Missouri officials: Developer kept $2.5M in tax credits
ST. LOUIS (AP) — A St. Louis developer didn’t return about $2.5 million in tax credits for a property he owned for a couple months before deeding it back to the seller, according to the Missouri Department of Economic Development.
An agency official brought attention to the 15th Street property during Paul McKee’s trial Tuesday, the St. Louis Post-Dispatch reported . The trial began last week to determine the value of another one of McKee’s former St. Louis properties, the Buster Brown building.
The city took possession of the Buster Brown building to assemble a site for the National Geospatial Intelligence Agency’s western headquarters. The building’s former owner sold the Buster Brown property to McKee for $3.75 million in 2011, but city attorneys call the sale a “sham.” According to attorneys, the sale inflated the property’s value for the former owner and McKee to split tax credits issued based on the purchase price.
The deal was eventually unwound and returned to the former owner, before begin acquired by the city.
The credits on the Buster Brown building were returned by reducing the amount of tax credits issued on McKee’s future sales. It’s unclear if the Department of Economic Development will take action on the 15th Street transaction.
“There’s no process for paying it back, but I’m more than happy to sit down with the state” to discuss the tax credits issued for the 15th Street building, McKee testified Tuesday.
The trial has focused on the now-lapsed Distressed Area Land Assemblage program, which issued tax credits worth half the sale value of real estate and other costs. About $47 million in tax credits were issued before the program expired in 2013. McKee tapped into about $43 million of that amount, which assisted him in purchasing hundreds of acres in St. Louis.
Information from: St. Louis Post-Dispatch, http://www.stltoday.com