Good morning.

We'll call today's housing urban development and zoning committee meeting to order.

Madam Clerk, please call the role.

Alderman Cone.

Present.

Alderwoman Sweit, sir.

Present.

Altawoman Keys.

Here.

Vice Chair Sonier.

Alderman Browning.

Present.

Alderman Aldridge.

Present.

Chair Clark Hubbard.

Here.

Vice Chair Sonyer.

We have six present.

We have a quorum.

All right.

With that, I'll accept a motion to approve the minutes from Tuesday, December 2nd, 2025.

So move.

It was moved by Ottawa and Aldridge and seconded by Otterman Browning that we accept the approval of the minutes for Tuesday, December 2nd, 2025.

Madam Clerk, please call the role.

Altum and Cohn.

Audible and sweitzer.

Aye.

Audible woman Keith.

Aye.

Vice Chair Sonier.

Altman Browning.

Aye.

Alderman Aldridge.

Aye.

Chair Clark Hubbert.

Aye.

Vice Chair Sonier.

We have six aye votes.

Great.

With that, we'll move forward in the agenda.

And we will recognize Altaman Aldridge for Board Bill No.

107.

Thank you, Madam Chair and members of the HUDS Committee.

Good morning and happy new year first HUDS Committee meeting of 2026.

Today I present to you Board Bill 107.

This is the extension of a current SID that is located at the 1100 block of Wash Av.

It is already a current seed, but we're extending it further down the block.

And with that, Madam Chairwoman, I do have two people here to be able to give more details on the extension and the importance of extending this seed out.

Great.

If you want to go ahead and call them up.

Good morning.

And if you can both raise your right hands and swear to tell the whole truth and nothing but the truth.

I do.

Thank you.

Please proceed.

Thank you, Madam Chair.

My name is Robert Clark.

I'm an attorney with Armstrong Teesdale.

Here on behalf of five of the six property owners that have executed the petition to amend the existing 1100 Washington Avenue Community Imperium District by expanding the boundaries and adding an additional project.

Those five property owners that I represent are all affiliates of Oliver Properties.

For the record, first I have several documents that I want to offer to the clerk.

We have the affidavits of publication in the single American showing that it notices.

Excuse me, Mr.

Robert.

Could you speak into the mic, please?

If you want to hold it, make it easier for you.

Yeah, thank you.

Thank you, sir.

We have the affidavit of publication in the St.

Louis American, which establishes the notice of publication being published.

We've got the um the U.S.

Postal Service certified mail return receipts as evidence the property owners within the district received certified mail notice of the public hearing today, as well as the affidavit of publication from the clerk of the board of Alderman showing that the notice was posted here at City Hall.

So offer those three items for the record.

As I indicated, this petition does amend the previously filed uh petition that was uh submitted in 2009.

This community improvement district was established by ordinance uh 68436 approved by the board of Alderman July 27, 2009.

The petition before the committee today and as part of Board Bill 107 uh seeks to alter the boundaries of the existing district to add eight additional parcels of property uh to add an additional project that is estimated at 500,000 over the next five years to extend the term of the district, which currently expires in 2049.

This would extend it to 2053, so four more years, and it clarifies the existing determination of blight that was made back in 2009, does not alter that determination whatsoever, uh, and it reaffirms the current term of the board of directors that currently serves on the CID board.

And it reaffirms the current term of the board of directors that currently serves on the CID board.

As I indicated, there are uh three parcels that are currently within the district, uh owned by two property owners.

Uh and again, we're adding um six additional properties, so a total of eight would be in the district.

Uh we do have a boundary map.

It's in the packet on page 38 of your PDF, but we can attribute that as well, um, which shows the existing boundaries as well as the additional properties to be added along Washington Avenue.

And the idea is that it will start to take up most of the additional block, both in the 10,000 block as well as some of the 11,000 block.

Uh the city register and the city councilor's office have both confirmed the petition meets the requirements of the CID Act.

Uh, it's been signed by 75% of the property owners within the district, and it represents petitioners, represent 95% of the total assessed valuation of the proposed uh expanded boundaries of the district.

Um at this point, um, just to clarify the additional project uh is really to seek to support business activity and economic development within the district.

Um when I'm completed my presentation, Craig Heller will talk a little bit more about the vision for that project.

Uh and as I indicated, we're looking to extend the boundary the term of the district for another four years, and uh not changing anything about the original determination of blight that would remain the same.

That's pursuant to a chapter 99 ordinance 60939 that was uh adopted prior to the formation of the original CID.

I'll turn it over to Mr.

Heller to give a little presentation on the uh timing and the scope of the additional project.

Uh good morning, everyone.

Thank you for the opportunity to say a few words.

I think Rob did a good job of uh explaining the technical side and the legal side of this uh effort.

Um yeah, I'm sorry, Craig Heller uh with Oliver Properties.

Um you may uh have heard about Oliver properties and our efforts along Avenue.

Um so we've been uh investing heavily in uh along the corridor.

We've purchased over, I think eight properties, invested about 120 million in the last uh two years.

Um these are mixed-use multifamily buildings that we uh improve the units, uh, amenitize the property, and uh bring really good management to it so that uh these properties can compete for tenants again as they're getting pretty uh tired.

So, but our effort really goes beyond well beyond just buildings.

Uh, we're taking more of a holistic approach.

So we're uh we're working to um activate street level spaces along Wash Avenue where there's been a lot of vacancy.

