The Land Clearance for Redevelopment Authority Law ("LCRA Law"), Sections 99.300 to 99.715, RSMs, is one of several Missouri statutes intended to enable municipalities to curb urban blight and encourage the redevelopment of real property. In 1951, the Missouri legislature enacted the LCRA Law. Using the LCRA Law, government and private citizens have been able to work cooperatively to achieve the common goal of improving property values and fostering economic opportunities while improving the overall quality of urban life in Missouri.

Even before the LCRA Law was enacted, Missouri had several development tools in place. For example, in 1939, the Missouri legislature created the Housing Authorities Law and in 1943 the Urban Redevelopment Corporations Law was enacted. In the 1945 Missouri Constitution, the Missouri legislature was empowered for the first time to grant the power of eminent domain to public and private developers. At the same time, the legislature was authorized to grant real estate tax abatement to private developers.

The LCRA Law created a Land Clearance for Redevelopment Authority ("Authority") in every "community" in Missouri. Section 99.330, RSMo. "Community" is defined to include every county and municipality, except for municipalities with fewer than seventy-five thousand inhabitants. Section 99.320(6), RSMo. Fur municipalities with less than seventy-fire thousand inhabitants, the provisions of the LCRA Law must be accepted by a majority of the qualified voters of such municipality before an Authority is deemed "created." Section 99.320(6), RSMo. Although "created by the LCRA Law," before an Authority can transact any business or exercise its powers, the Authority must be approved, by ordinance or resolution, by the governing body of the community. Section 99.300, RSMo. The approval must be based upon two findings: 1) that one or more "blighted" or "insanitary" areas exist within the community, and 2) that redevelopment of such areas "is necessary in the interest of the public health, safety, morals or welfare of the residents of such community." Section 99.330, RSMo.

The terms "blighted" and "insanitary" are defined in Section 99.320, RSMo, of the LCRA Law:

"Blighted area," an area which, by reason of the predominance of defective or inadequate street layout, insanitary or unsafe conditions, deterioration of site improvements, improper subdivision or obsolete platting or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, retards the provision of housing accommodations or constitutes an economic or social liability or a menace to the public health, safety, morals, or welfare in its present condition or use.

"Insanitary area," an area in which there is a predominance of buildings and improvements which, by reason of dilapidation, deterioration, age or obsolescence, inadequate provision for ventilation, light, air sanitation or open spaces, high density of population and overcrowding of buildings, overcrowding of land, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, is conducive to ill health, transmission of disease, infant mortality, juvenile delinquency and crime or constitutes an economic or social liability and is detrimental to the public health, safety, morals, or welfare.

The powers of an Authority are exercised by its Board of Commissioners ("Board"). Section 99.350, RSMo. The Board of an Authority is made of five commissioners who must each be a taxpayer who has resided in the community for at least five years. Section 99.340.2, RSMo. In counties, the governing body of the county appoints the commissioners to the Board, while in municipalities, the commissioners are appointed by the mayor. Section 99.340.1, RSMo. The terms of the initial commissioners appoint to the Board are staggered in such a manner that the term of at least one commissioner ends each year for the first four years the Board Exists. Section 99.340.3, RSMo. Thereafter, commissioners are appointed to serve for a term of four years, except that all vacancies are to be filled for the unexpired term. Section 99.340.3, RSMo. Commissioners are not paid a salary, but are entitled to the necessary expenses incurred in the discharge of the commissioners' duties, including travel. Section 99.380, RSMo.

The Board elects a chairman and a vice-chairman from among the commissioners, although the first chairman of a Board of an Authority created in a municipality is appointed by the mayor. Section 99.350.2, RSMo. The presence of a majority of the commissioners at a Board meeting constitutes a quorum. Section 99.350.1, RSMo. In order for an Authority to act, there must be an approving vote cast in favor of such action by a majority of the commissioners present at a Board meeting at which a quorum is present. Section 99.350.1, RSMo.

An Authority may engage employees or agents to assist the Authority in the exercise of its functions, such as an executive director, technical experts, and "such other officers, agents and employees, permanent and temporary, as it may require." Section 99.350.2, RSMo. An Authority may also consult the "chief law officer" of the community in which the Authority operates or may engage in own counsel and/or employ its own legal staff. Section 99.350.2, RSMo.

An Authority is a "public body corporate and politic" and is granted all the powers necessary or convenient to carry out and effectuate the purposes of the LCRA Law. Section 99.420, RSMo. Besides this general grant of power, the LCRA Law specifically grants each Authority the powers enumerated in Section 99.420, RSMo.

Within its area of operation an Authority has the power to acquire and dispose of both real and personal property by purchase, lease, eminent domain, grant, bequest, devise or gift. Each acquisition by an Authority must be necessary or incidental to an urban renewal or redevelopment project of the Authority.

An Authority may also make improvements on land, including the construction of roads, streets, and public utilities. An Authority may encumber its land with covenants and restrictions, which may be covenants running with the land.

