When Ferguson riots left behind the charred hulks of buildings on West Florissant Avenue, St. Louis County tapped the funds of a little-known economic development agency to tear them down.
When Ursuline Academy wanted to finance the expansion of the Catholic girls school in Oakland, it turned to that same agency to issue bonds.
As St. Louis County laid plans for an amateur sports corridor around Creve Coeur Lake Park, it was the same low-profile body that began paying politically connected lawyers for the effort.
But it wasn’t until a St. Louis County Council member threatened to hold up the acquisition of Jamestown Mall that the work of the St. Louis County Port Authority came under a spotlight.
Amid the alphabet soup of economic development agencies throughout the region, the St. Louis County Port Authority stands out as among the more powerful.
Unlike many similar agencies, its actions don’t ultimately go back to a legislative body — in this case, the St. Louis County Council — for final approval. It doles out millions of dollars a year in grants and contracts, one of which was awarded without other bids, possibly in violation of state statute.
And despite its name, it rarely deals with barge docks or loading platforms.
Rochelle Walton Gray — the north St. Louis County Councilwoman whose district includes the shuttered mall property — said she was taken by “total surprise” when the port authority did an end run around her Jamestown Mall legislation. She had sponsored the bill to give the council more sway over who develops the property, a bill that her colleagues voted down because some were worried it would face legal challenges.
“I wasn’t aware that they didn’t have to — and we’re still checking — have to be along a waterway as far as their boundaries are concerned,” Walton Gray said of the port authority.
While the St. Louis and Kansas City port authorities focus on developing infrastructure for navigating the waterways or developing the riverfront, the St. Louis County Port Authority acts as both a driver and a behind-the-scenes player on projects anywhere in St. Louis County — not just the banks of the Mississippi and Missouri rivers.
“Many of them are focused on port facilities, but there is a laundry list of approved powers that would include all manner of property acquisition and any ownership, sale or lease of property,” said Robert Klahr, an Armstrong Teasdale lawyer who helped St. Louis County establish a special port taxing district two years ago. “I think it’s clear the statute doesn’t limit a port authority’s powers to just port facilities.”
‘Only a casino’
Key to the port authority’s versatility is a dedicated revenue source independent of the ups and downs of county budgets or council appropriations. Spending that money falls beyond the reach of the St. Louis County Council, letting the port authority board decide where to spend it without the same level of public scrutiny.
Since 2010, River City Casino has paid the port authority at least $4 million per year in rent, a deal St. Louis County struck more than a decade ago. In exchange for a cleaned-up former lead site in Lemay, River City agreed to a 99-year lease that promised annual rent to the port authority and an upfront payment for a community center.
“You had a contaminated site, it was in the floodway of the Mississippi River, and there was no access, so only a casino would say, ‘not a problem,’” said Denny Coleman, the retired longtime head of the St. Louis County Economic Council who helped hammer out the deal to bring River City to St. Louis County. “We had a chance to use this money almost like a Community Development Block Grant fund.”
Casino rent payments are based on total revenue, and in recent years annual rent to the port authority has topped $5 million.
That money is mostly managed by staff from the St. Louis Economic Development Partnership, an outgrowth of the County Economic Council. Much of its current leadership assumed their roles after St. Louis County Executive Steve Stenger took office in 2015, while the former top leadership departed in the months after the change at the county executive’s office.
The county executive appoints board members to the port authority, which must be confirmed by the County Council. All the current members were appointed by prior county executives. The port authority’s longtime chairman, Sheila Sweeney, was tapped as executive director of the Partnership in October 2015 after Coleman’s retirement.
Stenger said the port authority had been “highly effective” during his two years in office. “Our input in the situation is through Sheila Sweeney, who we work very closely with on a number of fronts.”
But he and Sweeney said they didn’t think the port was any more active than it used to be as an economic development tool. Sweeney referenced its role during the effort to develop a hub at St. Louis Lambert International Airport meant to lure Chinese air cargo, which the port authority committed $3 million toward. It has also set up a fund to invest in startups and helped spur development around the Donald Danforth Plant Science Center.
Since it began receiving casino rent, the port authority has spent $33.5 million on grants and other projects and obligated $67.8 million in spending, according to its fiscal year-end report from September.
For the first five years, most of the port authority’s money went to community groups around Lemay per an agreement in the casino lease. But it committed money elsewhere, too, such as for a new pool at the North County Recreation Complex just northwest of Lewis and Clark Boulevard and Interstate 270.
Now, restrictions on where the money must be spent have expired, giving the port authority license to spend its casino revenue anywhere in the county.
That’s not to say Lemay organizations aren’t still receiving assistance. The Lemay Housing Partnership was awarded a $50,000 grant in August. Out of $5.1 million that had been committed over the years, it still had $961,000 to spend from the port authority at the end of its fiscal year in September. The Lemay Child and Family Center still had $202,000 to spend in port authority commitments at the end of September.
