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ST. LOUIS — Mayor Tishaura O. Jones made a rare appearance at the Board of Aldermen late last year to assure members that reported problems with a North Side grant program were temporary and that mistakes would be corrected.

"We have every intention of making sure these dollars are spent with integrity," Jones said.

Four months later, the city still has work to do.

A Post-Dispatch review of records for the 444 announced grant winners, visits to more than 60 locations and scores of interviews showed dozens of awards are still slated to go to organizations that appear to be less than the upstanding North Side firms they are supposed to be. Others are on course for firms without the resources to pull off promised proposals.

Among the cases the Post-Dispatch investigated:

• Twenty-seven of the organizations, in line for $515,000, do not appear to be operating, or are barely operating. Pennie’s Love LLC, for instance, purports to run temporary housing for the homeless but lists an address in an empty lot.
• Nine firms, in line for $195,000, were operating — but not out of north St. Louis. Two are downtown. And three are in the Central West End.
• At least eight others, in line for $227,500, can’t deliver on proposed projects because they don’t have enough money. A $100,000 grant coming to the Alice Wooten Banquet Center, for instance, isn’t nearly enough to make its building presentable, a leader said.
• Forty grant winners, in line for more than $1 million, owed more than $230,000 in delinquent property taxes. One, a day care center in line for $20,000, owed the city collector more than twice that amount.

The Post-Dispatch review marks the fullest accounting in the city's handling of one of its highest-profile programs, paid for with $37 million in federal pandemic aid.

“It’s horrible to hear,� said city Comptroller Darlene Green, who has called for an overhaul of the program. “It’s a slap in the face to the long-term, legitimate business owners of north St. Louis. It’s appalling.�

The program is supposed to be a big step toward reversing years of disinvestment in long-neglected neighborhoods. The mayor has cast it as a critical part of her administration's work to spark a North Side renaissance.

But earlier Post-Dispatch reports of money going to businesses in vacant buildings and owners with political connections raised questions about the city’s due diligence and ability to ensure taxpayer money is being put to good use. Aldermen called for audits. Green called for an “immediate do-over� of the program. U.S. Sen. Eric Schmitt referred the matter to the Treasury Department.

In the weeks since, the city has rescinded at least $2.2 million in grants, including more than $800,000 set to go to organizations questioned in Post-Dispatch stories.

The St. Louis Development Corp., the city agency overseeing the grants, did not directly comment about most of the organizations in question, citing privacy rules for pending grants. Spokesperson Deion Broxton disputed the Post-Dispatch's findings in a handful of cases.

For example, the Post-Dispatch flagged a diner on North Broadway that has cut staff and stopped opening most days. Broxton said it still qualifies for a grant because it is at least active on some days. There was also an online clothes retailer that has yet to sell clothes online; Broxton said it is still considered operating if it's trying to open. Also, he said, businesses that didn't get enough money for planned expansions, as owners outlined, are still allowed to spend grant money on existing rent, mortgages and utilities.

Broxton added that SLDC is still reviewing other grant winners.

“SLDC staff members are actively vetting those pending businesses you named,� Broxton wrote in an email.

On the issue of delinquent property taxes, he reiterated previous SLDC statements that only grant winners using the money to build or renovate buildings need to be current.

However, agreements SLDC signs with all grant winners say otherwise. They require recipients to affirm they owe “no outstanding taxes to the City of St. Louis.�

Alderwoman Pam Boyd, who represents a large swath of the North Side, said SLDC's explanations made no sense.

"Why would we give money to a business that's not even open?" she asked.

More than 700 applications

The grant program sprang up more than three years ago. The city was in line for a significant chunk of federal cash, and leaders wanted a big slice for North Side commercial corridors.

Aldermen initially approved $33 million to help businesses complete building projects along four main roads. Grants could pay for up to 45% of projects involving demolition for new construction and 65% of a rehab, and the business owner would cover the rest.

Then Jones and other aldermen tweaked the program over the next two years. The budget grew. Amendments made businesses across the North Side eligible for grants, not just those along main roads. They also created new kinds of awards that didn’t require the money to go to building projects or make grantees put up their own money.

When applications opened, more than 700 poured in, from firms big and small. It was to be one of the higher-profile programs in recent memory for SLDC, who for years had done its most visible work evaluating tax incentives for real estate development.

