So, just how much in public assistance is Harbor Point actually set to receive?
It's a question on a lot of Baltimoreans' minds. As figures fly around in council chambers, news conferences and protests, it's easy to lose track of the total price tag on the package of subsidies proposed for the $1 billion waterfront project.
The short answer: About $400 million.
Here's how that breaks down. The current proposal is for the city government to help Michael S. Beatty's Harbor Point Development Group LLC project — which will house Exelon’s new regional headquarters — through the following ways:
* The city plans to issue $107 million in tax-increment bonds for infrastructure at the site — including seven small parks, a promenade and a bridge.
* Those bonds will accumulate $174 million in interest for a total debt obligation of about $281 million, which the city plans to pay using tax revenue from the development. Should the developer fail to pay, city officials say they have the option of placing a tax lien against the property.
* The city has redrawn a key map to allow the project to benefit from $88 million in estimated tax credits through the state’s Enterprise Zone program, designed to help impoverished areas. The state plans to reimburse the city for about half these lost taxes.
* The developer also is counting on receiving $24 million in estimated tax credits from the state’s Brownfields program, designed to help contaminated areas.
* Additionally, the city has authorized about $50 million in federal and city funds to go to improvements to Central Avenue, the primary road into Harbor Point that will be extended with a new $10.5 million bridge. City officials note plans for the improvements have been in the works for years, and neighborhoods north of Harbor Point would also benefit from the improvements.
That all adds up to around $400 million in public assistance, even if one doesn't count the transportation funds. What’s more, the development won’t begin contributing new property taxes to city coffers until 2025 — that year the developers expect to be caught up enough on their bond payments to begin contributing to Baltimore’s general fund for police, schools and other services.
City officials argue that the development is well worth the public investment. The mostly vacant 27-acre site of the former Allied Signal chromium plant is assessed at $10 million and generates about $250,000 annually in city taxes. That will increase to an assessment of $1.8 billion and an average of $19.6 million in annual property taxes, city officials say.
When completed, the site will generate as much as $38 million in property taxes. That’s money that will pay for city services across Baltimore could benefit from, officials say.
The city also has counted on raking in increased fees from the approximately 9,000 employees who would use the 9-building site, which would include a Morgan Stanley facility, other office buildings, residential towers, stores and a hotel.
Those workers and employers would contribute an estimated $88,000 in speed camera tickets, $65,000 in red light tickets, $61,000 from the admissions and amusement tax on entertainment venues, $40,000 toward the bottle tax and $600 in minimum wage violation fines, among other anticipated fees, according to an analysis by the city’s consultant, Municap Inc.
But Ronald Kreitner, the longtime head of the nonprofit Westside Renaissance, has brought another cost not anticipated in city’s plans to the public’s attention: About $200 million in lost state aid for city schools over time. Because Harbor Point would not contribute to city property taxes for years, he said, and because the state allocates education dollars based on property values, children will lose out.
City officials say they are re-calculating their numbers to incorporate Kreitner’s analysis, but don’t expect to change course on the project, which they say will generate about 7,000 new construction jobs and 3,300 new permanent jobs.
“We will provide updated figures but they do not materially affect the numbers,” said Ryan O’Doherty, spokesman for Mayor Stephanie Rawlings-Blake. “It strains credulity to suggest that Baltimore shouldn't try to create jobs and grow revenue because of school funding formulas.”
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