Uh we're also working on the street itself uh with uh uh getting new street trees planted and maintaining them uh working on sidewalk repairs and replacing bad uh bad street lights, that type of thing.

So it's really about trying to build a comprehensive uh complete neighborhood.

Uh and that's where this CID comes in.

Um, none of these dollars um that are collected by the SID will go into any of our buildings and the improvements we're making.

It's all about doing things with our uh partners in the community, the uh restaurants, the the retailers and such, where we can do joint marketing efforts and events and things that will really help rebuild Walsh Avenue as a vibrant place.

So I appreciate your uh consideration with this.

Um happy to answer any questions you have.

Anyone else you want to speak?

Okay.

Um would you like for us to ask our questions now or wait for it?

It's a public comment.

We do public comment then.

Okay.

Um if there's anyone that's signed up to speak on board bill 107.

Can you raise your right hand?

I can do it all at the same time.

Swear to say the whole truth and nothing but the truth.

Yes, I think thank you.

All right, we can go ahead and start with the leaf.

Mr.

Connolly.

Uh good morning, Quarterwoman um Clark Hubbard, members of the committee.

Thanks for the opportunity to testify today.

Um I am actually testifying with not undecided on this bill, um, depending on what changes may be made uh prior to it being voted upon.

Um so my first point is, and I've mentioned this before on other bills, even though this is not a site specific to one location, uh, one development.

I still feel that the city of St.

Louis needs representation on the board.

Um my suggestion would be to have someone appointed from the Board of Alderman, someone pointed from the Comptroller, and somebody pointed maybe from the collector of revenue.

Um I don't think anyone, it's again SLDC isn't involved here.

I I don't think anyone from SLDC should be serving on this board.

Uh item of clarification if when I finish my comments, was a new blighting study conducted to verify this area is still blighted.

Um it would seem that in 17 years since the inceptions of the CID and the amount of investment done by all of the properties and by earlier developers prior to that.

Um wouldn't that have alleviated the light conditions?

Um let's see.

The um uh another thing in terms of the city accountability, uh many taxing districts do not submit the budget to the Board of Oldman for approval on an annual basis.

I don't know if that applies to the 1100 Washington Avenue SID, um, but uh I think it would be helpful to mandate uh in the ordinance.

I mean it it's a state rule that people don't seem to follow.

So I think having that included in the or in the ordinance uh would be wise.

That's the end of my comments.

Thank you.

Do we have anyone online, Madam Clerk?

No, we do not.

Okay.

All righty.

We'll go ahead then and start with comments, um questions, Ottawa and Cone.

No questions.

Okay.

Automan Sweitzer.

Thank you so much.

Thank you for presenting and allowing me this opportunity to ask questions, um, Madam Sherwin.

Um the SID is in a few different SID boundaries, correct?

Or how many SIDs overlap here and and what coordination does this SID have with those SIDs?

Uh these boundaries are uh in the 1100 and 1,000 blocks of Wash Avenue.

So in that geography, um you also have the um the larger downtown uh St.

Louis SID community improvement district, which is all about clean and safe.

Um, and so we we partner with them on some things and uh coordinate our efforts.

There's also but they do not get into economic development.

Uh they don't get into some of the things that we'd like to do with marketing and building the Wash Avenue brand.

And then the um there's uh another SID, the Washington Avenue SID, it's really that's its DBA, it's really the downtown North SID.

Um, and their geography is a little different and goes further east, but they too are not really uh focused just on these two blocks and trying to build the Wash Avenue brand.

So again, we partner with them, we try to work in um lanes where things aren't you know, or they're not filled, and then coordinate our efforts best we can.

So those are the so this is uh a one percent sales tax that's existed since 2009, is that correct?

That's correct.

Just on those smaller parcels, yeah.

Sure.

Can you talk about some of the projects that you've completed in that time?

So we uh the the SID was uh put in place by uh the developer of the uh Vanguard and Copia buildings.

Uh we have subsequently purchased those in the last um two years, and therefore uh the SID is in our hands now.

Um I think of it initially the SID was envisioned by the developer to help pay for project cost.

Um we don't need that, and that's why we feel it's more important to put it into community efforts and as opposed to uh our our our buildings uh themselves.

So the there's a lot of things that aren't being done that could really help Wash Avenue, and that's that's what we try to do with uh this the SID.

So you can't speak to anything that the money has been spent on explicitly, just general project costs or debt or over the years there has money.

Over the last few years, there hasn't been much revenue from it, simply because you know, if there's no restaurants and such in the boundaries, there's no sales tax.

Okay.

Uh and there's a $500,000 project mentioned in the bill.

Can you talk a little bit more about that specific project?

It's it's not a real estate project per se, it's more this community effort where trying to um revitalize this portion of uh Washington Avenue.

And you anticipate spending that on you said marketing, or did you also say streetscape?

And so uh what that's this SID wants to do is really focus on the economic development apart, working with the restaurants and retailer on a joint marketing campaign, um, maybe uh some small neighborhood events and such that build the neighborhood again.

Um things that haven't been done in a while on Wash Avenue that we think will be uh um uh very helpful.

So you anticipate using is it sort of you're trying to use the one percent sales tax to get to a $500,000 amount?

Can you just talk about that overlap a little bit more?

That's over that's that's obviously over some years.

You know, this isn't gonna collect $500,000 in a year.

It's it's not near that.

So you have any estimates for each year?

