St. Louis Business Journal (November 5)
A downtown St. Louis property owner is raising questions about transparency at the neighborhood booster that’s funded by a property assessment through the Downtown Community Improvement District (CID). Citing data found in Downtown STL Inc.’s tax filings, Adam Rustige told the nonprofit’s board in an Oct. 5 letter that he has “some serious concerns.”
“This information has reinvigorated a discussion among residents and businesses within the CID, regarding the quality of the business and living environment that the CID was intended to improve,” Rustige wrote. “Unfortunately, it is the perception, real or imagined, of a growing number of people that the CID, its contract/partnership with Downtown STL Inc. (DSI), is not getting the job done, and has not for several years.”
In particular, Rustige cited data reported by the Business Journal in June: that Downtown STL’s top four employees took home more than $707,000 in 2014.
Rustige, who owns property at the The Marquette, 314 N. Broadway, asked Downtown STL for “a detailed breakdown of expense allocations,” and other accounting and salary information, among other things. Rustige declined to comment. After obtaining Rustige’s letter, the Business Journal requested the same information.
Downtown STL CEO Missy Kelley responded Oct. 21, saying in a letter that the organization has fulfilled its mission by keeping the area safe and clean with its programs, working with developers (with more than $1 billion in current planned projects downtown), and conducting research she said would lead to more jobs and investment.
Downtown for years has lost jobs while office vacancy has increased, with departures including AT&T, Macy’s and major law firms.
Kelley also provided a letter from Downtown Neighborhood Association Executive Director Jared Opsal, in which he said Rustige’s assertions are “his view alone and not on behalf of DNA.” In her letter, Kelley said downtown’s residential population is growing at about 5 percent per year, with 7 percent growth last year. Downtown STL has also invested $300,000 in security cameras around downtown and is hoping to install $400,000 worth of new lighting along Market Street near Union Station, Kelley said in an interview. The LED lights would illuminate both the sidewalk and street, Kelley said.
In response to requests for financial information, Downtown STL said it was reimbursed by the CID for $1.9 million in fiscal 2015. That included $621,806 for security personnel; $276,668 for economic development personnel services; $517,889 for maintenance and beautification; $206,821 for marketing and events; and $253,228 for rent, office supplies; equipment and other services. The CID collects the property assessment in an area bounded by 14th Street to the west, Interstate 70 to the east, Interstate 64 to the south and Cole Street and Delmar Boulevard to the north.
Downtown STL gets roughly two-thirds of its funding from the CID. (Downtown STL also does fundraising and collects member dues.) The CID collected nearly $3 million from the property assessment in fiscal 2015. Kelley provided information showing that the CID paid administrative employees of Downtown STL more than $836,000 in fiscal 2015, or roughly 28 percent of the CID’s assessment.
The CID paid Downtown STL’s then-CEO Doug Woodruff $120,000 in fiscal 2015; Kevin Farrell, then-senior director of economic development, $90,870 (wasn’t replaced after he left in 2014); Mike Sondag, chief administrative officer, $101,665; Ken Gabel, director of urban space, $95,253; and the then-COO Kelley, $93,002, among other administrative personnel costs.
But the data didn’t show how much the Downtown STL employees were paid in total in fiscal 2015; they get part of their pay from the CID and another part from Downtown STL. Tax filings show that in fiscal 2014, Downtown STL’s then-CEO Woodruff, got total compensation of $262,302; Chief Administrative Officer Sondag got $156,329; then-Director of Development Farrell got $156,314; and then-COO Kelley got $132,662.
Amos Harris, a downtown developer and member of Downtown STL and the CID’s joint executive committee, said the organizations should be more transparent.
“We should invite criticism and invite people to come in with other ideas,” Harris said, adding that Downtown STL should put all funding and expense information 'on the web.'"