Then, in June 2024, SLDC announced roughly 270 businesses and nonprofits as winners. A few months later, under fire from frustrated applicants who didn’t get any money, SLDC announced $12,500 grants to 159 more — even though they had been rejected because their plans were deemed less attractive and viable than the winners.

Things started to go wrong.

The Post-Dispatch reported that three awards worth nearly $1.3 million were poised to go to organizations with ties to Alderwoman Shameem Clark Hubbard, who sits on SLDC’s board and sponsored a bill expanding eligibility for the grants.

Another story raised questions about a museum that didn’t open and a computer services company headquartered in Shrewsbury.

In the wake of the reporting, SLDC announced a temporary halt to the program and promised to double-check everything before signing any more checks. It also vowed that every firm getting money would have to be a viable, operating organization capable of completing its projects. Everyone would have to sign forms affirming they owed “no outstanding taxes to the City of St. Louis.�

SLDC officials also said that despite the publicity, the problems with the grants were likely small. Perhaps 2% of awards needed a second look, one official said.

A full review

After its initial reports, the Post-Dispatch began reviewing records for each of the 444 entities announced as grant winners, including applications provided by SLDC and registration documents, business licenses, tax records and occupancy permits.

The newspaper also ran addresses through Google StreetView, looked up nonprofits in IRS data and read through company websites.

Several, like the Urban League of Metropolitan St. Louis and the Herbert Hoover Boys & Girls Club, were such well-known north side institutions as to be obviously eligible.

Many others were less obvious, but they had all of their paperwork in order. ÁñÁ«ÊÓƵ were registered with the state, had a current city business license and relevant building or occupancy permits at the addresses where they said they did business.

But 186, more than a third of the grant winners, were more questionable.

Some wrote about their business in their applications in the future tense, as if they didn’t yet exist. Some appeared to be missing key paperwork, like an occupancy permit at a purported headquarters. Others had websites containing vague language and stock photos — and occasionally an address outside the city.

Out of the 186, Post-Dispatch reporters looked into a sample size of 84. They visited many of the locations and interviewed dozens of business owners.

From the sample, they found that at least 52 companies appeared to fall short of the program’s requirements. Those 52 were in line for grants worth more than $1 million.

SLDC records indicated that as of last month, they had rescinded $175,000 in grants to eight of those organizations over the course of the Post-Dispatch's review. They included three mentioned in the newspaper's stories: La Rose Room, a bar that had been closed for three years; St. Louis Mississippi River Museum, which didn’t open during advertised hours; and a company called 4437 & 39 Dr. Martin Luther King Professional Building, LLC, based in a vacant building on Martin Luther King Drive.

SLDC also rescinded $1.7 million in grants to six other entities, including $764,000 in grants to a purported homeless services organization led by a Hubbard relative.

'Viable, operating' businesses

Many of the businesses reviewed by the Post-Dispatch didn't appear to be operating, or were barely operating.

Multiple SLDC officials, including CEO Neal Richardson, have said grant winners must be “viable, operating� businesses. SLDC staff and third-party contractors are supposed to check payroll records and visit businesses in person to ensure they are what they say they are.

But Pennie’s Love, in line for a $25,000 grant designed to help businesses maintain or expand existing operations, is an example of an entity that doesn’t appear to be operating.

The address listed in its application, on Aldine Place, is a vacant lot. A recent visit found nothing but unkempt grass and assorted trash, including a shredded tire. City records showed no outstanding building permits heralding change.

Owner Shelice Gillard said work to build transitional housing will begin later this year. “It’s getting built,� she said.

She said she’ll have help from Robbie Montgomery, the restaurateur and former backup singer for Ike and Tina Turner, to supplement the $25,000 grant.

But that was news to Montgomery and her business manager, Charles Bussey. Montgomery said she has an option on several parcels in the area and has been looking for businesses interested in moving there.

“But I don’t know her,� Montgomery said.

Renovation Engineering Technology, also in line for $25,000, described itself in its application as a “multi-business organization,� combining drug rehabilitation, food service and construction.

But the building at its address on North Market Street, in the Ville neighborhood, had boards over its window frames.

Renovation Engineering’s owner, Cornest Hall, said he hopes to turn the building into a grocery store. He showed a Post-Dispatch reporter new wood framing he had put in where he hopes walls will eventually go.

He said he wants to turn an adjoining building into a burger joint, counseling center and office for his construction firm.

But after three years of work, the buildings lack finished ceilings and walls, are still covered in dust and lack electricity.

“It’s not operating, per se,� Hall said.