Uh currently uh uh we we estimate this year if the expansion goes through it'd be somewhere between 60 and 70,000 dollars.

Okay.

Now if if more restaurants come, of course, that figure will grow.

How many storefronts is it that are empty?

Um we've got um a couple in the vanguard building.

Uh the copious space is empty, although we're gonna try to fill that with our food hall.

Uh the meridian there's two vacant there, there's two a couple vacant in the door sub.

Um, so there's probably six to eight that are vacant currently.

Okay.

Um thank you very much.

Those are my questions for now.

Thank you.

Audeman keys.

Thank you.

Um I have no questions at this time.

Thank you.

Adam and Browning.

Thank you.

Um so it's just to be clear, it's just the first floors of the building that are included in the SID.

In the that's correct.

In the expansion area, it's just the first floors.

Um the the when uh the developer did the buildings, the copia bin, the Vanguard building, Van Gore's an eight-story building, he did include, and that's currently what the boundaries are.

He did include the entire building, but the the expansion area is just the first floor.

And so you said the downtown North SID and the downtown SID, which this overlaps with mainly focus on streetscape building improvements, that kind of stuff, but they cover a larger footprint.

Much larger.

Yeah.

And so this is more abouting and is the idea the marketing is going towards filling these vacant storefronts is or like how how does this work?

Is it offering discounts on rents or getting you know helping lure in businesses, or what's the what's the kind of goal here?

It's not so much that Alderman uh the that we're gonna take dollars and and and feed it to uh a potential uh new tenants.

It's about the having the existing ones and the ones we can add, have uh um get more volume, do more volume because we're helping them with marketing and doing joint marketing and and seeing seeing that part of Wash Avenue being seen as a place where a lot of people want to come.

You know, you have if you can build a district, more people will come and and more uh everybody will benefit the folks out of the street.

Right now, a lot of them are just trying to hang on by themselves, and we'd like to change that.

So it's about you know drawing people to the area.

Is it gonna be used to say like throw street festivals or is it more just like getting the word out to what people know that hey, this area is active and we have businesses you should visit.

Yeah, it's it's it's social media, it's other types of marketing.

We may do a small event or two, but it it won't be anything major because obviously dollars I mentioned won't pay for that.

Now, if we want to if some of the other groups in the area want to partner on something like that, we may help with it.

But again, it's it's it's trying to fill lanes that aren't being filled currently and working with those other groups to get more done.

So part of my concern um is I think when I look at Wash Av and the amount of investment that's been done there over the last 20 years or so.

And don't get me wrong, I'm very very appreciative of the work that um Oliver properties has done and and that there's a lot of progress that's been made there.

But one thing that I've noted is that as the improvements got made, there didn't seem to be a budget for maintenance.

And so a lot of the stuff that was installed a couple decades ago is starting to look pretty rough.

And I I'd love to see, you know, kind of a refresh to help make that area seem like it's still being maintained at the level that I remember you know, 15, 20 years ago.

Um can but is that some is that what the downtown North Sid and the downtown sit are focused on?

And I I just well the uh the um when you say maintenance, are you talking about maintaining like the streetscape and all that or the buildings themselves?

I think the streetscape.

Yeah, yeah.

Yeah, the you know, we're we were uh fortunate uh years ago to be able to do uh you know the various phases of the Washington Avenue streetscape improvements.

Unfortunately, they weren't maintained well.

Um so that's we have a we also inherited a small transportation development district that also collects, you know, um, but that's a little different.

That's that's what we're using to spend uh dollars on the streetscape.

So whether that's clean in the sidewalks or planting new street trees or keeping them watered so that they actually live.

Things like that, um, some sidewalk repairs, again, all in concert with the other partners uh in this forestry division and uh uh street department.

But we're trying to collectively bring that streetscape back to a point where it it feels like it's somewhere you want to be.

That larger SID has got a big mission because they're their geography is so big.

Um, but they also uh are only like I said, clean and safe.

So um that mostly means the SID guides, uh the additional policing, they do the planters uh and the hanging baskets uh and the clean team.

Um that's probably the big ones that I could think of.

They don't plant trees.

They don't do marketing.

It you know, so there's some lanes we're trying to fill here if we can have the dollars available so that we can collectively um bring the streetscape back, do the marketing so more people come, more people come, that's more revenue, and we can hopefully rebuild uh what was you know what you remember was pretty strong yours.

So the transportation development district that exists here is really what is where that money goes towards that streetscape and is that I guess what I'm looking at is I saw an audit report from about 2014, I think, that rated the um the TDD there as uh the performance is poor, uh saying that they weren't you know documenting the the expenses they were making properly, that there wasn't uh a lot of accountability.

Uh I want to make sure and it and obviously when you look at the streetscape, that's evident too, right?

That the money has not been spent.

Uh so I I want this area to succeed.

Like I really want to make sure that there's uh investment going into the everything from the streets to the beautiful buildings on Washav.

Um and you know, the this being added on to the others in order to create marketing.

Um you said it's expected to generate about 500,000 over half a half a dozen years.

A half dozen years, but it goes out till 2053.

Yeah, there will be, you know, on a uh it'll continue those efforts will be necessary, I think on the long term to try to just like the loop does and South Grand does, they all work together on marketing and things like that to collectively they have more of an impact.

Um and to the speak to the TDD, we obviously weren't involved with the TDD in 2014.

