Inclusion under fire at TIF hearing

Community members were surprised Tuesday when they showed up to the TIF Commission’s public hearing for the CORTEX project, a $2.2 billion research park in the Central West End. It had been postponed until Dec. 12.

Sources said CORTEX postponed the meeting because of community leaders’ heightened calls for stronger minority participation goals on the project.

Dennis Lower, CEO and president of CORTEX, declined comment. Rodney Crim, executive director of the St. Louis Development Corporation (SLDC), told The American that the reason was logistical.

“It’s a big complicated project so it’s not anything unusual,” Crim said. “Our lawyers just want to look at every detail.”

Crim said SLDC and CORTEX will continue to talk about mandating more minority and women workers on the development’s construction, as well as incorporating some of the objectives in the First Source Jobs Policy – a city ordinance that requires companies who receive tax incentives to provide jobs for low-income residents.

The policy requires companies to hire 100 percent of entry-level jobs – jobs that require no vocational skill – from a list held by the St. Louis Agency on Training and Employment (SLATE).

In an interview with The American, Michael Holmes, executive director of SLATE, said CORTEX leaders are looking at how to incorporate the First Source policy in the agreement. However, Holmes said the law is limiting, and he would like the law and future agreements with developers to incorporate all job levels, not just jobs with no skill or experience required.

Adolphus Pruitt, president of the St. Louis City NAACP, has been meeting with Lower and said, “The NAACP is confident that our discussions to date on long-term employment opportunities for city residents are moving in the right direction and getting the proper attention from CORTEX.”

Pruitt also said MOKAN, an advocacy group for minority businesses and contractors, and CORTEX have reached “in principal” a set of policies and practices for construction workforce participation for the duration of the TIF. “It’s a model approach, and they need additional time to finalize it,” Pruitt said.

CWE Whole Foods

Also at the Tuesday meeting, the TIF Commission approved an application for a $10 million TIF for a $50 million project to develop a Whole Foods Market and 159 apartments on Euclid and West Pine. 

Developer Bruce Mills said he plans to follow the Mayor’s Executive Order, which sets the minority participation goals at 25 percent minority business enterprises (MBE) and 5 percent women business enterprises (WBE). They also plan to achieve the city’s “boots on the ground” goals stated in Board Bill 75, which mandates that 25 percent of the project’s labor hours go to minorities, 5 percent to women, 15 percent to apprentices and 20 percent to local workers.

Mills said he chose S.M. Wilson as the general contractor because of the company’s track record in meeting minority participation goals. During SM Wilson VP Fred Jaeckle’s presentation of their past work, TIF Commissioner Sheila Hudson questioned that record on their most recent project, O’Fallon Park Recreation Center in North St. Louis City.

“You had some issues meeting those goals,” Hudson said. “There were some challenges, and then at some point you went back and asked for more money to attain those goals.”

Jaeckle responded, “Right now we are in discussions with the Board of Public Service on that. We haven’t made any resolution.” 

In December 2009, the city of St. Louis accepted S.M. Wilson’s $16.7 million bid for the rec center and set the minority participation goals at the city’s minimum. But before the contract was signed, the Board of Aldermen urged the Board of Public Service (BPS) to require higher goals. After negotiations, S.M. Wilson agreed to meet participation goals of 40 percent MBE, 8 percent WBE and 32 percent minority workforce.

The city agreed to pay S.M. Wilson $650,000 to meet these higher goals in June 2010.

But then in March 2011, S.M. Wilson asked for another $1,163,065 to meet the same minority requirements. The city only awarded them an additional $523,888. Then S.M. Wilson asked for another $361,091 “in additional costs we have incurred to meet the goal,” Jaeckle stated in a Feb. 9 letter to BPS.

In total, the city owes the company an additional $1,000,229 to achieve the minority goal, according to Jaeckle’s February letter.

At the TIF meeting, Hudson repeated her question, “So where do we stand with that?”

“We are still having conversations about the closing out of the project, and it is not a closed issue at this time,” Jaeckle said.

The American asked Board of Public Service President Richard Bradley about the negotiations. He said the city is currently negotiating the final construction change orders with S.M. Wilson.  

“We currently see no reason for additional M/WBE costs,” Bradley said.

During public comment, NAACP’s Adolphus Pruitt raised the question of safeguards on the Whole Foods project, regarding the contractor. The NAACP opposed making any more payments to the contractor for minority participation, as did the Comptroller’s Office, he said.

“They haven’t received those payments. And the TIF Commission should assume that if payment isn’t made, that the city and contractor for this site are going to be in litigation,” Pruitt said.

One watchdog

TIF Commissioner Ken Hutchison asked the Whole Foods developer how he planned to achieve the minority participation goals, and Mills said they hired Sandra Marks and Associates as their consultant. Marks is the consultant for CORTEX, the Washington University’s School of Medicine Campus Renewal Project, and Washington University itself, along with many others. 

 Hutchinson said, “Every time I hear about goals, I’m hearing about one entity. Can one company continue to handle the load ensuring inclusion at every project? Nothing against Sandra Marks, but I’m hearing her name every time.”

Hutchinson said when we talk about inclusion, we are talking about unifying the city.

“When we’re talking about employment and hiring those folks in the minority community on these projects and how it then manifests down into their children and being able to pay for their education, I’m concerned about the capacity on every project,” he said.

Hudson said she concurred.

“I would also like to add my concern that in some cases these goals are not being met,” she said, “and you and other folks are being advised under Marks.”