The case for investing $15.5 million of taxpayer money in a new headquarters for the Laclede Group became more dubious over the weekend. We didn't think that was possible.

Tim Bryant of the Post-Dispatch reported Friday that in August, the firm's landlord at 720 Olive Street downtown offered the utility company $7 million in upgrades if it signs a new lease on the eight floors it occupies at its namesake building. The 31-story Laclede Gas Building would get new elevators, a renovated lobby, a fitness center and possibly other considerations just for staying put. Thus did the other shoe drop.

The Hertz Group of Santa Monica, Calif., owns the Laclede Building, as well as the Bank of America Tower and Equitable Building downtown.

By what we must assume is sheer coincidence, $7 million is precisely how much tax-increment financing money the Board of Aldermen is considering approving for a new Laclede headquarters. More than $8.5 million in state and federal tax credits also would go into the $46.4 million rehab project at the historic, but vacant, General American Life building at 706 Market Street.

Since the TIF bonds would be paid for over 23 years by diverting half of the 1 percent city earnings tax at the new headquarters, and since the city would be giving up the same amount in earnings taxes generated by employees at the current headquarters, the city in effect is handing a private company about $420,000 a year in tax revenue.

This is not a pure corporate welfare play, however. The city would see a benefit for its money: Life returned to the General American Life building, which has stood vacant in the heart of downtown for 10 years. Completed in 1977 and designed by Philip Johnson and his partner, John Burgee, the building is regarded as a significant work of modernist architecture. It is listed on the National Register of Historic Places.

Because of its open plazas and vast interior atrium, it is a challenging space designed as a signature headquarters for a single tenant. It has defied efforts by its owners, Centaur Properties of New York, to find such a tenant. But this year, the Koman Group of Creve Coeur approached Laclede, whose lease at 720 Olive must be renewed early next year.

Koman's proposal relies heavily on public financing. The question has been whether a 33 percent public lug is appropriate for fancy corporate offices, particularly in that Laclede is a public utility that already is allowed to pass certain business costs onto ratepayers.

We have argued that while historic tax credits might be appropriate, the TIF is not. The news that a regulated utility has been passing on $7 million in private incentives even as Koman negotiates for $15.5 million in taxpayer incentives is a matter that should concern the Missouri Public Service Commission.

REPRINTED FROM THE ST. LOUIS POST-DISPATCH