Group says it lost TIF battle but will win war

Adolphus Busch IV acknowledges his environmental group lost its legal battle to prevent the city of St. Peters from using tax-increment financing (TIF) to subsidize development in a floodplain.

“Ultimately, however, I think we’ve won the war” as regards turning public opinion against the use of TIFs in floodplains, he said. Busch is a former chairman of Great Rivers Habitat Alliance and he continues to sit on its board and serve as its spokesman. Few people now believe government should subsidize developers’ projects in floodplains, he said.

That may be, but it won’t prevent the city from creating another TIF if it’s deemed necessary, said St. Peters Mayor Len Pagano. He said the courts have acknowledged the city followed state TIF laws.

“We will continue the use of TIFs and other economic development tools as we move forward in the future,” he said.

The Missouri Supreme Court last month refused to consider an appeal of lower-court rulings that upheld the city’s use of tax-increment financing to subsidize development in the Premier 370 Business Park. Great Rivers and St. Charles County government challenged the legality of the TIF.

The state’s high court let stand a ruling by a three-member panel of the Missouri Court of Appeals Western District that unanimously agreed with the city’s position that the site in question was blighted because of flooding and other factors. Much of the land, located off Highway 370 near Interstate 70, was in a floodplain. A levee was built to protect the business park.

Busch said that while they lost the court battle, his group’s message is getting through to developers and to the public. “Public education will be the key going forward,” he said.

In that regard, Busch said Great Rivers is transitioning. “I don’t think we’re going to be as action-oriented as we were in the past,” he said. By that, he meant the organization will be less likely to file lawsuits.

Instead, Busch said Great Rivers is looking to work with other groups to get the message across that subsidizing development on farmland and in floodplains is not productive in the long run.

Asked if his group would lobby state legislators during the current session of the General Assembly, he said, “We haven’t gotten that far.”

Busch said he had no problem with TIFs if they are used correctly. “They have worked very well in urban zones,” he said.

St. Charles County Executive Steve Ehlmann declined through a spokeswoman to comment on the Supreme Court’s decision.

Pagano called the Supreme Court’s decision not to take the case “tremendous news” for his city. He wants the business park to become “an economic engine” for the entire region.

Pagano is hopeful that with the conclusion of the legal battle, employers will be more willing to consider the business park as a site for their facilities. “The validation of this TIF can now offer new prospects for commercial development a path for obtaining financial assistance for new projects,” he said.

A TIF district uses some tax revenue generated by new development to help pay for related infrastructure costs.

Even with the TIF in place, the business park has had a difficult time attracting developers, presumably because of the weak economy. Trucking company Dayton Freight is the only employer with a major facility in the 850-acre business park. Dayton opened a 51,000-square-foot distribution facility there almost two years ago that employs close to 100 people.

The city opened Lakeside 370 Park, which adjoins the business park and includes a 140-acre recreational lake, in May 2011.