JEFFERSON CITY — A move by a St. Charles County state senator to protect developer Paul McKee’s lender ran into a temporary roadblock this week, when a ÃÛÑ¿´«Ã½ lawmaker told him to stop meddling in city business.
Sen. Nick Schroer, R-Defiance, sought to make his proposal part of a larger banking bill, but Sen. Karla May, D-ÃÛÑ¿´«Ã½, vigorously objected.
“If you want to represent my district, I want you to move there and run for office and be elected by the people of that area,†May told Schroer Wednesday during a heated exchange on the Senate floor that addressed a range of issues, including gun violence and control of the city’s police department.
Schroer’s measure would force any redevelopment agency that uses eminent domain to also repay any outstanding loans on the property in addition to paying the landowner the land’s market value.
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His bill was filed after the ÃÛÑ¿´«Ã½ Board of Aldermen approved new eminent domain policies that give the city’s redevelopment arm the option to acquire nuisance properties and a large undeveloped swath of land near the new National Geospatial-Intelligence Agency headquarters.
Though McKee’s NorthSide Regeneration is not mentioned by name, the city’s action clearly targets NorthSide’s 1,500 properties in north ÃÛÑ¿´«Ã½, most of which have sat vacant for years. ÃÛÑ¿´«Ã½ officials worry that those properties are encumbered by too much debt to be redeveloped, stymieing efforts to revitalize the long-suffering neighborhoods surrounding the new NGA.
NorthSide’s lender for much of the land purchases over a decade ago was Franklin County-based Bank of Washington, whose leadership has strong ties to state GOP circles. It’s unclear how much of the debt remains outstanding now, but in 2015 the bank told the city that both it and McKee had invested “well in excess of $50 million to establish site control†of the NorthSide area.
Bank of Washington, represented by the same lawyers who represent McKee, already sued the city in 2018 over its decision to cancel NorthSide’s redevelopment agreement. A trial is scheduled for Sept. 30.
At the time he filed his bill, Schroer said it was inspired by the city’s recent action and didn’t dispute it was related to Bank of Washington’s outstanding loans.
It “will absolutely discourage future development†if cities don’t pay off debt owed on properties in blighted areas, Schroer said Wednesday. And financial institutions would take a loss as their clients go bankrupt.
But May said Schroer’s plan would usurp ÃÛÑ¿´«Ã½ city’s ability to deal with land that has been neglected for 20 years despite it’s being paid for in part with more than $40 million of state money under an old state tax credit program.
“These big-time developers come in and get millions of taxpayers money — millions — and do nothing to the land, and try to wait for some other things to happen in order for them to get a big payday,†May said. “And then large tracts of our community look like Third World countries.â€
“We have these people who acquire large tracts of land and hold on to it and desecrate communities until they are run down and still don’t do anything,†she said. “And so we need to be able to get those properties back so that we can build the community.â€
Neither May nor Schroer named McKee during debate on the Senate floor or when asked by the Post-Dispatch if the legislation and discussion dealt with the developer.
May told the Post-Dispatch her concern was local control over the eminent domain process and taxpayers footing the bill for irresponsible development practices.
Schroer told the newspaper his proposal is about broader issues of investment in blighted areas and problematic eminent domain policies.
On Thursday, the day after the heated exchange on the Senate floor, Sen. Mike Cierpiot, chairman of the Senate Commerce Committee, confirmed that Schroer’s legislation would get a formal hearing in his committee, an initial step in the lawmaking process. He said the hearing will be held April 9.
Senate Majority Leader Cindy O’Laughlin, who manages the flow of legislation through the chamber, interceded and asked Cierpiot to hear the legislation.
“Anybody that asks me, I’m willing to help them,†O’Laughlin said.
View life in ÃÛÑ¿´«Ã½ through the Post-Dispatch photographers' lenses. Edited by Jenna Jones.