An Authority may borrow and lend money as well as accept contributions from public or private sources for the purpose of exercising its lawful powers. An Authority is also authorized to spend money necessary to the exercise of its powers, to invest money, and to issue bonds. (See Paragraph VII, below.) An Authority may then loan the proceeds of bonds or notes to developers and such proceeds may be used to purchase, construct, extend, or improve projects by public or private developers.

An Authority has the power to prepare urban renewal and redevelopment plans, to cause them to be prepared, and to recommend their passage to the governing body of the community in with the Authority operates. Urban renewal and redevelopment plans may provide for the repair and rehabilitation of buildings, and may include plans to ensure compliance with any laws, codes, and regulations relating to the use of land and buildings, as well as to provide for relocation assistance for families which are displaced by Authority projects.

An Authority may also conduct tests or have tests conducted, including surveys, studies, appraisals, and other investigations, and is authorized to enter private property to conduct these tests.

An Authority also possesses basic legal rights including the right to sue and be sued, and the right to contract. An Authority may delegate its authority to plan or undertake Authority projects to other public bodies. Finally, An Authority may also "exercise all powers or parts or combinations of powers necessary, convenient or appropriate to undertake and carry out land clearance, redevelopment and urban renewal plans and projects and all the powers herein granted." Section 99.420(14), RSMo.

An Authority is not authorized to acquire any specific parcel of real property for an Authority project until it has prepared an urban renewal or redevelopment plan and secured the adoption of that plan by the governing body of the community in which the Authority operates. Section 99.430.1(1), RSMo. There are two preconditions to the approval of an urban renewal or redevelopment plan. The governing body of the community in which the Authority operates must adopt a general plan for the development of the community as a whole, and must declare the area to be redeveloped or rehabilitated pursuant to each urban renewal or redevelopment plan to be declared blighted or insanitary and in need of redevelopment or rehabilitation. Section 99.430.1, RSMo.

Urban renewal or redevelopment plans may be submitted by the Authority or by any public or private person or agency. Section 99.430.1(3), RSMo. Each plan must be sufficiently complete to indicate its relationship to community objectives relating to land use, traffic concerns, public transportation, public utilities, recreational and community facilities, building requirements and other public improvements. Section 99.430.1(4), RSMo. An urban renewal or redevelopment plan must also include a description of the boundaries of the proposed urban renewal or redevelopment area, and a map showing the existing uses and conditions of the real property in the proposed urban renewal or redevelopment area. Section. 99430.1(4)(a), RSMo. Each plan must state the proposed land uses for the are, information on population densities, proposed changes in zoning ordinances, maps, and street layouts, as well as a schedule showing the estimated length of time needed to complete each phase of the plan. Section 99.430.1(4), RSMo.

Prior to submitting a plan to the governing body of the community in which the Authority operates, an Authority must submit the urban renewal or redevelopment plan to the community's planning agency for review and written recommendations. Section 99.430.1(5), RSMo.

Prior to submitting an urban renewal or redevelopment plan for approval, an Authority must also determine that the proposed uses for the real property within the proposed urban renewal or redevelopment area are consistent with the purposes of the general plan for development within the community. Section 99.430.1(6), RSMo. An Authority must also determine that a proposed urban renewal or redevelopment plan will promote health, safety, morals, order, convenience, prosperity, and the general welfare of the community. Section 99.430.1(6), RSMo.

After following the statutory procedure, an Authority may then submit the urban renewal or redevelopment plan to the governing body of the community in which it operates, together with its recommendations, the planning agency's recommendations methods and costs of completing the project contemplated by such urban renewal or redevelopment plan, anticipated proceeds and revenues from the disposal of the land in the urban renewal or redevelopment area to developers, proposed financing, a plan for relocation assistance for families displaced by the project, and a timeline for completion of each phase of the urban renewal or redevelopment plan. Section 99.430.1(7), RSMo.

When considering an urban renewal or redevelopment plan, the governing body of the community is required to hold a public hearing at which interested parties must be given a reasonable opportunity to speak. Section 99.430.1(8), RSMo. Public notice of the hearing must be given by publication in a newspaper or general circulation once a week for two consecutive weeks with the last publication date being at least ten days prior to the hearing date. After the hearing, the governing body may approve the urban renewal or redevelopment plan. Section 99.430.1(9), RSMo.

Any urban renewal or redevelopment plan that is not approved by the governing body of the community in which an Authority operates may be modified by the Authority and resubmitted. Section 99.430.1(9), RSMo. An Authority may modify a previously approved urban renewal or redevelopment plan. Section 99.430.1(10), RSMo. If, however, the modification occurs after the lease or sale of land in the project area, the redeveloper selected pursuant to the urban renewal or redevelopment plan must consent to the changes. Section 99.430.1(10), RSMo. If the modification is a substantial change, the governing body of the community in which the Authority operates must also approve the changes. Section 99.430.1(19), RSMo.

