Razing Chrysler North plant raises lots of questions
This article first appeared in the St. Louis Beacon, Feb. 17, 2011 - Is it easier to market the abandoned site of an automotive assembly plant if the shell of the building is still there or if it's been knocked to the ground?
That question is at the crux of a dispute between Sen. Claire McCaskill and St. Louis County Executive Charlie Dooley on one side and Fenton Mayor Dennis Hancock on the other, with the old Chrysler North assembly plant sitting squarely in the middle.
Earlier this week, McCaskill sent a letter to an acting assistant Treasury secretary expressing concern about plans to raze the North plant, which was shut down when Chrysler went into bankruptcy. She said she wants to make sure that the abandoned plant is not demolished before all efforts have been explored to put it to good use.
"Because of the location of the site," her letter to Timothy Massad said, "its proximity to local highway and towns and its existing structures, it has always been my hope that other entities would purchase the property to use it for manufacturing and create long-term jobs for the region. I have worked with local officials to help bring this vision to pass.
"In fact, St. Louis County and my office have heard from several entities who are interested in buying the site for manufacturing purposes. It is my understanding that many are particularly interested in buying the site with the North plant intact should they get the proper financing. Therefore, the premature demolition of the North Plant would be deeply troubling to me."
But Hancock, the mayor of Fenton, told the Beacon Thursday that the people marketing the property -- Capstone Advisory Group, which is handling the Chrysler liquidation nationwide, and DESCO, a local commercial property development group -- think the best way to attract interest in the site is if no buildings are left standing. The South plant was razed last fall.
"They say they haven't had any serious offers for the buildings," Hancock said, "and people who may be interested in the property aren't interested in using the buildings.
"Given the state of the economy the last couple of years, a 295-acre parcel is a big bite to take. As things are beginning to loosen up, interest in the site is beginning to grow. I hear there are parties interested, some of them interested enough that Capstone is continuing negotiations with them."
Hancock said McCaskill's letter, which was released by her office on Wednesday, took him by surprise, and he wished she had talked the situation over with him or others more directly involved in the process.
"She's entitled to her opinion," he said. "It probably would had made more sense for her to have discussed it with us or with the Capstone folks or with DESCO before sending a letter. There are some statements in the letter that weren't accurate."
For example, he noted that McCaskill said that "Capstone appears to have moved ahead with the contract on the North plant before receiving approval from the county to demolish it."
But Hancock said that the county isn't involved in the demolition procedure at all, since the site is within Fenton's city limits. He said that the city retains jurisdiction over the process, with the county performing inspections and permitting services at Fenton's direction.
McCaskill also raised questions about whether Capstone properly used funds from the demolition of the South plant. Capstone did not respond to requests from the Beacon for its side of that issue.
That silence is similar to what Dooley says St. Louis County has experienced in its efforts to get information about the Chrysler situation. He said that he has been disappointed in how Capstone has handled the situation, both in terms of its intention to knock down the North plant and how they are marketing the site for future development.
"They misled us on their intention," Dooley said. "That's the disappointing part about it. We feel we were not told the truth.
"They have not been acting in good faith. They won't tell us what offers they have been turning down. We don't know whether they are legitimate or not. They say it's confidential."
As far as McCaskill's objections to razing the North plant, Dooley said:
"I'm with her. If people see that the plant is still there, we believe we have a better chance to market the area. You can still subdivide the building, maybe use it for small manufacturing or light industrial."
Dooley said it's possible that the site could be rebuilt in a greener manner, but that won't necessarily make marketing it any easier.
He said permits have now been issued for demolition of three outbuildings on the property -- an administration structure, an engine building and a firehouse. He said asbestos removal is ongoing at the main plant, and once the Health Department has given its approval, a demolition permit can be issued for that building as well.
Dooley said that removal is not expected to be complete until early March.
Last month, a state senator and state representative introduced bills that would help bring jobs to the Fenton site by creating what is known as an Enhanced Enterprise Zone. Sen. Eric Schmitt, R-Glendale, and Rep. Mike Leara, R-south St. Louis County, said they designed their legislation to make expansion, job creation and relocation easier and more effective.
Their bills would modify the existing Missouri Quality Jobs program, slightly relaxing the existing criteria for business expansion projects locating at the Chrysler site, and nearby properties until Oct. 31, 2014.
"Enterprise Zones have proven to reduce unemployment and increase incomes,"
Leara said. "Amending the current program for a limited period allows for the area surrounding Chrysler to more quickly attract new businesses and recover from the closure of two auto plants and the surrounding manufacturing supply base."
"The modification to the Missouri Quality Jobs program enhances the ability of industrial, high-tech and small business to create employment opportunities by adjusting current thresholds so that companies can put hard-working Missourians back on their payroll."
In view of such efforts, McCaskill concluded in her letter, "there is real interest in the North plant from potential buyers. If the plant is demolished prematurely, it could affect the ability to bring good paying, long-term manufacturing jobs to the region."
On the desire to turn the vacant site into one that provides jobs, Hancock and the senator are in full agreement.
"The reality is that it is a 50-year-old building built to make automobiles," he said. "It is not really adaptable to other industries. If we can find someone who is interested in the property and we continue with the demolition, we could have an awful lot of construction jobs and put an awful lot of people back to work for a long time.
"That has been our focus all along. I think that's what we are all interested in, whether it's me or the county executive or Sen. McCaskill."