Aldermen opposed to new pact for retail center standing firm

No reason to reconsider vote, Schlink tells Crestwood board.

By EVAN YOUNG

None of the Crestwood aldermen who voted against a new development agreement for the Sappington Square retail center see any reason to reconsider their position, a board member said last week.

With that in mind, the Board of Aldermen soon is expected to discuss with the Sappington Square Community Improvement District attorney what can be done about the CID, which remains in effect even though there is no development agreement.

Aldermen voted 4-3 on Sept. 28 to reject an ordinance approving a new development agreement between the city, the district, Pulaski Bank and Priority Property Holdings LLC, a wholly owned subsidiary of the bank.

Ward 1 Alderman Mimi Duncan, Ward 2 Alderman Chris Pickel and Ward 4 Alderman Deborah Beezley voted in favor of the bill. Ward 1 Alderman Darryl Wallach, Ward 2 Alderman Jeff Schlink and Ward 3 Aldermen Paul Duchild and Jerry Miguel were opposed. Ward 4 Alderman John Foote abstained. After the vote, Mayor Roy Robinson named Beezley and Schlink to an ad hoc committee to work with Pulaski Bank to iron out the board’s concerns with the development agreement.

“My report back is that we found no reason to reconsider our vote,” Schlink, who volunteered to represent the aldermen who voted “no,” told the board last week.

His statement drew a concerned response from Pickel, who noted the aldermen that voted against the ordinance Sept. 28 — notably Miguel — indicated that evening they weren’t totally opposed to a new development agreement but had issues with the one proposed.

“I guess my question is: Where do we stand at this point?” Pickel asked.

Robinson told Pickel because none of the opposing aldermen wanted to reconsider their “no” votes, “the item is dead. There’s no use discussing anything after it’s been ruled on.”

Pickel replied that he thought it was “highly unfortunate that we have duped a business developer.”

“And I think it’s a horrible statement for this city to make to any other potential business developers about moving to Crestwood,” he said. “I think it just shows that we’re difficult to deal with, and that you can’t necessarily believe what we’re saying.”

The original development agreement, which was approved in 2007, fell through late last year when the center’s previous developer, Sappington Square LLC, defaulted on a loan it obtained from Pulaski Bank for construction of the roughly $13 million redevelopment project. The bank foreclosed on the property and bought it at public auction in December.

The CID on the property, which began in 2008, remains in effect even though a new development agreement has not been approved. A one-cent sales tax continues to be collected on purchases made at Sappington Square stores, and the proceeds are placed in a special account. A five-member board governs the district.

The original development agreement allowed Sappington Square LLC to request up to $2.5 million in CID proceeds to reimburse certain project costs. But while the developer completed some construction on the property, it missed a July 2008 deadline to request reimbursement, and none of the CID proceeds have been spent on the project. About $47,000 is in the CID account.

Under the agreement aldermen rejected, Priority Property Holdings would’ve completed the redevelopment. The agreement would’ve given the developer two years from the effective date to begin construction on the project and three years from the effective date to substantially complete it.

Pulaski Bank attorney Kevin King has said the bank wants to fill the vacant lots at Sappington Square as quickly as possible and eventually sell the property to a new owner. A new development agreement would help that effort because the bank could use CID proceeds to “incentivize” prospective Sappington Square tenants with lower rent, King has said.

Aldermen in July approved a conditional-use permit to construct a Fifth-Third Bank at the center.

Duncan told the board last week even though aldermen defeated the proposed new agreement, she believed there was “some room” to consider a revised document with “different terms that might be a win-win for the city and for the developer and for the citizens of Crestwood.”

“I’m a bit disappointed that that was not the path that was taken by the ad hoc committee, and I thought that was sort of the charge of that committee,” Duncan said. “And if I misunderstood, I’m sorry, but I would have thought that there was room for some other agreement — not the one we had — but one that would help both the city and the developer.”

Robinson said he, too, thought the ad hoc committee was going to sit down with Pulaski Bank representatives to come up with a new proposal.

“Evidently, they didn’t want to discuss it. I don’t know what the reasons were that you didn’t,” he said, and then asked, “Did you discuss it at all, on any of the provisions that you were against in the agreement? Did you have actually a formal meeting or did someone just call you on the phone and say: ‘I’m not gonna change my vote?”’

Schlink replied, “It was discussed, and … it was determined by the individuals that there was no reason to consider the vote.”

“Well, can’t pistol-whip people I guess,” Robinson said.

Beezley, who represented on the committee aldermen who voted to approve the new agreement, said she also thought the board wanted to work collaboratively on a revised agreement and that “it’s tremendously unfortunate that we can’t work collaboratively on this.”

Foote, who abstained from the Sept. 28 vote because he wanted both the board and Pulaski Bank’s views on the agreement clarified, said last week he was disappointed none of the four “no” votes wanted to reconsider. Given recent projections that show a continued decline in Crestwood’s sales-tax revenue, the city is not in a position to turn down businesses and developers, he said.

“Turning our back on them and saying ‘no’ certainly is our right, but it is not going to help us when we start trying to figure out how to run this city and bring in sufficient operating funds,” Foote said.

Robinson noted that Foote contributed to the agreement’s defeat by abstaining.

King, representing Pulaski Bank, said he was disappointed in Schlink for not attempting to get together with bank officials to work out his and other aldermen’s concerns about the new agreement. He reiterated that the CID will continue regardless of whether there exists a mechanism to disburse the revenue generated by the sales tax. Officials have said if the city and bank can’t reach an agreement about the future of the CID, the matter may be decided in court.

“Let me plant a seed of thought in your minds before you go down this road …,” King said. “The last thing that I want to happen, the last thing that I think the city wants to happen, is for a judge to decide where these moneys go …”