State v. Klos

• Decision Date: 14 November 2000
• Citation: 35 S.W.3d 457
• Parties: (Mo.App. E.D. 2000) State of Missouri, ex rel. Hazelwood Yellow Ribbon Committee, et al., Appellants, v. Colleen Klos City Clerk for the City of Hazelwood, Respondent., and Tristar Business Communities, LLC, and certain RPA I and II Residents, Intervening Respondents. ED77319
• Court: Missouri Court of Appeals

35 S.W.3d 457 (Mo.App. E.D. 2000)

State of Missouri, ex rel. Hazelwood Yellow Ribbon Committee, et al., Appellants, v. Colleen Klos City Clerk for the City of Hazelwood, Respondent., and Tristar Business Communities, LLC, and certain RPA I and II Residents, Intervening Respondents.

ED77319

Missouri Court of Appeals Eastern District

11/14/2000

Appeal From: Circuit Court of County of St. Louis, Hon. Kenneth J. Romines, Judge

Counsel for Appellant: Julie H. Hurwitz, Mark P. Fancher and Robert Herman

Counsel for Respondent: Kevin M. O'Keefe, Paul E. Martin, Jay L. Levitch and H. Kent Munson

Opinion Summary: This case arises from the opposition of a group of Hazelwood citizens to a tax increment financing (TIF) redevelopment project within the City of Hazelwood. They appeal the trial court's judgment denying them a writ of mandamus which sought to compel the City Clerk to certify and place on the ballot (1) a referendum measure proposing to repeal the city ordinance that approved the TIF project, and (2) two initiative measures proposing to amend the City Charter. One of the proposed charter amendments would provide that the approval of any future TIF project by the City of Hazelwood require the favorable vote of two-thirds (2/3) of the voters at a duly conducted municipal election; the other proposed amendment would strip the City of any power of eminent domain in connection with TIF projects.

Division One holds: The trial court did not err in denying relief on the basis that: (1) the referendum measure lacked sufficient signatures, and (2) both of the initiative measures clearly conflicted with Missouri's TIF Act and thus were facially unconstitutional.

Richard B. Teitelman, Judge

Opinion modified by Court's own motion on December 5, 2000. This substitution does not constitute a new opinion.

This case arises from Appellants' opposition to a Tax Increment Financing ("TIF") project within the City of Hazelwood. Appellants filed several TIF-related initiative and referendum petitions with the City, which the City Clerk refused to certify. Appellants then filed suit seeking to compel the Clerk to certify and place on the ballot at a duly conducted municipal election their initiative and referendum proposals. The Circuit Court granted a preliminary writ of mandamus but subsequently quashed the writ and dismissed Appellants' suit, finding that the ordinance repeal proposals lacked a sufficient number of voter signatures and that the proposed amendments to the City Charter were facially unconstitutional. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

A. The Parties

Appellant Hazelwood Yellow Ribbon Committee ("HYRC") is an association of approximately fifty citizens of Hazelwood, Missouri. It was organized in the late summer of 1998 for the purpose of opposing a proposed $17 million TIF tax subsidy to a private corporation to develop an industrial park in an area of Hazelwood, including farmland and wetlands, known as the "Missouri Bottom Road Area." HYRC also sought to amend Hazelwood's City Charter to require a two-thirds majority vote of registered Hazelwood voters to approve any future TIF plans, and to strip the City of any power of eminent domain with respect to TIF plans or projects. Leon Steinbach and the other individually named Appellants are all residents of, and/or taxpayers in, the City of Hazelwood. Respondent Collen Klos is the Clerk for the City of Hazelwood, a charter city organized pursuant to article VI, 19 of the Missouri Constitution and located within St. Louis County. Respondent/Intervenor Tristar Business Communities, LLC ("Tristar") is the City's chosen developer for the Missouri Bottom Road Area TIF project. Several individual Respondent/Intervenors ("the RPA Intervenors") consist of Hazelwood residents who own property in the Bottom Road Area.