Um back then I don't I don't know what they were doing, but I think the developer had hoped that would help just with his his improvements.

Um we again don't see that being necessary.

So we're using the limited resources that come in from the TD to plant a lot of trees and do the things that really hopefully will start to make a difference on Wash Avenue.

Okay, thank you.

That's all for my questions today.

Thank you.

Thank you, Madam Chairman.

Um I just only have a few questions they're very basic.

Um all the properties that are would would be being added in, are they all carry on their property taxes?

Uh yeah, they're as far as I know they are.

And none of them are designated as new sensor problem properties?

As what kind of problems?

Like new censor problem properties.

Oh no, no.

And um the board, the the board makeup is that that's been the previous makeup of the of the board.

That's the current what you see in there is the current makeup, which is uh there's five five board members.

And these are just individuals who have rows, just rows within the operations of it?

Yeah.

Okay.

Um and there's no like outstanding building code or health violations of the properties.

No, uh Oliver Property owns uh most of these.

Um there's uh two that aren't.

Um, but uh those those owners I've talked to, one is Joe Edwards, uh Dr.

Raman owns one of the spaces.

Both are in favor of what we're doing because I definitely see the need.

But um, no, there's there's there's everything is up to code.

Right.

There's some vacant buildings, so they're not uh our vacant spaces on the first floor.

So you know they'll need to be reoccupied and get new occupancy certificates and all that, but it's just the normal process.

Okay, thank you.

Thank you.

All right.

Uh the President Green.

Okay, all right.

Thank you, Madam Chair and uh members of the HUDS committee for your question.

Mr.

Craig kind of said a lot.

Uh I think how this uh SID on top of the other SIDs um can be able to benefit, especially when it comes to beautification.

I know the go as I've talked with, uh you know, very thankful for the work that Oliver properties have done.

Looking forward to the food hall that is coming to uh downtown.

We don't have a lot of spaces like this.

Hopefully, it'll be like a mini uh foundry where people can be able to walk, explore, and continue to uh appreciate the positive of downtown.

And I think hopefully with this expansion of the SID, this is not a uh new CID that we're creating.

This is already an existing CID, uh, that these funds could be able to, as Mr.

Craig said, be used to bring some beautification and do services that the downtown SID does not do, or that the North Side SID, which is a recent side that was made, uh does not do.

So with that, Madam Chairwoman, members of the HUDS committee, I would ask for your favorable consideration on board bill 107.

I accept a motion for board bill 107.

Yes, uh, I make a motion that we pass board bill 107 with the due pass recommendation.

Second.

Second.

It was moved by Vice Chair Say and seconded by Ottawa McClark Hubbard that we move board bill 107 with a due pass recommendation.

Madam Clerk, please call the row.

Audemic home.

Auto woman swipes, sir.

Okay.

Auto woman keys.

Aye.

Vice Chair Sonier.

Aye.

Altum and Browning.

Present Alderman Aldrich.

Aye.

Chair Clerk Hubbard.

Aye.

We have six eye, one present.

Is President Green on the vote?

She's not online.

Okay, I just didn't want to make thank you.

That will move forward in the agenda.

Recognize Otterman Browning for Board Bill.

Hello, and thank you to the committee.

Um so this is a bill that has been heard and passed before in this committee.

It's actually an exact copy of Board Bill 83, which passed uh on November 19th.

I reintroduced this bill uh as board bill 120 so that I could bring it back through committee to answer any questions as well as have SLDC here to answer any questions.

They weren't able to be there at the last committee.

Uh it's a unique funding mechanism, and so I just wanted to make sure that both the committee and the public got the right information and that we're being as transparent as possible here.

So CI Select, if you remember from the last bill, is a furniture company that is looking to relocate from the county into the city, bringing 40 or so employees with the potential to grow.

They are looking for uh to move into the old carriage works building on Wicklead Avenue, which has been vacant for at least 12 years, but I think maybe even longer.

Uh this building sits in the Cortex District, but it is not utilizing the TIFF that exists in that area for the rehab.

Instead, we're aiming to bring this old carriage works building back into life by diverting half of the sales tax from the sales made by CI Select into an account that the CompChor will control.

The Comptroller will then reimburse the company for build-out costs of the space up to a cap of a million dollars.

So while this incentive is act active, the city will continue to get the other half of the sales tax as well as the earnings tax from the employees.

Last time when I was in front of this committee, I incorrectly said that we were giving up the cortex part of the sales tax, but I've since learned that it's a little more complicated than that.

It's the city's sales tax that is being diverted into this reimbursement account.

But while Cortex has activated the RPA of the TIFF district where this is located, that half the sales tax will be considered surplus in the meantime until Cortex submits a detailed project plan that this board needs to approve.

So at that point, half the sales tax will be devoted towards whatever project Cortex has if this board approves it.

But in the meantime, the city will continue to get half the sales tax.

So, and then they'll also be continuing to get the earnings tax.

That was never going.

After this incentive reaches the $1 million cap, which we expect that this business will get to quickly because they're selling high dollar products.

They sell office furniture to companies like hospitals and schools, and so they sell a lot.

And the once they reach that million dollar cap, the city will get its half of the sales tax again.

This incentive is really to help the company move into an old historic but abandoned building.

The city would be foregoing a million dollars of revenue that we wouldn't get if this company didn't move here.

So this is really a benefit for uh the city and all of our taxing districts by helping revitalize an old building, moving a business from the county into the city uh and bringing new employees uh into the city who will be paying that earnings tax.