The LCRA Law also includes an alternative and expedited procedure by which urban renewal or redevelopment plans can be considered and approved. Section 99.430.2, RSMo.

An Authority may sell, lease, exchange or otherwise transfer, at "fair market value," real property in an urban renewal or redevelopment area in any developer for residential, recreational, commercial, industrial, or other uses or for public use in accordance with the urban renewal or redevelopment plan. Section 99.450(1), RSMo. The fair market value is to be determined by the Authority, which must consider a number of factors including the uses and purposes of the land, restrictions on the land, objectives of the urban renewal or redevelopment plan, and other appropriate matters as determined by the Authority. Section 99.450(1), RSMo. The Authority must also consider appraisals of the property made by appraisers employed by the Authority in determining the fair value for the rental or sale of land. Section 99.450(1), RSMo. Public notice must be given before land is sold by an Authority in order to invite proposals and make information available to private redevelopers or other interested parties. Section 99.450(2), RSMo.

In carrying out the objectives of an urban renewal or redevelopment plan, an Authority may also grant servitudes, easements, and rights-of-way for public utilities, sewers, streets and other similar facilities. Section 99.450(3), RSMo. Similarly an Authority may convey land to the community to be used as streets, alleys, or public ways and may convey to government entities property to be used as schools, parks, public buildings, facilities, or other public purposes. Section 99.450(3), RSMo. An Authority may also dispose of real property in urban renewal or redevelopment areas by conveying it to private redevelopers under reasonable competitive bidding procedures. Section 99.450(2), RSMo. An Authority may exercise the power of eminent domain to acquire land necessary to a project being completed pursuant to an urban renewal or redevelopment plan. Section 99.460, RSMo.

An Authority may develop vacant land for residential purposes even though such land is not in a blighted or insanitary area if the governing body of the community in which the Authority operates determines that the acquisition of the land is both essential to the proper clearance or redevelopment of blighted or insanitary areas or is a necessary part of the community's general land clearance program. Section 99.470, RSMo. Before the Authority may develop such land, however, the governing body of the community must also find that there is a shortage of decent, safe, and sanitary housing in the community, that the land will e developed primarily for residential purposes, and that the provision of the residential accommodations on the vacant land is necessary to relocate families displaced from redeveloped blighted or insanitary areas. Section 99.470, RSMo.

An Authority has the power to issue taxable or tax-exempt bonds to fund any of its corporate purposes and may issue refunding bonds to retire bonds previously issued by the Authority. Section 99.480, RSMo. The Authority may issue any type of bond it deems appropriate, including revenue bonds, the principal and interest of which are payable exclusively from revenue derived from Authority projects financed in whole or in part by the bonds. Section 99.480, RSMo.

An Authority must sell its bonds at no less than ninety-fire percent of the par value of the bonds. Section 99.490.2, RSMo. An Authority may sell its bonds at a private sale only if it determines that a private sale is in the best interest of the Authority; provided, however, any issue of bonds in excess of ten million dollars must be sold publicly. Section 99.490.2, RSMo. Whether the sale of bonds is public or private, the Authority must publish notice of the sale in a newspaper of general circulation in the community in which the Authority operates at least once and not later than ten days prior to the sale. Section 99.490.2 RSMo.

The Supreme Court of Missouri held in LCRA v. Waris, 790 S.W.2d 454 (Mo. Banc 1990), that the Authority operating in Kansas City, Missouri was as part of the municipal structure of the City of Kansas City, Missouri, and that the Authority was therefore exempt from property taxes under Article X, Section 6 of the Missouri Constitution. An Authority may therefore purchase personal and real property and lease that property to a redeveloper, who then is not required to pay personal an/or real property taxes on the property.

Sales of tangible personal property to an Authority may also be exempt from the imposition of sales and/or use taxes. Article III. Section 39(10) of the Missouri Constitution prohibits the general assembly from imposing a "use or sales tax upon the use, purchase or acquisition of property paid for out of the funds of any county or other political subdivision." Based upon Waris, since the Authority is a part of the structure of either the county or municipality in which it operates, it is exempt from the payment of sales and use tax when purchasing otherwise taxable personal property since the funds of the Authority would be funds of the community in which it operates.

In addition, pursuant to the LCRA Law, in any constitutional charter city, any person may apply to that community's Authority for certification that real property owned, leased or rented by such person is located in a blighted area that the governing body has declared to a blighted area. Section 99.700, RSMo. After an Authority receives acceptable plans demonstrating that the person making the application is engaged in new construction or rehabilitation of real property in accordance with an approved urban renewal or redevelopment plan, the Authority shall issue a certificate of qualification for tax abatement to the applicant. Section 99.700, RSMo.

The LCRA Law is an excellent tool for encouraging the development of property and curbing urban blight. By encouraging the redevelopment of blighted or insanitary areas, urban areas can be economically renewed. The LCRA Law has been and will continue to be a benefit to increasing economic development in the urban communities of Missouri.