St. Paul keeps public subsidy options open for development by soccer stadium and Ford site

St. Paul tax incentives are still in play for development around the proposed Minnesota United stadium.

The majority of City Council members said Wednesday they do not want to rule out tax-increment financing (TIF) at the site just north of the stadium, which currently houses the Midway Shopping Center and a sprawling parking lot. They shot down Council Member Rebecca Noecker's resolution opposing a TIF district there in a 4-3 vote.

There has already been a lot of public investment around the soccer stadium site, Noecker said, and the city should proactively send the message that it does not want to create a TIF district. But others said the city needs to wait and see what is proposed at the site.

"It's very, very early," Council Member Amy Brendmoen said. "I think it's inappropriate and premature to remove any of our financing tools from the table."

A TIF district would take new property tax revenue generated at the Midway Shopping site and use it to help cover development costs or public improvements there.

City officials also voted Wednesday to keep the door open for TIF at another key property — the Ford site.

The 122 developable acres that used to house a Ford assembly plant are located on the bluff along the Mississippi River in Highland Park. The city plans to turn the land into a mixed-use neighborhood.

After the meeting in Michigan, the mayor's office sent out a news release saying, "Ford will enter the cleanup phase this year and move closer to marketing the site, as the city entertains a TIF district and completes the zoning and public realm plans."

The council's vote Wednesday to establish a TIF district at the Ford property came earlier than officials wanted, due to a looming deadline. In 2013, the city affirmed there were blighted buildings on the site and signed off on Ford's plan to demolish them. That kicked off a three-year window for the city to establish a TIF district — and that window closes Saturday.

The city has requested that the Legislature extend the deadline, but the state has not yet granted the extension. If the city gets more time the council could reconsider Wednesday's decision and wait to vote on TIF once they have a proposal from a developer, Tolbert said.

City leaders emphasized they are preserving TIF as an option at the Ford site — but they are not mandated to use it.

The city may also end up not using the tool at the site by the soccer stadium, where the owner of the Midway Shopping Center plans to create a mixed-use development with retail, housing, entertainment and a hotel.

Many of the TIF districts have lined developers' pockets while some of the business that move in don't pay a living wage, said Bernie Hesse, with Local 1189, which represents retail workers, among others.

However, Council Member Dai Thao said the tool could be used to ensure development includes components like affordable housing, which he would like to see at the site. He said use of TIF districts has not been equitable in St. Paul.

"If we are going to be against TIF we should start in downtown, not in Midway," said Thao, who, along with Brendmoen, Tolbert and Council President Russ Stark, voted not to oppose TIF by the proposed stadium.