Hall had hoped for a $1 million grant to change that, instead of the $25,000 he is slated to receive, but it didn't happen.

“If I’d gotten a million,� he said, “I feel like I would have been well on my way to doing everything.�

Halo Demolition, also getting $25,000 for expansion, appeared to have a similar problem.

Despite its name, it has yet to do any demolition.

The owner, Rufus Shannon, said he has been looking to break into the demolition business for the last five years. But between his health, at 72 years old, and the pandemic, he hasn’t been able to do much.

"I haven't been able to get to it,� he said.

The other problem, he said, is that he lacks demolition equipment, like a dump truck, a bulldozer and an excavator.

He applied for a $175,000 grant to buy a dump truck so he could apply for debris hauling contracts and fix up his home office.

The $25,000 won’t be enough for that, he said, but maybe it could be a down payment.

A remarkable number of the consolation grants — the $12,500 payments offered to applicants that lost out on the larger, competitive awards — also appeared destined for companies with minimal, if any, operations. Among the examples:

• Ashlee Renee Investments plans to build a network of electric vehicle charging stations across the city, including at least one in north St. Louis. But its owner said the company hasn’t set up any yet.
• Henlor Corp. would be a call center. But its owner said the company needed grant money before it could hire employees to start taking calls.
• GRO: Farm bills itself as a farm, but the address listed on its $1.8 million grant application is a vacant lot. Its owner declined comment.

Located where?

Other grant winners reviewed by the Post-Dispatch don’t appear to be in north St. Louis.

The legislation that created the grant program is clear on the geographic restraints. The grants are to be for businesses “on or to the north of Delmar Boulevard,� a dividing line between the city's central corridor — which includes downtown, Midtown and the Central West End — and North Side neighborhoods.

Nana and Jack's Home Healthcare Service, in line for a $25,000 grant, is headquartered downtown on Washington Avenue.

Leaders said in their application they want to fix up a building on West Florissant Avenue, which is north of Delmar. The company asked for $1.2 million to do it; it's not clear what it would do with the $25,000 it is slated to receive.

Most of the doors and windows in the building are boarded up. There’s an old, broken sign over the front door. And a glimpse into the building reveals it's mostly gutted, with little more than wood framing inside and holes in the only visible wall.

The last building permit was pulled in 2014, for a daycare that’s long gone, if it was ever completed.

The owner, Tameisha Taylor, of Belleville, refused to speak about the grant on the phone and could not be reached at her downtown office.

Several of the smaller, $12,500 consolation grants appeared to be in similar straits.

ABNA Engineering, for instance, is headquartered on Lindell Boulevard in the Central West End.

The company said in its application it wanted to fix up a building its founders own on Delmar Boulevard. But the building was described as being in severe disrepair, unsuitable for any productive use.

The company requested $238,000 to fix it up, and got just 5% of that.

A series of visits to the Delmar address during normal business owners found no activity, and no building permits have been filed.

Nonprofit R.E.S.T., in line for $12,500, had a similar issue.

It's based in north St. Louis County, where founders said they run a food pantry. Johnetta Williams, working with husband Kenneth Williams, said the organization had expansion plans. ÁñÁ«ÊÓƵ wanted to expand curriculum at Walbridge elementary school in the Walnut Park area, and beautify the surrounding neighborhood.

But it all rode on a $1 million grant. For now, Kenneth Williams said, R.E.S.T. is focused on raising money to rehab a building in the Pine Lawn suburb, for homeless veterans.

“Right now we're not doing anything in north St. Louis,� Johnetta Williams said.

Project in question

There were also grants headed toward firms that proposed projects that won't get done, raising questions about whether the money is being used in the most effective way possible.

The largest project in jeopardy, the Alice Wooten Banquet Center, is in line for $100,000.

The Williams Temple Church of God in Christ, at Union Boulevard and Martin Luther King Drive, wants to turn the former Sweet Timez nightclub into a banquet center for the community.

But right now, there’s a board over the door. Shirley Wooten, who’s in charge of the project, said it needs new equipment, ceiling fixes, an upgraded kitchen and refreshed bathrooms. She said getting that done will cost five times what the city is set to send her.

“In no way will that be enough to finish,� Wooten said.

For the current amount, she said, workers could get the carpet ready and move some walls.

“I don’t think we could do enough to open up,� she said. “Maybe we could go after some other grants.�

Jacob Barker of the Post-Dispatch contributed to this report.