Preservation Research Officeby Michael R. Allen
by Michael R. Allen
Today Missouri State Representative Steve Hobbs (D) and Sam Komo (R) introduced HR 2399, a bill which would implement Democratic Governor Jay Nixon’s proposal to limit issuance of all economic development tax credits to not exceed seventy percent of the total dollar amount of all state tax credits redeemed during the fiscal year ending on June 30, 2009 and hand over discretionary allocation power to the Department of Economic Development. The bill would implement the policy effective July 1, 2010 and would greatly limit usage of the state historic rehabilitation tax credit as well as the low income and brownfields credits.
The bill is referred to the Job Creation and Economic Development Committee chaired by Representative Tim Flook (R).
by Michael R. Allen
On March 28th, the blog The Adventures of Johnny Northside carried the post “Historic Rehab Tax Credit Means JOBS!”. Fine, but is another blog calling for saving the Missouri historic rehab tax credit worth mentioning?
Well, the The Adventures of Johnny Northside blog is published by a resident of Minneapolis, and he is calling for Minnesota to enact a historic rehabilitation tax credit. And Missouri’s 25% credit is cited as a model.
by Michael R. Allen
The Missouri Growth Association has released An Evaluation of the Missouri Historic Preservation Tax Credit’s Program’s Impact on Job Creation and Economic Activity Across the State, a 34-page report by Dr. Sarah Coffin, Rob Ryan and Ben McCall of St. Louis University.
According to the report, the tax credit is responsible for 43,150 new or retained jobs with an average salary of $42,732 as well as $669.8 million in new sales/use and income tax revenues to state and local government.
The report confirms advocates’ assertions that the credit enjoys wide usage and largely benefits small developers. Coffin and company found that, as of 2009, the range of historic rehab tax credits issued goes from $399 to $20.1 million.
About 33% of the projects that have received Missouri historic rehab tax credits have used less than $50,000 in credits. Taking the number up to usage of $100,000 or less, there is a majority of 57% of projects. Less than 13% of projects used more than $1 million in credits.
by Michael R. Allen
In January, the Federal Reserve Bank of St. Louis posted this video of a bus tour of affordable housing developed by the St. Louis Equity Fund (SLEFI). SLEFI President John Wuest led a tour that included south city, the Loop, Hillsdale, north St. Louis and downtown. The majority of the projects included are rehabilitation of historic buildings that leveraged state and federal low income housing tax credits with state historic rehabilitation tax credits.
At one point during the tour, Wuest said that after several projects in one area there can start to be serious impact. That’s a realistic approach that differs from the large-scale urban renewal projects that have failed again and again. Yet the project-by-project effort to create a community impact is difficult to finance, especially if the end product is affordable housing. The recession has made the work even harder, but changes to the tax credit programs that make this work possible would be disastrous.
by Michael R. Allen
San Luis Apartments
On May 5, the Eastern District of the Missouri Court of Appeals will hear the Friends of San Luis, Inc. v. The Archdiocese of St. Louis. (Disclosure: This writer is president of the Friends of the San Luis.) The Friends of the San Luis sought an injunction against demolition of the mid-century modern San Luis Apartments so that it could appeal Preservation Board approval of the demolition.
The San Luis Apartments (originally the DeVille Motor Hotel) in 2007.
Circuit Court Judge Robert Dierker, Jr. dismissed the case with prejudice, claiming that citizens who cannot demonstrate financial grievance have no right to appeal actions by the Preservation Board! The building was subsequently demolished but the Friends decided to appeal Dierker’s anti-citizen ruling. The city’s preservation ordinance, after all, was enacted by the Board Aldermen for the general benefit of all citizens.
A three-judge panel of the Court of Appeals will consider oral arguments from both sides on May 5 and issue a ruling at a later date. Jonathan Beck and Ian Simmons represent the Friends of the San Luis, while Edward Goldenhersh and David Niemeier of Greensfelder, Hemke and Gale represent the Archdiocese.
Century Building
A case now five years old, Missouri Development Finance Board vs. Marcia Behrendt and Roger Plackemeier, just took a predictable turn. The cause was set to commence trial on March 15, but the plaintiffs again requested a continuance. Judge Mark Neill granted a continuance, and trial is now set for August 9, 2010.
Vintage postcard view of the Century Building, c. 1910
The plaintiffs — and this writer himself needed a refresher after such a long time — are the Missouri Development Finance Board, Land Clearance for Redevelopment Authority, NSG Developers LLC, St. Louis Custom and Post Office Building and Associates. Their cause? Even a refresher won’t quite make that clear. The allegation is that by being willing to file suit against the Old Post Office project to stop the Century Building demolition — a Dierkerian filing predicated on injury to personal property value — Marcia Behrendt and Roger Plackemeier somehow were being malicious. Never mind that Behrendt and Plackemeier’s suit was dismissed and had no effect on the outcome of the Old Post Office project (although shoddy construction work did).
