The owners of the Water Tower Place Shopping Center have filed a lawsuit in Jefferson County Circuit Court to stop the city of Arnold from building a new road intended to connect the city’s northern and southern retail districts.
The lawsuit was filed late Monday night, Aug. 12.
The shopping center is on Michigan Avenue off Jeffco Boulevard, and Arnold officials have said a large section of the plaza will need to be acquired to build the road.
The lawsuit says the city of Arnold has acted in secret for the past three years to develop the road plan and acquire property for the project, which the Water Tower owners say is ill-defined and ill-justified. The lawsuit also says Arnold officials have failed to show the need for the road’s construction.
City officials recently made public its plans to build a 2-mile, two-lane road, to be called Arnold Parkway, that would connect Hwy. 141 and Richardson Road. The officials said the project would cost approximately $75 million and would be funded with revenue from the sale of bonds through the Arnold Retail Corridor Transportation Development District (ARC TDD).
That TDD was established in 2008 to fund infrastructure related to the development of the Arnold Commons retail complex and the redevelopment of the Arnold Crossroad complex. The TDD collects a 1 percent sales tax from businesses in those two retail developments, as well as some of the businesses in the Water Tower retail complex.
Water Tower owners claim in the suit that Arnold cannot use TDD funds to purchase or acquire property for the road, and that the city has interfered with Water Tower’s attempts to lease buildings in the shopping plaza.
In their lawsuit, the Water Tower owners ask the court to stop the city from moving forward with the road project and seek reasonable attorneys’ fees and expenses, according to the lawsuit.
“Given the secretive manner in which the city is going about this project, we had no choice but to file a lawsuit given the continued unlawful actions by the TDD, the threat of condemnation, and the city’s unlawful interference with Water Tower’s leasing efforts,” Water Tower spokesman Lance LeComb said in a written statement.
Arnold City Administrator Bryan Richison said he had not seen the lawsuit as of today, Aug. 14, and the city has not received a copy of the lawsuit.
The lawsuit names ARC TDD, city of Arnold, Arnold Acquisition Company, Arnold Triangle Transportation Development District, Richison, Ward 4 Councilman Gary Plunk, Community Development Director David Bookless, City Treasurer Dan Kroupa and Mayor Ron Counts as defendants. It lists Richison, Plunk, Counts, Kroupa and Bookless as ARC TDD board members.
Water Tower owners say in the suit that Arnold secretly created the Arnold Acquisition Company to purchase property for the project, adding that the acquisition company has purchased four homes and a commercial property below market value.
City officials have said those four homes and commercial property were purchased for the road project.
Arnold officials also said they have been planning the road project for about three years.
They said the new road would offer an alternative route to travel north to south in the city and provide easier access to shopping areas.
In order to have the proposed road built, Arnold officials said the city, through the ARC TDD, still needs to acquire CubeSmart Self Storage, 3401 Robinson Road off Richardson Road; the portion of the Water Tower shopping plaza that currently is home to the Fuentes Mexican, Puna Cafe and Sugarfire restaurants, Studio C Dance, GameStop and Trek Bicycle Arnold; 38 homes in the Key West Estates subdivision behind the shopping plaza and near Hwy. 141; and some businesses near the subdivision, such as the Bandana’s restaurant.
Arnold officials have said the city would prefer to purchase the properties, but it may use eminent domain to acquire the necessary land for the road.
Water Tower’s lawsuit says the TDD is not allowed to use eminent domain to acquire land, and it contends because the original bond of about $28 million used to fund infrastructure for the Arnold Commons and Arnold Crossroads developments has been paid off, the city should dissolve the ARC TDD.
City officials said the approximately $20 million bond was paid off last year, 15 years before it was set to expire. Officials also said the TDD may remain in place and collect the 1-percent sales tax through 2048.
The lawsuit says the Water Tower owners do not believe the sales tax collected in the TDD will produce enough revenue to cover the approximate $75 million road project. The lawsuit estimates the cost of the project at $78 million, which LeComb said was an estimate Arnold officials previously presented to the shopping plaza owners.
The lawsuit also says because more than 75 percent of the proposed road is outside the TDD, the city cannot use the TDD revenue to complete the project.
The suit also says the city, through the acquisition company, offered on April 2 to buy a portion of the Water Tower shopping plaza for a price “well below the fair market value.”
The Water Tower owners also said in the suit that the city sent the owners a condemnation notice on May 16, which read, “We continue to be open to negotiating with you and are hopeful that an agreement can be reached that is satisfactory to all parties. However, if the District (ARC TDD) cannot reach a binding agreement with you, the District will exercise its right to file a petition for eminent domain in the Circuit Court for Jefferson County, Missouri, to acquire your Property.”
Water Tower representatives met with Arnold officials on June 17 to discuss the road project and the city’s need to acquire part of the 30-acre shopping plaza that includes 35 businesses, as well as residential and commercial properties north of the plaza, according to the lawsuit.
The lawsuit also said Bookless contacted the Water Tower property manager in June about the Local House restaurant intending to lease the former 54th Street restaurant building, and Richison called and told the Local House owner on June 27 to not sign the lease.
Local House owner Tim Huelskamp announced on July 23 plans to move from 3946 Jeffco Blvd. to 2236 Michigan Ave., the former 54th Street location, before the end of this year. Huelskamp has not responded to phone calls from the Leader.
“Since the early 1990s, our shopping center has been a go-to place for Arnold families, has created thousands of good jobs and paid millions in taxes,” LeComb said in the written statement. “We take very good care of our property. We include retailers we think the people of Arnold will like, we keep everyone safe and we always pay our taxes on time. I guess being a good citizen in Arnold doesn’t matter like it used to.”