Still, when it reviewed applications for its Port Reinvestment Grants program in September, the port authority only made two awards worth a total of $217,000. The chief financial officer for the Economic Development Partnership, Joyce Steiger, told board members that because of all the port authority’s obligations, it wasn’t able to make as many grants as in the past, according to meeting minutes.
The prior September, she said the same thing when the port authority board looked at Port Reinvestment Grant applicants. The board decided to fund seven grants worth $722,000 at that meeting. That was down from nine grants worth $1.8 million awarded in August 2014.
As the former county councilman representing south St. Louis County, Stenger followed the port authority’s activities closely and said he saw “the transformation they were able to work in Lemay.” County government is working to keep supporting those community organizations that helped prop up the area through other means, such as Community Development Block Grants, he said.
“If we are not funding them through the port authority, we are funding them extensively through other sources,” Stenger said.
Newly-elected South County Councilman Ernie Trakas said he’ll be following the port authority closely, even though he acknowledges he has little formal control over it.
“Now, the question is, how much of those funds are going to be funneled to Lemay?” Trakas said. “Am I frustrated at the statutory and legal structure of (the port authority)? You bet.”
Broad powers, big projects
Just about any economic development power falls within the purview of the St. Louis County Port Authority. It is redeveloping property in Wellston, paying high-profile lawyers, financing startups and funding road projects.
Some of its actions are publicized, such as when $500,000 of port authority funds were used to demolish damaged buildings in Ferguson and Dellwood. It used another $500,000 for flood relief after the December 2015 floods ravaged communities along the Meramec River.
Other actions aren’t. Last year, it awarded a contract worth up to $422,000 to consulting firm Accenture to evaluate the county’s infrastructure needs. It also made a $1 million forgivable loan to a nonprofit entity overseen by the Partnership called the Critical Technologies Corp. Sweeney said details were still being worked out, but the plan is to eventually use the entity to help connect smaller investors with area businesses.
Its biggest project was developing the $17 million Pavilion at Lemay, the community and aquatic center in Jefferson Barracks that opened in 2015. Along with a one-time payment from the casino to help cover financing costs, the port authority also established a Port Improvement District and a Community Improvement District to levy a combined 1.75 percent sales tax at the casino to fund community center operations.
Now, the port authority is in the midst of several new projects. Buying the rest of Jamestown Mall is just one of them that will tap additional funds. It already spent $200,000 in 2015 to acquire the former JCPenney portion of the mall.
Stenger said he initially tried to use another economic development agency to acquire the remaining mall property in order to involve the County Council. But he was forced to turn to the port authority because of Walton Gray’s bill.
“We have transactions that are ongoing, and we want to resolve those transactions favorably toward the taxpayers of St. Louis County,” he said of the mall acquisition. “And we have citizens of that area of the former mall property who really want to see this move forward.”
As Stenger’s administration pursued a youth soccer complex and a four-rink hockey facility that would serve as the NHL Blues’ practice ice, the port authority created the “Sports Recreation Initiative” and appropriated money behind the scenes to help make the projects happen.
In June, it awarded a contract worth up to $50,000 to Clayton-based Blitz, Bardgett and Deutsch for legal services related to the project. In December, the port authority board decided to increase that amount to $75,000.
Instead of putting out a request for proposals, the port authority’s staff requested a proposal for services directly from the law firm, according to meeting minutes.
The Missouri statute governing port authorities says that “any expenditure” over $25,000 must be competitively bid, “including professional service contracts.”
Sweeney, in a statement, said the port authority’s procurement policy allowed for “sole sourcing a contract” when the vendor had unique expertise.
“The Blitz, Bardgett & Deutsch law firm has specialized knowledge pertaining to the legal matters involved in prominent Missouri sports facilities, experience which is widely known and recognized,” she said.
Bob Blitz was one of the leaders of the unsuccessful effort to keep the Rams from leaving St. Louis. He is also a prominent campaign contributor to Democratic politicians in the state, including Stenger. In January, he wrote a $12,500 check to Stenger’s campaign account. Last year, he donated $8,000 to the county executive’s campaign.
The Sports Recreation Initiative isn’t the only port authority contract Blitz’s firm has won. In August, the port authority awarded the firm up to $50,000 in legal services for the infrastructure study being conducted by Accenture. Blitz did not return a call for comment.
Stenger said he had no role in the contracts and noted that the port authority board members were all appointed by former county executives.
“I played no role — directly or indirectly — in the port authority board’s decision to hire Blitz, Bardgett, & Deutsch to handle these legal matters,” he said. “I have no supervisory authority over the port authority, its board, its management or individuals hired by it.”
Steve Giegerich of the Post-Dispatch contributed to this report.
Editor's note: This story has been updated to indicate the National Lead site was used for titanium dioxide manufacturing, used in paint pigments and other products, not smelting.