ST. LOUIS–(KMOX)–A high stakes case for developer Paul McKee, as his attorney calls on a state appeals court to restore a major tax break for McKee’s stalled northside redevelopment plan.
McKee sat watching in a dark pin stripe suit, as attorney Paul Puricelli argued before the three judge panel for restoration of the $390 million tax increment finance package nullified in July 2010 by Judge Robert Dierker.
“This case questions whether the TIF act can be used to subsidize large scale redvelopment projects that will evolve over time with changing markets, politics and technology,” Puricelli said.
Puricelli was seeking to deal with the finding by Judge Dierker that McKee’s plan “lacked a specific project” to qualify under current TIF law. Puricelli argued that unlike a smaller project such as a “Walmart on a corner,” McKee’s ambitions $8 billion, 23 year plan needs some open-endedness to adapt and evolve.
Puricelli also noted that McKee has invested “millions” of his own money in the plan and is committed to making it work.
An attorney representing plaintiff’s against McKee, Bevis Schock, argued that the court should not “shed a tear for Paul McKee.”
“The sympathy vote goes for the homeowner,” Schock said, “the lady whose house was blighted, whose value went down and who doesn’t know whether she’s going to be able to live in the house.”
Puricelli fired back that McKee has no plans for eminent domain, and if some isolated homes do need to be knocked down, that would require the approval of the St. Louis Board of Aldermen.
Lawyers against McKee also sought to raise doubts about his financial ability to pull off the plan. Schock told judges that McKee’s revenue projections are “from another universe,” that property values in north St. Louis would have to soar to “Ladue like” values to make his numbers work.
Another lawyer for the plaintiffs, D.B. Amon, also questioned McKee’s bankability.
“The proponents of the plan, Paul McKee and others, are financially strapped,” Amon said after the hearing, “He just lost a federal lawsuit with Bank South for $34 million dollars, which he’s personally on the hook for.”
McKee’s attorney, Paul Puricelli, argues that McKee is “very bankable,” and expects to win an appeal in the Bank South case.
McKee’s side pointed out afterwards that attorneys for the plaintiffs spent part of their clients’ valuable time before the panel arguing that they should be allowed to get their legal fees.
In the hallway after the hearing, McKee declined to talk about the case pending the appeals court decision.
When asked if he would still press forward with the northside plan — if he loses this case — McKee says he would “go back and start over.”
When asked if he would give up, McKee said, “No, never.”
A ruling in the case could take months.