The 1990s saw significant job and business growth in St. Charles County, especially with technology-oriented companies. By 2000, commercial construction exceeded $70 million. This month, we’ll look at this business development in the 90s in the second part of a series on how the County, municipalities and businesses managed and encouraged prosperity and growth from the 1970s to 2000.
Job creation in the 90s was spurred by the University of Missouri Research Park, created by statute in 1986 on ground near the Busch Wildlife Area. Tetra Plastics moved to the Missouri Research Park in 1995, saving the company’s 200 jobs, while creating 100 more. By the mid-90s, many new companies were attracted to the Highway 40-61 corridor. Following the lead of Lake Saint Louis, O’Fallon and Wentzville, the County Council created an entirely new zoning district in 1996 for what became known as the High-Tech Corridor. With many landowners wanting to sell to residential developers, and other landowners opposed to any development at all, establishing and preserving the corridor for high tech industries became a challenge. GTE brought 300 new jobs to its facility in Wentzville in 1995, and O’Fallon subsidized the expansion of MEMC, which produced silicon chips. King Safety Products was the first tenant to move into the O’Fallon Corporate Centre in 1996.1
O’Fallon approved the rezoning for the Winghaven project in 1997. Near Highway 40-61 and DD, the project included an office park, high-tech research area, light industrial space, residential neighborhoods and a Jack Nicklaus signature golf course. The following year, MasterCard announced Winghaven would be the location of its new Global Operations Center, intended to process nearly all MasterCard payments worldwide. The new $90 million facility was to house 500 new jobs previously in four different buildings in St. Louis County. The Post-Dispatch reported, “Mastercard has a 20-year history here of taking people in entry-level jobs and training them to hold hard-to-fill posts in information technology. That’s why local and state leaders were willing to jump through hoops to get Mastercard to keep and expand its operations in the region.”2 The state provided a total of $37 million in incentives, including three million dollars for job training. The Missouri Department of Transportation (MoDOT) accelerated completion of an overpass on Highway 40-61, and the County Road Board funded Winghaven Boulevard. When completed in 2001, the $135 million Global Technology and Operations Center housed 2,100 employees.3
WorldCom broke ground in 1999 for a new $50 million regional headquarters in Weldon Spring, where the company planned to relocate approximately 1,350 employees from elsewhere in the region. With the pledge of an equal number of new jobs, St. Charles County funded improvements to the Highway 40-61 North Outer Road, and the Telecommunications giant opened its new Customer Service Operations Facility in 2000. Two years later, Professor E. Terence Jones pointed out that economic development in St. Charles County had allowed the St. Louis region to remain competitive nationally, stating, “If it hadn’t been for St. Charles County, we would have lost considerable ground. (St. Charles) has been the key, more than any other part of the St. Louis region, to our ‘holding our own’ during (the past 20 years).”4
When company officials dedicated the new $85 million facility for 5,000 employees in 2003, CitiMortgage became the largest employer in St. Charles County. A new arterial road through the campus called Technology Drive, funded by $4.5 million from the County’s transportation sales tax fund, served the new Progress Point Business Park, including Citi’s facility. The project received a total of $22 million in tax breaks from state and local governments. Realizing the geographical and geological advantages of the area, Enterprise Leasing moved to its new data center in Weldon Spring in 2005.5
The more traditional manufacturing sector of the economy continued to provide jobs. American Car and Foundry (ACF), which had moved out of St. Charles in the early 1980’s, announced in 1995 that it was moving its 250-person office operation back to the city. McDonnell-Douglas Aircraft merged with Boeing Aircraft in 1996, the same year the company’s St. Charles plant, with 800 employees, delivered the first of 700 SLAM missiles to the United States Navy. The plant employed 800 and was planning to add an additional 250 jobs by 1999. New companies during the period included Alvey Inc., which broke ground in Arrowhead Industrial Park in 1995, and Coca-Cola, which broke ground in 1999 for a new divisional headquarters and sales distribution center in Elm Point Industrial Park. Existing companies were also expanding. The Wentzville Assembly Plant brought back 2,400 employees after a two-year shutdown to assemble the facility’s first mini-van in 1995. General Motors announced the next year that a $100 million stamping plant would be built adjacent to the Wentzville plant. St. Charles County’s job growth from 1994 until 2003 was 31.9 percent. Its addition of 5,300 jobs during a 12-month period ranked it among the top 25 counties in job growth during 2004.6
Of course, not all the economic news was good. McDonnell-Douglas Aircraft, which had its A-12 Avenger contract cancelled in 1991, laid off 10,000 employees in the area in 1990 and 1991. With cuts in the defense budget due to the end of the Cold War, the company closed Building 500 on North Highway 94 in 1995, eliminating 300 jobs. McDonnell-Douglas continued to reduce its workforce, and by October 1995 the unemployment rate for the county was 3.6 percent, a point higher than 2.8 in September 1994. Further jobs were lost after the September 11 terrorist attack in 2001, when reduced airline flights forced American Airlines to discontinued use of Lambert Airport as an airline hub.