The seriousness of the plaintiff’s allegation keeps getting undermined by constant requests for continuance. Is the goal to be vindicated by a jury or to harass citizens for exercising their legal rights? And why are our city and state governmental bodies still enjoined as plaintiffs, wasting taxpayer money at a time when both levels of government need every cent they can get? Time to drop the suit.
NorthSide
Last week Judge Dierker — one tie that binds all three cases — issued the following order extending for one week the deadlines for brief in the suit against the city over the NorthSide redevelopment ordinances:
Upon the request of defendant Northside Regeneration, LLC, and with the consent of the parties, the post-trial briefing schedule is hereby amended to provide as follows: Brief Due Plaintiffs’/Intervenors’ briefs 3/26/10 Defendants’ briefs 4/12/10 Plaintiffs’/Intervenors’ reply briefs 4/22/10.
Plaintiffs can expect a lengthy, colorful ruling from Dierker. Otherwise, speculation is useless. Dierker has a narrow view of citizen rights under development law, so his basis will be whether the plaintiffs have proven that their real estate is harmed or devalued under the blighting enacted by the redevelopment ordinance. Dierker has stated in trial that he is not prepared to consider condemnation that has yet to be authorized, and the ordinance avoids explicit authorization.
by Michael R. Allen
Reader Anthony A. sent me these photographs of the St. Louis Carnival Supply Company buildings being demolished. These photographs date to March 22nd and show some of the painted signs underneath the metal cladding. Since the wreckers did not remove the cladding first, the signs were never fully revealed. The buildings are now reduced to rubble piles.
by Michael R. Allen
Today the Post-Dispatch has an excellently-titled editorial on Governor Jay Nixon’s tax credit proposal: “Tax credit plan advances dubious policy based on false urgency”.
The editorial writer makes many good points, but a key observation is the timing of the proposal:
The tax credit debate hardly is new; the Legislature has been debating it for at least two years. Mr. Nixon has had ample time for an orderly, informed public debate on how best to proceed. But he chose to drop this complicated proposal out of the blue, with just six weeks remaining in an otherwise busy and contentious legislative session.
The timing of the proposal has led some observers to view it as a red herring designed to get the legislature to act. However, the resonance of Nixon’s views with those of Republican Senators like Jason Crowell and Matt Bartle cannot be underestimated. In past years — including last year — the governor stood on the side lines of the tax credit debates in the legislature, frustrating many urban Democrats who has enthusiastically supported his election.
This year, Nixon has aligned with those who view tax credits as “welfare” and who view welfare — and most government spending — as stealing. Some tax credits are dubious, but a true overhaul would evaluate the net economic benefit of each program before making cuts. The Rutgers study of state historic rehabilitation tax credits is a model of careful analysis that should guide decision-makers. This writer doubts that every program would show a net benefit if analyzed carefully. In the absence of such study, we are left with the prospect of continued contest of interests. Nixon’s proposal would amp up that contest, and create a wholly political tax credit system. Nixon is playing politics, not making policy. And Missouri’s legislators should reject his proposal.
Governor Nixon can be reached at:
Office of Governor Jay Nixon
P.O. Box 720
Jefferson City, MO 65102
(573) 751-3222
by Michael R. Allen
The National Trust for Historic Preservation has announced the slogan for this year’s Preservation Month of May: Old is the New Green. That catchy theme fits the strong focus on environmental stewardship that preservation advocates have embraced as well as the necessity of thrift amid ongoing recession.
While historic preservation is a year-round pursuit, having 31 whole days to celebrate and educate offers wonderful opportunities to showcase historic buildings endangered or rejuvenated, spread information and skills, share photographs and ideas and engage the broad theme of “old is the new green.”
What can St. Louis do to celebrate Preservation Month? Will you and your neighbors help organize a walking tour, street fair, art walk, house tour or other event to showcase your historic architecture? Can transit advocates and urban farmers find ways to plug in?
We’ll find out!
Please send your Preservation Month event announcements to me via email (michael@preservationresearch.com) or via the comments section and I will post them here in late April.
by Michael R. Allen
Missouri Governor Jay Nixon’s tax credit proposal is taking heat from the national conservative organization Americans for Tax Reform (ATR). Yesterday, ATR’s blog carried the story “Missouri Governor Nixon is Not a Crook, but His Tax Policy Sure is Criminal”, which blasted the hypocrisy of Nixon’s anti-tax rhetoric and his plan to cut tax credit programs that return money to citizens and create jobs.
ATR even notes the Rutgers study on the economic benefits of historic tax credits:
Yet, according to a study by Rutgers University, at least some of these supposed “hand-outs” are in fact legitimate job-creating policies. The study shows the positive impact of historic tax credits and further notes that Missouri is one of the largest beneficiaries of these credits in terms of jobs and income. This makes sense: putting money back into the hands of the people likely produces jobs…and guess what? Nixon proposes cutting and capping these credits more than any other!
Nixon’s move to court the right wing of the Missouri Senate has generated at least one right wing opponent. No wonder — Nixon’s position is already costing him allies on his own side of the political fence. Why shouldn’t he also be losing allies on the side that he’s trying to placate? In politics, pleasing everyone is impossible, but making everyone upset with you certainly is not.