With that, I'm happy to answer any questions.

And I also have uh SLDC here to answer any questions as well as um the owner of the company, Claire Erker, uh, who has uh very graciously joined us again to answer any questions that thank you for your time and uh at this time I'll yield.

Thank you, Adam and Browning.

Did you want any of them to come up and speak first, or do you want to move to all right?

Um do we have anyone signed up for public comment for Board Bill 120?

Yes, we have two people.

Okay.

Yeah.

Raise your right hand, sort of set out to nothing but the two.

Thank you.

We can please.

Our first speaker is Dan Pate.

Hi everyone.

Thanks for allowing me to come.

Uh I I guess I misunderstood this was a I thought it was an earnings tax reimbursement program, only sales tax.

So then do the real property taxes and the 50% of the EATS, the earnings and activity taxes, um, go to the TIFF in Cortex, or is that going to the city as well?

I'm not understanding exactly what goes to the city and what doesn't go to the city to be reimbursed to the owner.

Um, the a couple things.

The the last time that this was done, uh the SLDC managed the reimbursement, not the Comptroller's office.

So I'm not sure if the agreement's going to be managed through SLDC.

They had an automatic passive approval approval process.

So a request for reimbursement would be submitted, and after 30 days, if it wasn't disputed or any questions asked, that was automatically approved.

So if you can imagine a request coming through for someone's reimbursement to be paid by the earnings tax or sales tax or whatever taxes would be going to the city, um, if that sits on Otis's desk for 31 days, or if we transition to a new uh direct executive director of SLDC, there could be shuffling and expenses that don't get reviewed get reimbursed.

So I I would I would hope we could put a uh non-passive, non-automatic approval process on the reimbursement here, and have somebody able to look at the receipts, verify the costs that they're valid, and I think that should be done through uh a board of alderment committee or or somebody that you know that is accountable to the public since this is public money that's gonna be going to a private company.

Um if somebody could um answer, is Cortex participating in a reimbursement of their portion of economic activity taxes, or is this going back to uh IDA, who's the holder of the TIFF notes now for the majority of the Cortex district?

The mechanisms are are a little bit hazy, so I would appreciate some clarity on it.

Thank you very much.

I appreciate it.

Thank you.

Just want to see if um we can get a quick.

We typically don't do it like this, but those were great questions.

We want to make sure we get them answered.

My name is Mark Spikerman, I'm outside counsel at SLDC.

Uh, do I need to be sworn in?

Or and if I forget to answer one of your questions, just interrupt me and let me know.

This incentive only refers to the sales tax generated by the project, earnings tax, property taxes, not affected.

It is in one of the RPAs of the Cortex District.

It's uh one of the RPAs that were activated most recently, and the redevelopment agreement that applies there says that those uh revenues will be surplused, meaning they'll be treated as if there wasn't a TIF until such time as Cortex has a uh detailed project proposal.

So for the time being, that means property taxes flowing to the city, the school just as if there were no TIFF earnings taxes flowing to the city just as if there were no TIFF.

The umce the uh Cortex does some development within that redevelopment project area, then it would start acting like a TIFF again, and you'd see property taxes and 50% of the economic activity taxes and used to reimburse uh core tax and sub-developers for redevelopment project costs.

Uh the uh Mr.

Pate mentioned IDA notes.

This has nothing to do with any existing notes or bonds relating to the cortex, all totally independent.

Um is there anything anything else?

Oh, the passive approval process.

Yes.

Uh similar to uh pretty much all redevelopment agreements in the city and honestly elsewhere in the state, uh, and in general fairness to our companies.

Uh there is a uh provision in here that says if the city doesn't proactively review the invoices and and they do have to provide invoices and detailed estimates, then it is deemed approved after 30 days.

Uh we we see that again with the city's TIFF projects and and other items.

Uh it's generally done administratively.

Um I haven't been aware of any issues with it.

Thank you.

I appreciate you allowing us to get those answers on record.

Uh is there anyone online signed up to speak?

We have no.

Honor McCall.

Oh, I'm sorry.

Thank you, Mr.

Kelly.

You can come on that.

Okay.

Um, members of the committee, thank you for the opportunity to testify again.

Um it would really be helpful if the legislation spelt out really clearly the issues that Mr.

Payton and Mrs.

Spikerman's response because it really board bill 83, the original version did not spell that out.

I have have to admit that I haven't read um current 120 in you know the complete form.

Um there's a spreadsheet that you've got to zoom in on to read as one of the exhibits um that does reference TIFF, and there's a one paragraph that references TIFF.

But again, it would have been very helpful to have that clarified really clearly in the legislation that this is in the St.

Louis Innovation District, TIFF, RPA, can't remember, four or eight.

Um, you know, because of this bill.

We're kind of I don't know.

It feels like we're setting it up to benefit the Cortex TIFF when I don't think incentives are necessary for this particular company to move into the city.

Um the company representative testified during Old Bill 583 that some of the salespeople, you know, earn you know $300,000 a year.

And for a net benefit to the company of a million dollars, I really don't think that makes the difference as an incentive.

Um a logistical item.

The notice for this meeting, the the agenda that's linked on the website as of like 8 30 this morning, doesn't the agenda that's linked only includes 107.

It doesn't include board bill 120, which is only on the calendar notice with the summary.

Um so technically speaking, kind of think you should hold the hold this bill today and then have it you know on an agenda at a future meeting and properly uh properly noticed.

