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Tuesday, September 18, 2007

Baron May Seek Distressed Areas Land Assemblage Tax Credit Act; Discussion Needed

According to recent articles in both the St. Louis Business Journal and the St. Louis Post-Dispatch, developers McCormack Baron Salazar may seek the new Distressed Areas Land Assemblage Tax Credit for the massive Chouteau Lake and Greenway project that they have contemplated for nearly a decade. This possibility is based on the fact that the state Department of Economic Development considers the entire city of St. Louis a distressed area under the legal definition of the tax credit act. Thus, any project in the city that meets the tax credit's other requirements could qualify.

This probably isn't what the authors of the tax credit had in mind, but the use would not be a bad thing. After all, the connection between the south side and downtown historically has been weak due to the railyards and Mill Creek before that. While rail lines are important and could see greater use in future times, the visual and physical barrier along the southern edge of downtown is detrimental. On one side, we have downtown and its burgeoning vitality. On the other side, the strong historic neighborhoods of the near south side. Between, we have the rail yards, the anti-urban campuses of AmerernUE and Ralston Purina and countless marginal uses. Making connections across this expanse will be a huge and visionary undertaking.

According to Richard Baron of the firm, he and his partners already control 23 acres in the project area. The tax credit would allow them to acquire more. Their project is unlikely to involve any residential relocation at all, although it may eventually include eminent domain.

While perhaps not the most pressing need for urban development, the Chouteau Lake project could be very good for the city. The details need full and open discussion. That discussion would benefit from the participation of developer Paul J. McKee, Jr., who has big plans for the northern edge of downtown. Unlike Baron, McKee has not published any rendering or discussed many details of his project. McKee has stated that he wants to use the Distressed Areas Land Assemblage Tax Credit in north city. In fact, his attorney Steve Stone is credited with writing the first version of the tax credit act.

These two large projects on the edges of downtown could unite the central city to its neighborhoods. The Distressed Areas Land Assemblage Tax Credit could enable wonderful urban-scaled projects that resolve big, old problems in the city -- or it could enable years of neighborhood fear, deferred dreams and unfulfilled promises. Baron and McKee need to engage the public, each other, city planners and neighborhood leaders so that we don't let two good opportunities turn into huge failures.

7 comments:

Anonymous said...

And Baron's is not, I suspect, the only additional project considering the tax credit.

Anonymous said...

Where do you draw the line between developer's keeping their plans under wraps versus fully disclosing their intentions on future projects?

Given the difficulty associated with site acquisition during predevelopment, most developers are tight-lipped about project details until most of the plans are in place.

The idea that a public incentive program doesn't change a developer's desire to keep proprietary information proprietary.

There will be a time for public input, but it's not during a developer's internal predevelopment, site acquisition, and strategic planning phases.

Michael R. Allen said...

As soon as the first person realizes what a developer is doing, the public input process begins.

Besides, there are no secrets in development. DALATC addresses that fact by providing compensation to offset the rise in land prices developers encounter as news of their project spreads.

Anonymous said...

Michael is right. Public input is a political issue, not a technical issue required by the internal dynamics of a project. In fact, you can get a pretty good idea of what Baron is up to from a couple Google searches--including the sort of prospective land uses that have been unavailable on McKeeTown. If McKee intended to keep his actions secret, it was the worse kept secret for about four years. And he has been more than willing to pay price inflation as word has crept up.

LisaS said...

You know, 8:46, in a completely private transaction I might agree with you--the only public input should be what would ordinarily be required for any project--zoning, historic, etc.

But when public money is involved--and we're talking here about millions and millions of dollars of public money in these cases--there needs to be a more open, more inclusive process.

MBS's approach so far seems a pretty good model for how it should be done--let's see how it goes from here ...

Brian Boeckmann said...

I was doing some research on this proposal since I am again hearing rumblings about it. I first heard of it years ago and have been waiting for this development plan to wake up!

For years we complain that business and commerce is leaving the city. MODot complains that we must spend billions to improve highways and build new bridges for keeping the region viable for interstate traffic. Now we propose removing distribution infrastructure already existing. This is our urban asset and a strength not a weakness! It makes no sense to tear down and drown it.

I do not disagree that this area can use greenspace. The excessive parking lots and some suburban style office buildings can be sacrificed. However, the rail yards should be kept. This is a time when fuel prices are making rail freight a more attractive option. We should be considering how to capitalize on our rail infrastructure not destroy it.

Chris said...

I agree with Brian that we should not sacrifice railyard capacity in St. Louis. However, I read somewhere that the Railroad that owns the railyard said that the yard is way too large for its needs, even if demand increases. What about the possibility of renovating the railyards on the East Side to provide capacity for St. Louis?