Developer Paul McKee Inflated Property Values to Secure Tax Credits, St. Louis Officials Allege

By on May 11, 2018

From St. Louis Post-Dispatch:  St. Louis officials alleged Wednesday that a transaction between a property owner in the footprint of the National Geospatial-Intelligence Agency’s planned western headquarters and developer Paul McKee was designed to inflate sale values in a scheme to procure more state tax credits.

The allegations came out at a trial in St. Louis Circuit Court to decide a long-running challenge to the value of a property the city acquired by eminent domain as it was assembling land for the NGA’s future campus in north St. Louis.

Jim Osher, former owner of the Buster Brown shoe factory building at Jefferson and Cass avenues, has been fighting the city for two years over its acquisition of the property.

Osher pointed to a $3.75 million sale to McKee’s Northside Regeneration company in 2011 as evidence of the building’s value, which his attorney argued was now closer to $5 million. Osher had acquired the building at 1516 North Jefferson Avenue for about $200,000 in the 1990s.

The city’s Land Clearance for Redevelopment Authority, which acquired property for the NGA project, argued the value is closer to $573,000. A commission to decide value for eminent domain ended up paying a little more than $800,000 after it was acquired for the NGA project in 2016.

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