Aldermen to eye measure establishing new development pact for retail center

‘… I’m telling you, sit down or leave,’ mayor tells Nieder.


Crestwood aldermen again will consider an ordinance establishing a new development agreement for the Sappington Square retail center.

Mayor Roy Robinson broke a 4-4 tie after a lengthy and contentious discussion last week to approve Ward 4 Alderman Deborah Beezley’s motion to move forward with the agreement.

Opposed to the motion were Ward 1 Alderman Darryl Wallach, Ward 2 Alderman Jeff Schlink and Ward 3 Aldermen Paul Duchild and Jerry Miguel.

The Board of Aldermen is scheduled to consider the ordinance establishing a new development agreement for the retail center when it meets at 7 p.m. Tuesday, April 26, at the Crestwood Government Center, 1 Detjen Drive.

At issue is the community improvement district, or CID, currently in place on the Watson Road shopping center.

Some aldermen are at odds with owner Pulaski Bank over whether the board should approve a new development agreement for Sappington Square, or whether the 1 percent CID sales tax collected on purchases made at the center should be repealed.

The original development agreement fell through in 2009 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 2009.

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.

The same four aldermen who last week opposed moving forward with a new agreement also voted in September against a similar proposal.

That measure failed 4-3 with Ward 4 Alderman John Foote abstaining because he wanted more clarity on the issue.

An ad-hoc board committee subsequently formed to develop the “pros and cons” of having a new agreement.

Aldermen eventually directed Robinson, City Administrator Jim Eckrich and City Attorney Rob Golterman to meet with Pulaski Bank to discuss possible modifications to the original proposal.

The new proposed agreement is expected to include four changes from the one rejected last fall:

• All references to eminent domain will be removed. Some board members took issue with Pulaski Bank being able to seek eminent domain from the city to obtain cross-access from Sappington Square to Schnucks. Under the new proposal, if the bank can’t obtain cross-access in good faith, the matter will be considered closed unless later addressed by the city.

• The amount of reimbursable project costs from CID sales-tax proceeds to the developer will be reduced to $1.75 million from the original $2.5 million.

• The CID term will be reduced to 15 years from the date Crestwood and Pulaski Bank sign the new development agreement. The term initially was 20 years, making the earlier repeal of the sales tax a “substantive concession” by Pulaski Bank, Eckrich wrote in a memo to the mayor and board.

• A new provision will require Sappington Square to either obtain a 50-percent occupancy rate in sales-tax generating retailers for at least one day or generate $5 million in retail sales over one year. If neither requirement is met within five years of the new agreement’s implementation, the 1-percent sales tax will be repealed within 72 months of the new agreement.

The fourth provision also “is a substantive concession by the bank and would guarantee a more successful retail shopping center within five years, or result in the termination of the tax,” according to Eckrich.

However, Miguel contended at last week’s meeting that none of the four proposed agreement modifications should be considered as substantive concessions by the bank.

“This in no way can be considered the best and final offer,” Miguel said of the proposal, which at one point he unsuccessfully motioned to table. “This is an opening offer in an attempt to negotiate. It’s a very weak offer and to go forward with this just totally baffles me. We’ve gone from a … 60,000 square-foot project, 75 percent of which is supposed to be retail — in other words 45,000 square feet of retail — and we’ve reduced that to a project with a total of 36,000 square feet, of which 50 percent would be retail.

“That’s 18,000 square feet down from 45,000 — a reduction of 27,000 square feet of retail, a 60-percent reduction. Why don’t we just give the city away?”

King told Miguel the proposed agreement was not an “opening offer.”

“A very great, good deal of consideration went into this … before these concessions were offered as part of an effort to try to resolve this without litigation,” King said. “So let me assure you that this was not a cavalier decision or an opening offer as you suggested, Alderman Miguel.

“I want that to be clear for the record. So don’t try to suggest to the board that this is some sort of game that we’re playing back and forth to better position what you believe is in the city’s best interest. That is simply not the case.”

He later added, “Whatever the board does with this, we have literally beaten this issue to death and if the board chooses not to ultimately approve a renegotiated agreement, so be it. This continued discussion is becoming absurd.”

Discussion of the issue became heated at one point when former Ward 4 Alderman Steve Nieder suggested to King that the CID sales-tax rate be reduced.

Robinson intervened and attempted to end the conversation.

“I’m not finished,” Nieder said.

“You’re finished. Sit down, and if you don’t I’ll have you sit down,” Robinson said.

“I will not. I was just throwing out a suggestion,” Nieder said.

Robinson gestured toward the police officer behind the dais and said, “Will you have this gentleman sit down, sir, or take him out of the room? I’m telling you, sit down or leave. That’s the order.”

The officer and police Chief Mike Paillou walked Nieder back to his seat, at which point resident Don Clark stood up and said, “Well, I guess I’ll go, too. Sell us out, Roy.”

Robinson said, “Go ahead.”

Nieder said to Robinson, “You know, you’ve become a real belligerent guy …”

Robinson said, “Well, when you have to deal with people like you, you have to …”