A group of downtown property owners and managers announced its opposition to the Harbor Point tax increment financing plan Tuesday, a day before the City Council's taxation committee is set to hold another meeting on the legislation.
"You can't develop in a vacuum," said David E. Johnson, president of Stratford Realty Management.
Mayor Stephanie Rawlings-Blake's administration's argument for $107 million in city assistance for developer Michael S. Beatty's Harbor Point development does not take into account the damage that could come to downtown if a new office park is built on the peninsula between Harbor East and Fells Point, he said.
Opposition by the broad-based Downtown Management Authority, which represents more than 1,200 property owners, has the potential to sway members of the council, who must approve legislation for the proposed tax increment financing. So far, most public resistance to the proposal has been voiced by Carl Stokes, chairman of the taxation committee; his supporters; and a nonprofit organization, Westside Renaissance, that focuses on revitalizing the Howard Street corridor.
The board of the DMA released an eight-page statement on Tuesday outlining its opposition to the Rawlings-Blake tax plan, which would allow the city to issue bonds to pay for roads, pipes, public parks, a promenade and other infrastructure at Harbor Point. Under the plan, Beatty's development company would be required to pay back both the bonds and interest through projected tax revenue.
"It makes little sense to fund the construction of brand new infrastructure when existing infrastructure needs assistance, or to require the DMA to piece together limited public funds over an extremely long time period for infrastructure problems that plague it today, while Harbor Point is permitted to borrow extraordinary amounts to accomplish its work immediately," the board wrote.
The DMA board, its statement said, "would have less objection" to the Harbor Point proposal if the downtown district also had the opportunity to receive bond funds or if both locations had to "compete for general obligation funds as they became available."
"All we're saying is make a level playing field," Johnson said.
Harbor Point, the mostly vacant 27-acre site of the former Allied Signal chromium plant, is set to become the new home for energy company Exelon's new regional headquarters and is planned as the site of several other buildings, both residential and commercial. With bakery magnate John Paterakis, Beatty founded the development company that built Harbor East.
Harbor Point is in a different situation from downtown, which doesn't need the same level of infrastructure investment, Rawlings-Blake said Tuesday in a statement.
"The public investment being made at Harbor Point is for public infrastructure that does not currently exist," she said. "Downtown has and will continue to benefit from the types of public infrastructure proposed at Harbor Point — roads, public parks, utilities, and landscaping. In the case of Harbor Point, the City is providing public infrastructure required for private development — the same public infrastructure that exists in Downtown as a result of City investment."
The DMA, which sets a special tax surcharge for its members, uses private funds to contract with the Downtown Partnership of Baltimore Inc., a nonprofit corporation. The partnership then provides public-works services, including cleaning and maintenance of downtown streets and sidewalks, for the central business district.
The DMA's board is distinct from the partnership's board, which is a larger entity and includes more office tenants and civic leaders. The partnership's board endorsed the tax increment financing plan in a letter in July to the City Council, although that board expressed a concern that Harbor Point development could transfer jobs out of the downtown business district.
"The partnership feels that this development builds on the success of Harbor East and will provide important benefits to the people of Baltimore, including job creation, new retail and entertainment options, open space on the waterfront, and tax revenues for decades to come," wrote Kirby Fowler, president of the partnership.
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