Um let's see what are the other questions.

I agree, Mr.

Pate on the fact that there should be a non-passive approval process, uh, whereby city officials review those um submissions from the uh company proactively and you know the approval is the city official officials signing off on it rather than the potential for 31 days to a lapse and then the uh reimbursement happens automatically.

Um I think those are the main points.

So I encourage you to hold the bill today so it's probably noticed.

I do want to thank uh Alderman Browning as the sponsor for clarifying um the deficiencies in the previous bill.

Thank you.

Thank you, Mr.

Conley.

Okay.

All right, Altman Browning, I do have one question that got flagged that we'd like um to have it answered.

Well, maybe a LDC will SLDC um be ensuring the compliance on your bill and collecting and auditing the certified payroll.

This is noted in the um, I think it's exhibit E, I think was the Yes.

There is a uh the the board bill approves a uh development and performance agreement, and within that agreement, there's a requirement for an annual compliance report filed by the company.

And that that report uh goes to uh these so it will all file under is it all the prevailing wage will file under the compliance and the reporting.

Yeah, the comproller will also have a role with finances.

Okay, all right.

Thank you so much.

You say no questions.

Right, okay.

I don't want to miss weither.

Thank you.

I appreciate uh the chance to ask questions in the the presentation to clarify some of the things that um you know were or maybe not as clear at the last iteration of the board bill.

Um I do appreciate this sort of of structure in which they have to show the receipts before the money comes to them.

Um and I think that is a really a good structure and answer some of the questions that that we all have whenever there are sort of incentive projects that occur without having the ability for the city to see what's being spent on until the budget gets turned in if the budget gets turned in with some of these other ways that incentives happen.

So um I think I asked most of my questions in the last meeting about this about this topic, and uh I have no further questions.

Thank you so much.

Thank you, Adam Woman Sweiser.

Uh Ottawoman Keys.

Um, no, I don't have any other questions, but uh thank uh thank you, Alderman uh Browning for bringing um this issue back to the table for further discussion.

Thank you.

Alderman Aldridge.

Thank you, madam chair, members of the committee.

Uh echo my colleagues, thank you, Alderman, for bringing this back for the clarity.

Just one more time for the the record.

Um so in board bill is it 82, 83?

83.

83.

The funding mechanism for it was half of the funds that was generated from the TIFF would kind of be reimbursed.

Could you talk about that mechanism in this one just one more time?

It's a unique one, which I'm glad you're not tapping into the earnings tax, but the the previous one that is being held on the third recalendar, and then this new one that looks like it would be from city sales tax that functionally literally reading the bills.

There is no difference between the two bills.

Uh the the mechanism is the same in both.

It is simply that when this is before when 83 was before the committee, I missed uh, and that's what I wanted to bring it back through committee to correct.

And since it was on third reading, you know, it's a little difficult after it's been perfected to send it back to committees.

So I just decided to reproduce it and it makes more sense that way with our our structure.

But the way the mechanism works is it diverts half of the city's sales tax into this reimbursable account that the compulsor controls.

So the speaking of like should there should be an OYT representative reviewing this, there is.

The Comptroller's office will be reviewing these expenditures, authorizing the reimbursement uh based off of their judgment on if it's a eligible cost.

Uh they will get one percent uh from this for their troubles.

So that amounts to about maybe 1500 a year.

Um, and I talked to the comptroller's office back when we first did 83 and again yesterday about uh this bill and their offices supportive and ready to do this.

Yeah.

And I remember just so on the record uh last time we talked.

I know you uh mentioned that you know this would be bringing jobs where it'd be around 85,000.

Um, and then found out that that would be the average.

So that there are, I think to one of the uh speakers that spoke, there are people that will be making maybe roughly a hundred something uh thousand, and there will be low-wage workers making 45,000, and with all those employees, it would average up to 85.

So there's gonna be some people making some big bucks and some folks on the the lower end um that will add up to 85,000.

So this isn't each person that will be working this facility will be making 85,000, correct?

That's correct.

That's how the the average works.

It's it's I believe last time and and Claire, if you'd like to clarify, I believe the lowest salary that they pay is around I would say very little is five.

You have to speak to the mic mail.

And you could introduce yourself.

Uh Claire Erker, CEO of CI Select.

So we probably have three people that are between 45 and 50 from there, I would say were it 60 to 65 and above.

And the highest makes about the highest would be our sellers, and that's a complete variable.

Um it's a straight commission-based salary.

So it they can be anywhere from 80 to on a really good year, 350, but it's solely based on what they're selling.

Gotcha.

And um, I guess my concern, and I've brought this to the Alderman before the meeting and said he'll get some answers or figure out what need to be scratched out.

The reimbursement project costs.

So on page two, I guess, of the agreement, things that could be potential reimbursement.

And maybe there's also SODC question.

When we do these incentives, and I know this is a new one.

Have we ever, I guess, what concerns me is the C, you know, being able to reimburse for professional services, including but not limited to architecture engineer, legal, marketing, finance, planning, or special events.

It seems like we'll be reimbursing for one of the things I think marketing.

So we're we're re you know, giving you guys back to do uh like free marketing or legal services.

Can you professional service, whatever that is?

Could you explain um Yes?

Uh I'm I'm happy to address that.

The um if you look into the uh intro of that definition, it says in connection with the work, and then the work is further defined as you know, actually building the building out.

