ST. LOUIS — City officials on Wednesday rescinded more than $1.7 million in grants previously slated for North Side businesses and nonprofits, including one highlighted in the Post-Dispatch with ties to an alderwoman behind the grant program.
In all, seven businesses and nonprofits will lose funding, including a purported homeless services organization in line for $739,000, a building contractor expecting $500,000 and an online Black hair care business slated to get $250,000.
“Your project was unsuccessful in meeting the requirements for final approval for funding,” the city’s development agency said in letters sent to the organizations on Wednesday. “Based on the aforementioned information, your application is officially being removed from the competitive process.”
The decisions mark the latest twist for a troubled program intended to tackle one of Mayor Tishaura O. Jones’ top priorities: reversing decades of disinvestment and neglect on the city’s north side.
People are also reading…
The idea was that pumping more than $30 million in federal pandemic cash into hundreds of businesses and nonprofits would help restore vibrancy to forgotten corridors and offer opportunities to people left out for decades.
But since St. Louis Development Corp. officials announced the picks this summer, their decisions have come under increasing scrutiny. Post-Dispatch reporters found one announced winner, in line for $50,000, working out of offices in Shrewsbury. Several others listed addresses in vacant buildings. Dozens owed the city delinquent real estate taxes despite a stated requirement that they be current.
Three awards, worth nearly $1.3 million, were on course for entities with ties to the family of Alderwoman Shameem Clark Hubbard, who sits on SLDC’s board and sponsored a bill authorizing the grants. And the bulk of that cash was going to the People Project Corp., a homeless services organization run by Ebony Washington — the granddaughter of family patriarch Rodney Hubbard Sr., whose son, a lobbyist and former state representative, is married to the alderwoman.
By mid-September, SLDC chief Neal Richardson was testifying in front of an aldermanic committee, conceding some mistakes. One of his deputies also put blame on a contractor hired to vet applicants, saying some of the “viability assessments” had turned out to be inaccurate.
SLDC officials also emphasized that the vast majority of organizations awarded grants hadn’t yet received the promised money. And they assured the public that they were double-checking applications before cutting checks.
But until Wednesday, officials hadn’t rescinded a single grant. And even now, grants to more than a dozen questionable businesses remain pending, including ones to a computer services business headquartered in Shrewsbury, a museum that doesn’t open during advertised hours, a bar that’s been closed for three years, and a boxing gym that doesn’t exist.
Moreover, Carr Square Tenant Corp., run by Rodney Hubbard Sr., is still set to receive $500,000 to fix up a community center at the SLDC meeting on Thursday.
The letters sent Wednesday appeared to be the first time SLDC formally rejected applicants after their awards had been announced.
The letters were brief, mostly citing technical problems with the organizations’ plans for the grant money.
The letter to Washington, of the People Project Corporation, did not mention concerns about her family connections or how the corporation was only formed in August 2023, just a month after the mayor signed Clark Hubbard’s legislation broadening eligibility for the grants. Also unmentioned were the corporation’s apparent lack of a website, shelter building, or any other discernible public presence.
The problem, the letter said, was that Washington proposed using the $739,000 in grant money to rehab a residential property for her project. Houses and home-based businesses are not eligible for improvements paid for with federal pandemic money, officials said.
They cited the same rationale to deny money to four other organizations.
They said St. Louis Torchbearers 2, which advertises itself as a nonprofit supporting youth, wanted to use $100,000 of its $175,000 in grants to rehab houses on Dodier Street and Adelaide Avenue.
Home improvement firm Lux Renovations wanted to use $100,000 of its promised $125,000 to turn a house in the Penrose neighborhood into a showroom.
Building contractor Clark Construction proposed upgrades to a house in St. Louis Place described as rental, office and storage space.
Alayah Virgin Hair, the Black hair care business, wanted to turn a house in the Academy neighborhood into an office with space for business owner Veronica Walton to live as well.
The only outlier, Sigma Legacy, lost its $100,000 because its leaders said their rehab of a community center in the Jeff-Vander-Lou neighborhood would cost more than $600,000, and couldn’t say how it would make up the difference, SLDC said.
Most of the leaders of the businesses and nonprofits had little to say on the matter Wednesday. Washington, the purported homeless services provider, hung up after hearing about her letter.
Veronica Walton, of Alayah, said SLDC never said applicants couldn’t rehab houses.
SLDC spokesperson Deion Broxton, however, said federal guidelines were clear on that point.
He said the agency is still reviewing applicants.
View life in St. Louis through the Post-Dispatch photographers' lenses. Edited by Jenna Jones.
