The $513 million portion of the Rams settlement has been sitting in no- and low-interest bearing accounts for seven months.
ST. LOUIS — There’s been a lot of talk about the $790 million settlement St. Louis city, county and the Regional Sports Authority won against the Rams and the NFL but seemingly little action.
After attorney’s fees, about $513 million was awarded to the plaintiffs seven months ago.
Ever since, 11 members of a board have been trying to determine how to divide the money among the city, county and Regional Sports Authority, which manages the Edward Jones Dome.
Now, the I-Team has learned the money could have been working a lot harder for the region and has lost out on an untold amount of interest money.
The board has made a move Wednesday to start earning higher interest on the money as negotiations on how best to divide it among the three plaintiffs continue.
Board Chairman the Rev. Earl Nance Jr. said he’s confident St. Louis Mayor Tishaura Jones and St. Louis County Executive Sam Page will support moving the money into a higher-interest bearing account and will likely reach a settlement on how to divide the money by the end of the year.
So why not just divide up the money equally three ways and be done with it?
Nance said the Regional Sports Authority would “love that” but city and county leaders “haven’t gone along with us.”
“We appreciate the public’s patience, patience with us all,” Nance said. “We accept the responsibility that we have.
“And these kinds of things take time. When you’re dealing with millions of dollars going through three different entities, it’s not going to be a speedy process. There’s going to be a deliberate process. But hopefully before the end of the year, we’ll have something to report.”
The Regional Convention and Sports Complex Authority, which operates the Edward Jones Dome, has an 11-member board.
Three members are appointed by the mayor of St. Louis, three are appointed by the St. Louis County Executive and five are appointed by the governor.
The board sued Rams owner Stan Kroenke and the NFL after Kroenke moved the team to Los Angeles in 2016.
St. Louis City and County joined the lawsuit and are now among the plaintiffs trying to figure out how to split the settlement.
There has been a fair share of turmoil among the board.
Three new faces attended their first meeting as commissioners Wednesday.
And local political leaders have called for more transparency into the process.
Nance defended the board’s decision to negotiate in secrecy.
“People have to be able to speak freely and candidly and not be thrown out in public to be interpreted and misinterpreted,” he said.
Missing out on millions
Among the new faces to join the board Wednesday was David Spence, who was appointed by Gov. Mike Parson.
He was confirmed in March.
For the first 60 days after the $513 million was awarded, it was put into a non-interest-bearing account. For the past four months, it has been sitting in a low-interest account, Spence said.
Put $513 million into an account with even just a 1% interest rate, and actuaries tell the I-Team, you’re talking about an extra $5 million a year – just for sitting there.
“I was not a part of those decisions,” Spence said. “All I can say is the current board believes it’s time to make our money start working for us while we take our time and decide how this money is going to be spent.”
Nance was part of the decision, and said the money wasn’t moved into higher-interest accounts simply because: “Nobody ever brought it up.”
Spence and Nance were part of a unanimous decision Wednesday to ask city and county leaders to move the money into a high-interest account.
So was Joseph Blanner, who also is a Parson appointee that started his term on the board in March.
He said the money is currently being held in a Commerce Bank account earning 40 basis points.
“We’re looking into available options for a higher interest-earning investment that would comply with the three different jurisdictions’ investment policies, and so we have to find a vehicle that would increase the interest rate, while at the same time comply with the three different entity’s investment policies and get approval of all three entities.”
Blanner added all three parties are “a ways off” from starting to spend their slice of the settlement.
“So, in the intervening period, why wouldn’t we to be good stewards of that money? Why wouldn’t we want to earn the highest rate of interest on it that we can?” he said.
“We have a once-in-a-generation opportunity here to change the region, so why rush it?” he said. “Let’s take our time and really invest this money into good safe investments, and I’m talking safe investments backed by US Treasuries.
“We’re really not trying to rule from behind the curtain here, we all really want to be good stewards of this money. If we get even a whiff of a potential for this money being wasted, we’re not going to settle.”
Whether Page and Jones will support moving the money into higher-interest-bearing accounts is unclear.
Page’s spokesman did not reply to multiple requests for comment from the I-Team.
Jones’ office issued a statement, which didn’t answer the question directly.
It read: “Mayor Jones has worked to make smart investments throughout her career as financial professional and City Treasurer. During her tenure as Treasurer, Jones adjusted St. Louis’ investment strategy, yielding millions of dollars in returns for the City. She remains committed that any funds the City procures through this historic agreement must be invested responsibly with an eye towards our children and grandchildren – not the next election cycle. We cannot take a hammer to the political piggy bank, or our future generations will end up paying the price.”
Spence said, “I don’t know anybody who could put their head down at night and say, ‘This is not a good idea.’”
When will a settlement happen?
Spence noted the city and county have millions in ARPA funds that can help alleviate any immediate needs, so settling quickly to disperse the Rams lawsuit settlement money seems like a mistake.
“We think this money should be used specifically for things like economic development that will make that money work even more for the community.”
Nance said he believes city and county leaders can determine how best to spend their share of the settlement, whatever that amount may be.
“We have no business telling the city or the county how to spend their share, that is up to them,” Nance said. “They’re going to do what they feel is best for the entire community and for their constituency.”
Nance said he believes the city, county and Regional Sports Authority will be able to reach a settlement agreement among themselves before the end of the year.
“In the long run, (the city and county) probably will get more than a third,” Nance said. “As long as The Dome gets its fair share of the revenue so we can run the Dome for the next several years. We think that’s very fair. Actually, you know what? If it hadn’t been for RSA, there’d be no settlement. Because we were the ones that filed the lawsuit, and city and county joined us.”
Spence said he agrees with a statement Jones made about how the settlement needs to be “something our grandkids can be proud of.”
“The public needs to know we’re alive and kicking and here’s an example of our good decisions, i.e. putting the money in high-interest investments,” he said. “We’re putting a SWAT team on it because every day, we’re losing money.”