Um so when you look at legal architectural engineering marketing, that's all has to relate to the actual construction of the project.

It's not you know, putting up a sidewalk sale or something.

It's like marketing would be putting up a coming soon sign because we're building a project that's coming soon.

Uh legal, there's all sorts of legal aspects involved with construction contracts and negotiation of this agreement, architecture, again, designing the building.

It it all has to relate back to the actual project.

Like the build-out.

Yep.

Is that like typical, I guess, that we do it or these um items or in typical like development uh incentive packages where these are used in other development.

Yeah, this is a pretty standard definition used.

Okay, I think at the moment that's all I got.

Vice Chair Snaya.

Thank you, Madam Chairwoman.

Umbers of the committee.

Um Altaman Brennan, can you just talk a little bit about the history of performance agreements and um you know, kind of why this this specific form was chosen?

Uh that's probably a good question for SLDC.

Um I I know that at least the history, how this came to me is that they came and said, you know, the company wants to move to St.

Louis, but this space that they're gonna move into is old, falling apart, and it needs to be built out.

And um, so it's it's it's kind of expensive for places to move into old buildings in St.

Louis.

It's much cheaper to move into like a newer construction spot out in the county.

Um, and so they said, what can we do to help this company make these costs work?

And I said, you know, I'd prefer not to give away the earnings tax because to me, getting jobs in St.

Louis means getting that tax.

Uh so SLDC went back to the table and found a uh different mechanism to use here.

And I think they did a pretty good job.

I'm pretty proud of what we've created here because it it does create a nice reimbursable model that is very accountable, uh, helps the company out, has a reasonable cap on it.

You know, we we talked about the employees that might make uh upwards of 300 on commission.

We should hope that they do because then they'll pay off this, they'll they'll reach that cap faster and the city will benefit faster from this uh if those if those sales go well, if this company does well, this incentive model should work itself out within six, seven years, which is much faster than most of our incentive models uh usually work out.

So that's kind of my history and how we came to it.

But uh, if if if you all would like to share any more about how you arrived on this particular incentive model, I'm sure uh that love to hear from you.

Good afternoon, Zach Wilson SLDC.

Uh we don't usually use this incentive model.

Uh that's why we have Mr.

Spikerman speaking on our behalf for the most part here.

Doesn't go through any of our boards also.

As the clawback here on this one is very upfront.

If they drop above 40 jobs, then some stops.

So that's uh performance model we have for this uh setup.

So it's pretty clear.

Uh so Mr.

Wilson, can you speak into the mic please?

Oh, sorry about that.

It's pretty clear the uh clawback is uh anything under four jobs, the incentive goes away.

Um, and that's why we chose that performance.

It's very upfront.

Happy to answer any questions.

Um, can I not sure if it would be Alderman or Mr.

Wilson, but can one of you all speak to the process?

Um the passive approval or non-passive approval that was mentioned in public comment.

Passive approval on which aspect.

I think they were saying that the way that their previous understanding was that if it was kind of automatically receipts and things were put into a system and it's then it automatically goes through.

Yeah.

Um, following completion of the project, the company will have to submit a certificate of reimbursable project costs with copies of all the invoices and other evidence of payment, lien waivers, everything all grouped together.

The city, SLDC and the computer's office, uh, then have 30 days to review it and provide any objection.

If they don't review provide any objection in 30 days, it's deemed in the city is the the city controller, the city is SLDC who's over who's reviewing at 30 days.

Uh Zach, I believe someone in your office looked at things, and then I'm not sure who in the controller's office.

I I can't speak for the controller, but it would be myself or Madeline Swanstrom and our compliance department for on my on my side, but on the controller's office could be someone under Ryan Coleman, perhaps.

And and I'll note uh I represent cities across the state on on projects like this.

Um this is 100% across the state done at the administrative level by staff, not by elected officials.

Uh in terms of just the viability, uh so I think like my understanding is basically the way that this will work is typically I know we do a TIFF, we give 50% that goes to the TIFF that is for improvements within that TIFF parameter.

And then the other 50% typically goes to the city.

Um, this is proposing that that 50% that will usually go to the city instead, you all are eligible to get reimbursed withstead of it going to the city up to the million dollars.

Okay, I'm trying to explain that well because I know people at home have questions.

So I hope that that answers it and explains it as best I can because I definitely got some questions.

But I think they just don't um typically understand the nature.

So I'm just trying to explain to the public that the way that it works, and this is usually the way it works for all TIFFs.

Anytime you see a TIFF approved is they have a parameter.

50% of those funds go into you can say sort of an account that can be used for anything kind of improvements within that perimeter at the discretion of the folks who are you know within that TIFF district.

And then the other 50% traditionally goes to the city.

In this case, this business is saying, hey, for all the things that are listed in our performance agreement, which the automated 14th mentioned, um, we would actually like to be reimbursed for that up to a million dollars instead of it going to the city and SODC is saying we support that because we support the creation of the 41 jobs um that will have an average of 85,000.

So I'm sorry, and I know I will have constituents that are gonna follow up if that's not confusing, but I'm trying to explain it as best I can and put it in Lightman's terms as best I can because I do know that these things are like very can be complicated, nuanced over folks' heads.

So I just hope that that explains it.

But I know my residents will definitely ask me more if they have more questions.

Um but along those lines, was there consideration at one point of taking the 50% from the TIFF district side instead of the city's side of the sales tax?

