ST. LOUIS — Two vocal critics of the city’s north St. Louis grant program are suing to block the city’s economic development arm from making any more payments.
The lawsuit from Tameka Stigers and her Delmar Boulevard salon, Locs of Glory, and developer Kevin Bryant’s Kingsway Development accuses the city and the St. Louis Development Corp. of awarding grants in an “arbitrary, unlawful and irrational†manner.
The $37 million North Side grant program, funded with federal pandemic aid, caused controversy last year after business owners passed over for grants began questioning SLDC’s process for vetting and choosing grant winners.
Stigers, who applied for a $1 million grant, was one of the most vocal critics, arguing SLDC should have kept the focus on longtime north St. Louis business owners like it had promised rather than awarding large grants to big institutions such as the Urban League.
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A Post-Dispatch investigation found some grants were going to go to organizations connected to the family of Alderwoman Shameem Clark Hubbard, who sponsored a bill expanding the grants’ eligibility. The newspaper also found other grants were slated to go to businesses that listed addresses in vacant buildings or weren’t in north St. Louis.
After the outcry, SLDC put the program on hold and had its board review and approve grants before they were awarded. SLDC also rescinded some of the more controversial awards, including those in vacant buildings and a $739,000 grant tied to a nonexistent homeless shelter that a Clark-Hubbard family member planned. The Urban League also eventually relinquished its $2 million award for upgrades to its North Kingshighway headquarters, saying construction costs had risen and the project’s budget had become unaffordable.
Other grants have been approved, like $1.7 million for Ozella J. Foster Funeral Services, which opened its new building on Martin Luther King Drive this week.
Stigers is still in line for a potential $12,500 that could go to any eligible applicant, pending checks on taxes and operations. But she and other critics have called that “hush money.†Bryant, whose development firm is another plaintiff, has also criticized the program, and SLDC last month rescinded his award of $500,000. He applied for more than $3 million from the program.
The lawsuit, filed by attorney Elkin Kistner, argues the program has violated federal pandemic aid regulations and the Missouri Constitution’s prohibition on gifts to individuals. That argument found success in St. Louis Circuit Court last year, when a judge stopped a city plan to use pandemic aid to pay $500 a month to poor families.
The lawsuit asks a judge to halt the program and declare it unconstitutional.
A spokesman for SLDC, Deion Broxton, said the agency hasn’t been served with the lawsuit but SLDC has discretion to deny funds to businesses it believes aren’t capable of meeting the program’s goals. SLDC also pointed out that Bryant has defaulted on a $5.7 million city-backed loan.
“As a matter of good stewardship, SLDC would prefer to see Kingsway complete a redevelopment project before investing $500,000 of the City’s ARPA allocation in a new endeavor,†Broxton said.
A spokesman for Mayor Tishaura O. Jones declined to comment.
The St. Louis Development Corporation president and CEO Neal Richardson explained details and goals behind the North St. Louis Small Business and Non-Profit Grant Program, as well as how they plan to verify businesses are using the money correctly. Video by Allie Schallert, aschallert@post-dispatch.com