B. TIF Development in Hazelwood

In January of 1998 the City of Hazelwood, acting pursuant to the missouri real property tax increment allocation redevelopment act (section 99.800 et seq., RSMo 1994¹) (the "TIF Act"), established by ordinance a commission (the Hazelwood Tax Increment Financing Commission) to consider and recommend possible redevelopment projects within the City utilizing tax increment financing. In October of that year the Commission prepared and made public its Redevelopment Plan for the Bottom Road Area, proposing that the area be designated a "TIF Redevelopment Area" and that approximately 696 acres within the area be developed for industrial and commercial use. As necessary conditions precedent to the designation of the Bottom road Area as a TIF Redevelopment Area, the area was identified by the Commission as a "Blighted Area" under section 99.805(2) and a "Conservation Area" under section 99.805(3).² On November 18, 1998, at a Hazelwood City Council meeting, a proposed ordinance officially designating the Bottom Road Area as a TIF Redevelopment Area, and approving a Redevelopment Plan and making the necessary findings of fact and authorizing the execution of necessary documents attendant thereto, was read for the first time. At the same meeting a separate proposed ordinance, adopting TIF financing for the proposed Bottom Road Area Redevelopment Plan, was also read for the first time. On December 16, 1998, the Hazelwood City Council unanimously adopted both ordinances---Ordinance 3020-98, which approved the Missouri Bottom Road Area TIF Redevelopment project, and Ordinance 3021-98, which adopted tax increment financing for the project. Under the plan adopted by these ordinances pursuant to the TIF Act, Hazelwood will issue TIF bonds in the amount of approximately $17 million, from which the proceeds will be used to finance various aspects of Tristar's development of the Bottom Road Area. All increased property tax revenues realized by the redevelopment of the Bottom Road Area, and fifty percent (50%) of all additional municipal and/or other tax revenues generated by economic activities within the project area, will be diverted from the general tax coffers from which municipal and public services are normally funded, and will instead be used to retire the TIF bonds issued by Hazelwood to Tristar.

C. Appellants' Referendum and Charter Amendment Petition Drives

On November 18, 1998, Appellants began circulating an initiative petition calling for the submission to Hazelwood voters of the following two proposed substantive amendments to the City's Charter:

a. That the City of Hazelwood's power of eminent domain incident to the

adoption and implementation of any TIF Redevelopment Plan or Project

be completely abrogated; and

b. That the adoption and approval of any TIF Redevelopment Project or

Plan by the City of Hazelwood require the favorable vote of two-thirds

(2/3) of the voters in a duly conducted Hazelwood election.

(the "Charter Amendment Petition").³

Appellants delivered the Charter Amendment Petition to Ms. Klos on December 16, 1998. The Petition contained nearly 4,000 signatures; the parties do not dispute that the number of signatures of qualified registered Hazelwood voters was significantly greater than the 10% required by Article XII, 16 of the Charter.⁴

On December 17, 1998, Appellants began the circulation of two new and separate referendum petitions, one seeking to repeal Hazelwood City Ordinance 3020-98, and the other to repeal Ordinance 3021-98 (collectively, the "TIF Referendum Petitions"). On January 5, 1999, Appellants delivered the TIF Referendum Petitions to Ms. Klos.

D. Respondent Klos's Rejection of Charter Amendment Petition

In a memorandum dated January 6, 1999 and mailed to Appellants the following day, Respondent Klos rejected the Charter Amendment Petition as insufficient. Though admitting the Petition had the requisite number of signatures, Ms. Klos concluded in her memorandum that the Petition was invalid on several grounds, including, among others: that the attached statements by circulators were deficient; that the Petition was improper as to form under sections 115.700 and 115.019; and that the proposed Charter Amendments were in violation of Article VI, 19(a) of the Missouri Constitution in that they directly conflicted with existing state statutes. On January 21 and 22, 1999, Appellants delivered an Amended Charter Amendment petition to Respondent Klos, in an attempt to address some of the alleged insufficiencies. By a separate memorandum dated February 3, 1999, which essentially restated the bases for denial as set forth in her January 6th memorandum, Ms. Klos also rejected the Amended Charter Amendment Petition as insufficient.⁵

E. Respondent Klos's Rejection of TIF Referendum Petitions

On January 5, 1999, Appellants delivered to Ms. Klos the two referendum petitions, one seeking repeal of Ordinance 3020-98 and the other seeking repeal of 3021-98, within twenty days after enactment of those ordinances. By memorandum dated January 6, 1999 and postmarked the following day, Respondent Klos rejected both petitions as insufficient, citing among other grounds failure to contain an adequate number of signatures. On January 21 and 22, 1999, Appellants, delivered to Ms. Klos their Amended TIF Referendum Petitions. By memorandum dated February 17, 1999, Ms. Klos rejected the Amended TIF Referendum Petitions as insufficient. The February 17th memorandum cited numerous grounds for rejection; the primary grounds relied upon, however, were: (1) that each of the two Petitions, even in their "amended" form, still contained an insufficient number of qualified registered voter signatures; and (2) that a referendum vote challenging either of the two ordinances in question was directly prohibited by the TIF Act and would thus be a violation of Article VI, 19(a) of the Missouri Constitution.

F. The Mandamus Action

On July 22, 1999, Appellants filed their Petition for Writ of Mandamus in the Circuit Court of St. Louis County, seeking to compel Respondent Klos: (1) to certify as...