So we would have to get the Cortex District's approval to do that.

And at this time, they're saving that for an infrastructure project sometime in the future.

Uh that of course, in order to for that to happen for them to use that 50% towards that infrastructure project, they would have to submit a project plan to this board that we didn't have to approve.

So my question for them is going to be when they come, how is that infrastructure project being a benefit to the whole city?

Uh, because I think that's the question that will need to be answered.

Uh when we're looking at this though, until they submit that detailed project plan, that 50% that would typically go to the TIFF will be declared surplus and actually come to the city.

So uh this is uh a good situation where we're gonna continue to do that until this board.

Um I'm just looking at this model so the just so I'm clear, the the cloudback language in the bill is really just around it's just around the fact if those if they drop below that threshold for the jobs, that's the clawback in this bill.

The jobs and or if they for some reason leave the building.

And honor brandy, you're saying that the TIFF folks, you kind of did have a conversation, but they indicated that they want to save those funds for an infrastructure project soon to be announced, basically.

Yeah, I don't think it's necessarily soon, but probably in the next few years.

So like I said, if it doesn't, if we if we do this model and it goes six, seven years and they they have good sales, uh the incentive model will be paid off by that point, we'll hit that million dollar cap and all future sales tax revenues of of our half will come to the city.

But you you said you're unclear.

Your question for them is if they're the infrastructure improvements they're proposing are specifically within the TI TIFF perimeter or if they're larger than it.

Oh no, they have to be in the TIF perimeter.

But what I'd say is my question for them when they bring that detailed project plan forward is just how that improvement benefits the city.

Like uh is it you know, making improvements to the street, like I we're just talked about with Washav, you know, where it's gonna be of better benefit where it's gonna bring more business.

If you're familiar with this block right now, there's not a lot going on on this block.

It's a few warehouses, uh, the supply division has uh building there and the police have their uh repair garage there as well.

So there's and then there's several vacant lots that are just nothing's going on.

So um I think when Cortex looks to develop this, they'll have a plan that they'll bring forward.

But I I can't speak to that now because I haven't seen and I see in the model that we have, it shows that like model number one, if there's 20 million dollars in revenue, about 137, 500 per year is what they'd be reversed in.

Uh model two is if there's 420 million dollars in revenue, that's about 172,000, which would um the reimbursement would be about five and a half years.

Um, I'm just curious from you all, and I know you are a business, and so obviously everything is economic and changes, um, but my concern is knowing that in six to eight years, you guys will likely have pitch your million-dollar cap.

Um, what is you all's commitment to staying in the city beyond that once that cap is reached?

Good question.

I hadn't thought about it, but I would have no plans to move out of the city.

Um if it's working for us, which I am have all the confidence in the world that would.

Um, and I think I mentioned this the last time.

Uh my plan is also we've got a 50,000 square foot warehouse in our city, and that lease is up in two years.

So my plan would be to move that to the city as well.

So we're in a closer proximity to our warehouse as well.

So once we're here, I don't see us leaving.

I mean, my hope is we're sort of at the cusp of this area taking off and that we're gonna be a part of it growing and it just is gonna get better and be more bold in eight to ten years.

Um six to eight years of reimbursement is really silent.

But I just wondered too, when you guys were discussing your model, did you ever talk about the idea of spreading a million dollars like 100,000 over 10 years so that you would be here for 10 years?

And I'll might be an SLDC question.

But I guess my concern is just if we go through with this, I can understand the benefit and plus, but I just would imagine for members of the public that obviously you can't really have a business commit to staying beyond the period because who knows like what could happen.

But I just am curious about what assurances or protections we have as a city.

Um, and you know, how did that waiver into you all's decision making of this?

There is a second clawback.

I'll let Mr.

Spikeman speak on that.

If they do leave early, there's a penalty for that.

So I'll go into greater detail.

I was just gonna reference their lease.

Could you get on the leases for 10 years?

So uh they they will be there, and then the callback uh would be they'd have to pay back a certain amount they left early.

But I think all all signs are that they would be uh intending to stay and and even intending to bring more here.

Okay, all right.

Thank you.

All right, are there any anyone signed up online for Board Bill?

We have none.

You're welcome to close.

Well, thank you for the questions.

Uh I think they're really good questions.

I appreciate everyone's patience and bringing this back before the committee again.

Uh this is good work we're doing, and um I just ask for your favorable consideration.

Thank you.

But that I'll accept the motion for Board Bill 120.

Okay.

I move that we pass Board Bill 120 out of committee with a due pass recommendation.

Second.

It was moved by it was moved by Chair uh Clark Hubbard and seconded by Alderman Comb.

Madam Clerk, please call the roll.

Aye.

I did you get that aye.

Audible woman's white, sir.

Aye.

Audible Keys.

Aye.

Vice Chair Sonia.

Aye.

Alderman Browning.

Aye.

Alderman Aldridge.

Aye.

Tara Clark Hubbard.

Aye.

You have seven eye votes.

With that to successfully pass Ward Bill 120.

Are there any resolutions for review?

We have none.

Any committee discussions?

We have none.

Any written testimony?

We have none.

Any announcements?

All right.

All members were present this morning.

So with that, I'll accept the motion to adjourn.

Second.

It was moved by Vice Chair Saye and seconded by Alderman Cohn.

That we adjourn.

All in favor say aye.

Aye.

Aye.

Thank you.

Uh have a blessed day.