Saying that developer Paul McKee Jr.’s publicly funded projects have made “satisfactory” progress in 2019 is “not a correct reflection of reality,” according to Mayor Lyda Krewson’s chief of staff.
On February 5, Krewson vetoed a bill that reviewed the annual progress of 21 tax increment financing projects (TIFs). The Board of Aldermen passed the bill without much debate on January 17.
The main target of the mayor’s contention was the NorthSide Regeneration project, where the bill listed the TIF amount as $490.6 million. The development project covers much of North St. Louis and was originally awarded a $390 million TIF amount. (The mayor’s spokesman is checking if this is a typo.)
“We are going to have them scrutinize closer,” said Steve Conway, the mayor’s chief of staff. “We need to make sure when you say that something is making progress that it’s actually making progress.”
When asked how McKee’s NorthSide development project has impacted North St. Louis, Conway said, “That’s about a two-hour answer. The city is taking a legal position on where he’s at on those things.”
In June 2018, city officials attempted to end the development agreement for the NorthSide Regeneration project. The default notice that the city issued to McKee stated, “After a decade, the promised redevelopment has not come, nor is there any indication that it will.”
The project’s lender Bank of Washington then sued the city, and the litigation is still ongoing.
This fall the aldermen approved $8 million in incentives for a three-bedroom hospital and emergency room — a project that falls within the NorthSide Regeneration footprint. However, project leaders have since not been able to confirm that the facility will be able to accept Medicaid or Medicare — despite the hospital being located in the middle of one of the most impoverished and medically underserved areas in the region.
The American asked Conway if the St. Louis Development Corporation (SLDC) would be scrutinizing the project leaders’ promise that the hospital is going to be able to accept clients with Medicaid and Medicare. Conway said he would look into it.
Freestanding emergency rooms — which is what project leaders have called the facility — are not recognized by the federal government and cannot accept Medicaid and Medicare. In fact, studies have found that freestanding emergency rooms end up costing patients more than standard emergency room fees.
“Patients are getting hit with astronomical medical bills that they wouldn’t get if they were coming out of a hospital,” Alderwoman Annie Rice (D-8th Ward), who is a civil rights and immigration attorney, testified about the hospital board bill. “If the care is going to come attached with a massive medical bill,” she said, then it will bankrupt patients.
The American has repeatedly tried to reach David Lenihan, who is not a medical doctor but is leading the medical side of the hospital project, but has not received a response.
Last week, the project’s attorney Joseph Dulle said that he believed having the three-bedroom hospital attached to the emergency room would be enough to get federal recognition. The American asked if they had official confirmation or a legal opinion reflecting that, and Dulle said that he didn’t know.
Having three beds is enough to get state recognition for a hospital license, according to the Missouri Department of Health and Senior Services. But as far as being a provider of Medicaid or Medicare, the federal government decides.
The Centers for Medicare and Medicaid Services makes the final decision on who qualifies to be a provider, and that’s an agency under the U.S. Department of Health and Human Services. According to federal law, a hospital can be recognized as a Medicaid and Medicare provider if it primarily is engaged in providing to inpatients. The agency specifies that an inpatient is someone who “will require hospital care that is expected to span at least two midnights.”
Alderwoman Cara Spencer (D-Ward 20) was one of the sole votes against approving incentives for the hospital.
“When basic questions couldn’t be answered about the basic medical services provided there, you have grave concerns,” Spencer said, regarding the hospital’s ability to accept Medicaid.
Spencer also said the aldermen, herself included, should have done more “due diligence” before passing the TIF progress bill, particularly considering the city’s current litigation with McKee.
“It’s an incredible amount of incentives he’s gotten, and we have nothing to show for it,” Spencer said. “The McKee development model has not worked, and it’s time to take a different approach.”
