A ground-breaking deal between the city and developers of the City Foundry project promises to funnel $1.8 million into a fund designed to help low-income St. Louisans by creating and maintaining affordable housing in areas that need it most.
City Foundry developers New + Found have agreed to funnel $1.8 million of additional tax increment financing for the project into the city’s Affordable Housing Trust Fund, which will be used for affordable housing grants and loans on the North Side and in Forest Park Southeast.
New + Found agreed to the deal in order to get $17 million in TIF financing to help develop an abandoned heavy industrial site between Highway 40 and Forest Park Avenue near Vandeventer into apartments, stores, shops, open-air marketplaces, and entertainment venues. Mayor Tishaura Jones had previously made it clear that the City Foundry developers were not going to get the $17 million in additional TIF dollars unless some of the money was re-directed toward blighted city neighborhoods.
The new administration’s hard line against incentives for developers was summed up by Mayor Jones’ Director of Policy and Development, Nahuel Fefer.
“The city will no longer negotiate under the weight iof an inferiority complex which tells us the only way to lure in developers is to give away our tax base,” Fefer said in a City Hall statement announcing the re-negotiated deal. “If developers want public subsidies, they should plan to produce public goods.”
The campaign by the Jones administration to put the brakes on development incentives is a recognition by the new generation of political activists turned power brokers in the Mayor’s office and the Board of Aldermen that St. Louis has become three distinct cities, with most new development taking place in only one of them — the Central Corridor.
The North Side, half the city’s geographical area with one-quarter of its population, is largely (but not completely) crumbling, murderous, and poor, the occasional section of well-kept homes surrounded by dozens of blocks of collapsing buildings, smashed sidewalks, open-air gunplay, minimal city services, and a fleeing population. Fewer than 70,000 people now live north of Delmar. The city lost a breathtaking 14 percent of its African-American population between 2010 and 2020, as Black families moved out of dystopia into North County, the South Side, Illinois, and other states entirely.
The South Side, despite crime hot spots such as Dutchtown and Carondolet, is stable and slowly gentrifying. Like everything else in St. Louis, “slowly” is the operative word. And in this case “gentrifying” isn’t a pejorative, but merely an economic fact: the average income and education levels of the South Side are rising as four-flat apartments in Benton Park are being converted into single-family homes, and new deluxe construction is even creeping into the defiantly middle-class Hill, in both cases carrying price tags well above half a million dollars.
Then, there’s the Central Corridor, which is booming with tech businesses and (finally) apartments. This sliver of new companies, new jobs, and new development is what St. Louis would look like if it was a successful city and not, you know, St. Louis.
Development projects in the Corridor and South Side have received generous tax breaks over the years, while practically no development money at all has migrated north of Delmar. The Geospatial Intelligence Agency’s mammoth North Side campus is supposed to anchor new development, but any new businesses or housing cropping up around a top-secret spy agency installation patrolled by armed military personnel may be a stretch, especially since the territory outside of the NGA campus will still be high crime.
Mayor Jones is attempting to re-direct tax breaks given to developments in the Corridor or South Side toward sustainable development on the North Side. One of her first acts as Mayor was to veto a pair of Corridor development deals she felt were giveaways to companies stepping into an already successful environment.
One deal involves rehabbing the 12-story Jesuit Hall at Grand and Lindell into apartments, with a new 14-story apartment building to be constructed next door. The developer, an outfit called Neighborhood Properties LLC, got a 10-year, 95 percent property tax abatement from the Board of Aldermen the day before Jones was sworn in. Jones says that the development would have taken place “without incentives” and that it takes too much money away from the city’s schools.
The city currently loses roughly $36 million every year due to property tax abatements given to projects scattered across the Corridor and South Side. Since around 60 percent of property taxes go to schools, that’s a shade under $22 million a year taken from the St. Louis Public Schools budget.
The other big project is the City Foundry, headed by Steve Smith, CEO of the Lawrence Group architecture and design firm, and founder of the New + Found developers creating the Foundry project. Smith seemed to realize easily that he wasn’t going to get the $17 million in TIFs he wanted from the Jones administration unless he kicked something back from the booming Central Corridor into a fund for troubled neighborhoods.
An avid motorcyclist (he reportedly owns six), Smith may have been thinking about a line from the 1974 classic, “Zen and the Art of Motorcycle Maintenance,” where author Robert Pirsig wrote: “If a revolution destroys a systematic government, but the systematic patterns of thought that produced that government are left intact, then those patterns will keep repeating themselves in the succeeding government.”
It’s pretty clear the systematic patterns of thought of previous city administrations are being tossed out the window.