Two ordinances voided; two counts remain in Sunset Hills’ suit

By BILL MILLIGAN

Though two Sunset Hills’ ordinances related to the Novus Development Co’s. proposed MainStreet at Sunset were declared void last week, two counts of the same lawsuit filed against the city still are pending.

St. Louis County Circuit Judge Gloria Clark Reno ruled Jan. 30 that the city’s Board of Aldermen did not comply with state law last May when it adopted the two ordinances — one that approved tax-increment financing for the developer and the second designating Novus as the developer for the project.

“This is vindication for many of us who thought this process was flawed from the beginning,” said Will Asch-inger, one of the plaintiffs in the lawsuit and a spokesman for an organization opposed to the project called Stop the Sunset Hills Land Grab.

“It is now time for the mayor and other city officials to begin the healing process by reinvigorating the Sunset Manor subdivision and re-establishing people’s homes and property rights to rebuild their neighborhood,” Aschinger added.

Sunset Hills aldermen in May approved Novus’ request for $42 million in tax-increment-financing assistance and $20 million in transportation development district reimbursements to help fund the Novus Development Co’s. MainStreet at Sunset, a $165.2 million lifestyle shopping center at Interstate 44, Watson Road and South Lindbergh Boulevard.

The project would raze 254 homes and several businesses in the Sunset Manor subdivision. Only the Hampton Inn and Denny’s restaurant would remain. The Board of Aldermen also authorized the use of eminent domain to acquire those properties Novus does not have under contract.

Closings on the more than 200 homes were scheduled to begin Aug. 22. But Novus learned Aug. 18 its lender had withdrawn its funding for the development and the closings were delayed until a new lender could be secured. Since then, Novus has continued searching for financing, but has been unable to find a new lender.

In December, the Board of Aldermen voted unanimously to refer the development back to the city’s TIF Commission, which will consider changes made to the proposal after a public hearing conducted last March.

Opponents of the redevelopment project last summer filed two lawsuits against the city of Sunset Hills. Since then, several other suits have been filed.

One of the lawsuits filed last summer names 11 Sunset Hills residents as plaintiffs and seeks to have the city’s Board of Aldermen consider initiative petitions to repeal two enabling ordinances for the project. If the board fails to repeal the ordinances, the suit seeks a public vote to repeal the enabling ordinances.

The second lawsuit filed last summer names as plaintiffs Sunset Hills residents and commercial property owners along with Missouri Residential I, an affiliate of Westfield America Inc. The lawsuit contends the city violated the state’s TIF statutes and the U.S. and Missouri constitutions in approving the TIF assistance and redevelopment agreement.

The second lawsuit is the one involving last week’s ruling. In her ruling, Reno found that a cost-benefit analysis prepared by the city’s consultant — Peckham Guy-ton Albers & Viets Inc. — and presented to the city’s TIF Commission did not contain sufficient information from Novus “to evaluate whether the project as proposed is financially feasible” — a violation of state statute.

The lawsuit contended that the city did not conduct a second public hearing after “substantial” changes were made to the redevelopment plan, including the addition of 61,000 square feet of commercial space, several buildings and a movie theater, four new parking structures and an extension of the entrance ramp from Lindbergh Boulevard to Interstate 44.

Under state law, only minor changes may be made to a redevelopment area, otherwise the changes must be resubmitted to the TIF commission.

Reno’s ruling found that before the Board of Aldermen adopted the two ordinances, “substantial changes were made to the nature of the redevelopment project, but the project was not resubmitted to the TIF Commission for a new public hearing” — a violation of state statute.

“Therefore, because defendant did not comply with Missouri statutes when it enacted ordinances Nos. 1590 and 1591, the city exceeded its power to enact ordinances and said ordinances are hereby declared void and unenforceable,” Reno stated in her ruling.

Reno’s ruling did not address two other counts of the lawsuit. One of those counts contends the enactment of the two ordinances was “arbitrary, capricious, and/or unreasonable … because the board completely ignored the recommendation of its own TIF Commission that the redevelopment plan and redevelopment project not be approved and did not even discuss the recommendation at the May 10, 2005, board meeting …,” the lawsuit states.

The other count alleges that the ordinances adopted by the Board of Aldermen violated the “public use” requirements of the federal Takings Clause of the Fifth Amendment to the U.S. Constitution and provisions of the Missouri Constitution and violated federal and state due process clauses prohibiting the deprivation of any person’s private property without due process of law because “said ordinances permit, authorize and enable the taking of plaintiff’s private property solely for private use without any public use, benefit or purpose …”

The lawsuit contends the ordinances in-corporated a finding by the city’s planning consultant that Sunset Manor was a “conservation area,” which is required for the adoption of a redevelopment plan, even though Sunset Manor did not meet the definition of a “conservation area” under the TIF law.

Under the statute, a conservation area is “not yet blighted but is detrimental to the public health, safety, morals, or welfare and may become a blighted area because of any one or more of the following factors: dilapidation, obsolescence, deterioration; illegal use of individual structures … A conservation area shall meet at least three of the factors provided in this subdivision …”

The lawsuit states that the Sunset Manor has been subject to growth and development, which should continue with no need to adopt the TIF. TIF statutes prohibit the adoption of a redevelopment plan when the area as a whole has been subject to growth and development, the lawsuit states.

Sunset Hills City Attorney Robert C. Jones told the Call Monday that he had not yet discussed the ruling with Mayor Jim Hobbs and the Board of Aldermen.

“One of the problems with the ruling is it’s not final …,” he said, noting that two counts still remain to be addressed by the court.

Given that, the standard 30-day period in which to file an appeal does not come into play because the ruling is not considered final for the purpose of appeal, Jones said.

Asked if the ruling would impact the board’s decision to refer the project back to the city’s TIF Commission, Jones said, “… Obviously I think it impacts it, but I’m not sure how because as I said since we don’t have a final judgment it’s hard to say and I’ve really got to talk to the mayor and the board …”

The Board of Aldermen’s next regular meeting is scheduled for Tuesday, Feb. 14.