Many new jobs were also created by small businesses in St. Charles County. By November 1999, the Missouri Division of Employment Security reported an estimated 151,406 St. Charles County residents were employed, and the unemployment rate was 1.5 percent, an all-time low. The Economic Development Center of St. Charles County (EDC), formed in 1990, took over the role of Crossroads Economic Development Corporation on federal SBA loans. With some financial assistance from the county and municipal governments, the EDC formed a Small Business Incubator, hired a recruitment specialist, and opened a small business development Synergy Center in November 1993. In 2000, the EDC also formed Partners for Progress, a group of chief executive officers working to support quality growth in St. Charles County.7
Tax Increment Financing (TIF) was used primarily for industrial projects before 1990. However, that year the legislature expanded the TIF statute to allow the developer to capture one-half of the new sales tax generated by a development. The focus of TIF now shifted from industrial to retail commercial development. In 1992, O’Fallon approved a TIF for Venture, which promised to bring 300 jobs to the city by the end of the decade. While St. Charles created a TIF for the area adjacent to the casino for the purpose of building a convention center, it was never utilized. The city granted Bakewell Corporation two million dollars in tax benefits in 1996 and Fountain Lakes was approved for a $15 million TIF in 1997. Both were intended to provide industrial development. However, when the Fountain Lakes project did not generate enough property tax revenue to pay off the TIF bonds, the city rezoned a portion of the development for retail stores which could provide sales tax revenue to fund the project. While St. Charles County was very much a part of the “consumer society,” critics questioned the need to offer incentives to bring retail businesses to a county that was growing at a rate of nearly 9,000 people a year. The cities, which stood to gain additional sales tax even if the developer was allowed to keep one-half of it, got into a bidding war against each other.
The St. Charles City Council created a TIF for the St. Charles Mall, located at the northwest corner of I-70 and Fifth Street, in 1996. The only person voting “no” was Councilwoman Mary West, who pointed out that the project was in a prime commercial location and that the city should not be giving the owner help on improvements that the site could support on its own. Nevertheless, the council found the project could not happen “but for” the subsidy.8 A decade later, a TIF area was designated at the site of the old Noah’ Ark Restaurant and hotel. While it was perhaps the best piece of commercial real estate in St. Charles County, to get by the “but-for” test, St. Charles pointed to the fact that the owner had not done anything with the property for many years. The city’s TIF Commission voted not to recommend the project, but the City Council approved a $58 million TIF anyway, on a six to three vote.9
A development area also needed to be “blighted” before it qualified for TIF. Even though the Home Depot was built on largely vacant land, the St. Charles City Council found the development area to be “blighted.” In the case of the Fountain Lakes TIF, the council cited the fact that the undeveloped land was in the floodplain as evidence of “blight.” A concept designed to be used to “redevelop” inner cities, was being used to develop agricultural ground. The “Superblock” in downtown O’Fallon, bound by Main Street, Sonderen, Pitman and I-70, had been developed in the 1960s and 1970s. While outdated in design, and perhaps underutilized as a commercial area, it was not “blighted” under the original intent of the writers of the 1945 Constitution. When local landowners objected to the use by O’Fallon of eminent domain to take their property, the proposal was dropped. A TIF proposal for the Frenchtown neighborhood of St. Charles also died when the City council restricted the use of eminent domain by the developer. Such experiences reinforced the belief among developers that it was easier to “redevelop” undeveloped land. The courts cooperated, holding that defining “blight” was a legislative decision made by the board of aldermen, whose findings “will be accepted by the courts as conclusive evidence..."10 As a result, the St. Peters Board of Aldermen declared farm fields along Highway 370 to be “blighted,” because the local system of farm field roads was “inadequate and substandard,” not for the existing agricultural use, but for the intended commercial use.
In next month’s “A Look Back with the County Executive,” we will cover agricultural development and impacts of flooding.
1. Journal, Dec. 27, 1995, Dec. 29, 1996.
2. Post-Dispatch, Jan. 5, 2002.
3. The General Assembly passed legislation in 1996 renaming the Missouri State Highway Department the Missouri Department of Transportation (MoDOT).
4. St. Charles County Business Record, May 20, 2002.
5. Post-Dispatch, Jan. 5, 2002 and March 16, 2000.
6. Ibid., Oct. 28, 2005, Section C. Financier Carl Icahn purchased ACF in 1984.
7. With all the new business activity, by 2010, the only St. Charles businesses still around from 1929 were Pundmann Ford, St. Charles Savings Bank, Thro’s Clothing, Hackmann Lumber, and Parkview Gardens.
8. St. Charles Post, Feb. 1, 1996.
9. Post-Dispatch, Dec. 4, 2006.
10. Tax Increment Financing Comm’n of Kansas City v. J.E. Dunn Const. Co., Inc., 781 SW2d 10, eleven (Mo. 1989). For a discussion of the Frenchtown TIF see Post-Dispatch, May 22, 2007.