF Realty’s requests

By BURKE WASSON

If the developer of the Crestwood Kohl’s store wants to be reimbursed for more project-related costs, Crestwood aldermen indicated last week that approval will not be forthcoming.

With a 5-3 vote on July 10, the Board of Aldermen denied a $44,601 reimbursement to THF Realty for business-relocation costs from tax-increment financing, or TIF, revenue generated by property tax at the Kohl’s site.

Board President Gregg Roby of Ward 3, Ward 1 Alderman Mac McGee, Ward 3 Alderman Jerry Miguel, Ward 4 Alderman Steve Nieder and Ward 4 Alderman John Foote voted against the additional reimbursement. Ward 1 Alderman Richard Bland and Ward 2 Aldermen Steve Knarr and Chris Pickel voted “yes.”

In April, aldermen approved a $295,000 reimbursement to THF Realty for the developer’s $850,000 purchase in 2002 of former Crestwood Swim Club property at Crestwood Point. That decision was approved by a 6-2 vote with Roby and Nieder opposed.

Because the Crestwood Point Transportation Development District Board of Directors denied an additional $37,000 in reimbursements to THF Realty in April, Crestwood Point TDD board counsel Robert Klahr of Armstrong Teasdale said the developer found a mechanism to be reimbursed for $44,601 in relocation costs.

The Crestwood Swim Club, a private entity, moved to its current site adjacent to the Crestwood Government Center in 2003. THF already has received approval of $2,233,000 in reimbursable costs from a maximum of $2.285 million in tax-increment financing, or TIF, assistance. Because that leaves $52,000 in eligible reimbursement expenses, THF had requested $44,601 of that to be reimbursed.

On June 26, aldermen killed a second reading of a bill to approve the $44,601 reimbursement with three “no” votes.

Under the City Charter, to adopt an ordinance, at least five of eight aldermen must vote in favor of it and at least one week must elapse between introduction and final passage unless an immediate second reading is approved by unanimous vote of the Board of Aldermen.

Roby, McGee and Nieder voted “no” on the bill’s first reading. Bland, Knarr, Pickel and John Foote voted “yes” on the first reading of the reimbursement bill. Miguel was absent from the June 26 meeting.

At that time, Klahr said — after Roby questioned THF Realty’s motives — that he believes THF’s request for relocation costs four years after the pool was moved is to recover the additional $37,000 denied in April by the TDD board. Miguel, Mayor Roy Robinson and City Administrator Frank Myers voted against that additional reimbursement in April. Ian Silberman of THF voted “yes.”

Myers, who has called THF’s reimbursement request “an eligible and legitimate relocation expense,” recommended that aldermen table the proposal so that it could be further studied in a work session. But Robinson immediately rejected Myers’ recommendation and said he would veto the reimbursement even if the board did approve it.

“I’m going to ask the board not to do that …,” Robinson said. “I object to the process that came to this committee, or this board, asking us to … the TDD board already rejected a request for the additional ($37,000) monies, but they (THF Realty) found another way to do it. Even if this passes, I intend to veto it because it is wrong. It would be wrong for me to reject on the TDD board and turn around and sign this bill under a different disguise. I will not do that. So, to table it, I don’t think we need a work session. I think we need to pass it on through … But I guarantee, I will veto it if it’s approved.”

But after Robinson voted in April to deny the $37,000 reimbursement to THF Realty, he said at the April 24 Board of Aldermen meeting that he actually believed the developer was entitled to more money than the $295,000 approved that night.

“They’re probably entitled to more than what we approved,” Robinson said April 24. “I think they’re probably entitled to a lot more than what we approved.”

And during the same April Crestwood Point TDD board meeting where Robinson and the board voted against the additional $37,000 reimbursement, Robinson told Silberman that despite his “no” vote, he believed that the developer is entitled to additional reimbursements.

“I really, in my heart, I really feel that THF deserves the amount of money that you’ve come up with thus far and probably this 30-some-thousand dollars that you’re asking additional … I really feel for THF. I really do, I’m telling you. I think you all got a bad, bum rap on this deal. I hope you learn from your dealings here in Crestwood.”

But Robinson still voted against the $37,000 reimbursement in April because he was not satisfied with the documentation for that request that THF Realty included in an affidavit.

The proposal rejected last week by aldermen also included the payment of legal fees to Armstrong Teasdale from TIF revenue once all TIF notes for the project have been paid. Klahr said since his work as legal counsel to Crestwood Point since 2004, his law firm is owed an estimated $44,000. He reiterated that Armstrong Teasdale would not bill the Crestwood Point entities until after its TIF notes have been paid, which he estimates should occur in 2009 or 2010.

Robinson said he supports the payment of legal fees to Armstrong Teasdale, but would rather see that payment considered in a separate bill instead of being attached to the $44,601 reimbursement bill.

“The real problem here is we want to make sure the attorneys get paid,” Robin-son said. “They tried to pull this in together awhile back. The attorneys need to be paid for their time as everyone on the TDD board thinks that.

“But I’m uncomfortable. I think it’s blatantly wrong for them to come in here and ask us to try to subvert direction and pay them for something that we’ve already turned them down for on the TDD board. So it’s unbelievable that we have to sit here and discuss this as we are.”

Nieder, frustrated that THF Realty again asked for reimbursement, said the developer should realize that aldermen are not comfortable with anymore payments.

“The board sent a message to THF with the $295,000 vote that this is it,” Nieder said. “There’s no more to be had. They seem to continue to find ways for years to try and receive as much money as they can. And we’ve asked them and stated to them that enough’s enough. But when is it going to stop?”

“Well, it stops tonight,” Robinson said.