Darrell Doan, the BDC's managing director of real estate development, emphasized that the developer — and not the city — would be responsible for paying back the approximately $281 million in bonds and interest. He called the financing plan the "lowest risk" deal of its kind that exists.

The Greater Baltimore Committee, a leading business group, also issued a statement in favor of the project, but was critical of some aspects of the plan. The organization recommended the city approve only $34 million in bonds for the first phase of the project and consider the other parts at a later time.

Donald C. Fry, who heads the group, wrote in a letter that while Beatty's development team would legally be responsible for repaying the bonds, the city would have a "moral" obligation to pay investors should the project fail.

"The Executive Committee of the GBC is concerned that this ... could negatively impact the city's favorable bond rating," Fry wrote. "The entities that evaluate bond ratings are well aware of the legal, moral, and reputational risks imposed by the issuance of bonds and take all those factors into consideration in their analysis of city finances."

Under tax increment financing deals, the city issues bonds to pay for property acquisitions, infrastructure improvements and other project costs, then uses the increased tax revenue generated by the development to pay off the bonds.

Some at the meeting took issue with a consultant's projections showing that the development would deliver a 10.7 percent rate of return for investors and make a profit of about $125 million without the city financing. With public financing, the rate of return would grow to 14 percent, allowing for millions more in profit, according to a city consultant's projections.

"This is certainly a doable project without it," Stokes said of the financing.

Beatty remained calm through the hearing, which frequently grew heated. Councilwoman Rochelle "Rikki" Spector criticized members of the public as a "peanut gallery" and was lectured by Stokes to be respectful.

Asked about her comments after, Spector quipped: "I like peanuts."

The Harbor Point development is the planned home of Exelon's new regional headquarters, a Morgan Stanley facility and other office buildings, residential towers, stores and a hotel.

The site is assessed at $10 million, but the Baltimore Development Corp. projects it would be valued at $1.8 billion for tax purposes when the developer completes it.

In addition to the tax increment financing, the development is benefiting from more than $100 million in tax breaks.

luke.broadwater@baltsun.com

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