(The Center Square) – A select few St. Louis and Missouri money managers are receiving two big orders worth almost half a billion dollars.
The City of St. Louis and St. Louis County announced Thursday they will invest approximately $449 million received in 2021 from the National Football League’s Los Angeles Rams to settle a lawsuit. The governments received criticism for holding the funds in low-interest accounts during months-long negotiations to determine how to split the money. In addition to the city and county, the St. Louis Regional Convention and Sports Complex Authority (RSA) was a plaintiff in the lawsuit and will receive approximately $70 million.
The city announced it will deposit its $280 million with the Missouri Securities Investment Program (MOSIP). The county announced it will invest $169.3 million, which includes interest received on the funds since they were first invested last year. A media release from the county said it’s “working with brokers to get the best return on investment” and the maturity of the notes range from six to 11 months.
“By putting this money into Treasury Bonds, we can continue to collect high-yield interest while having thoughtful conversations with the community and the council on the best way to use these funds,” County Executive Sam Page said in a statement announcing the actions.
MOSIP was created by state statute in 1991 to provide authority to Missouri’s political subdivisions to pool funds for a common service when authorized to do so, according to information on its website. It adheres to state investment guidelines.
The law firms representing St. Louis – Dowd Bennett LLP and Blitz Bardgett & Deutsch – received approximately $276.5 million or 35% of the settlement, plus reimbursement of additional costs.
The city and the county are in the early stages of developing a strategy or plan for spending the funds. Greater St. Louis Inc., an organization representing businesses throughout the city, county and parts of southern Illinois, strongly urged St. Louis government leaders to follow the lead of economic trusts or funds in other metropolitan areas. It suggested following Indianapolis, Ind. (Lilly Endowment), Tulsa, Okla. (Tulsa Community Foundation), Kalamazoo, Mich. (Kalamazoo Foundation for Excellence), or Northwest Arkansas (Walton Family Foundation).
“I’ve said time and time again, we cannot and we will not take a hammer to the political piggy bank to spend the Rams settlement funds,” St. Louis Mayor Tishaura Jones said in a video posted on social media on Thursday. “As we develop a community-driven plan to use this money to make change for our future generations, the city will invest it responsibly and our fund will continue to accrue interest.”
Jones highlighted the funds don’t have the restrictions of federal American Rescue Plan Act funds, which must be spent by 2026. However, the settlement agreement requires $30 million of the city’s $280 million share be appropriated by the Board of Aldermen before June 30, 2023, to keep the funds in the city by spending them on the convention center. If aldermen fail to meet the deadline, the city must give the $30 million to the convention and sports authority.