Donning a hard hat, sturdy shoes and a face mask, Jeanette M. Lewis toured the construction site at the former Somerset Court public housing complex Monday, imagining what the multi-story shell might look like once completed.
Lewis, 86, has lived in the aging Perkins Homes nearby for nearly six decades. Soon, a public-private partnership made up of the city and a team led by Beatty Development will raze the World War II-era Perkins housing to make way for a massive mixed-use project to redevelop a swath of East Baltimore from Perkins through the Somerset and Oldtown Mall sites to the Johns Hopkins medical campus.
“I’m just glad I have this chance,” Lewis said about relocating to the new apartment building at Somerset.
Plans for the $1 billion-plus Perkins Somerset Oldtown Transformation Project call for developing 2,172 residences with a mix of public housing as well as “affordable” and market rate apartments. There also would be a school, retail space, public parks and a grocery store. To pay for $76 million of infrastructure for the project, the Baltimore Department of Housing and Community Development has proposed a $105 million tax increment financing package that the Baltimore City Council’s finance committee will consider Thursday.
Often controversial because it ties up city revenue and can be seen as a subsidy, tax increment financing uses the increased property taxes generated by a project to pay off bonds issued to cover costs for public infrastructure such as roads, water and sewer lines, and parks.
Under the Perkins Somerset Oldtown plans, the new market rate and affordable units would help cover the cost of replacing the 629 public housing units lost by the demolition of Perkins as well as adding 23 more. The project won a $30 million federal housing grant contingent on replacing all of the Perkins units.
The planned 565 affordable units would be available to those who earn 30% to 80% of the area median income. The remaining 955 units will be rented at market rates.
City officials, wary of accusations of displacing residents, have touted that 56% of the new units qualify as either “deeply affordable” or “affordable,” and that most of the public housing units — 377 — will be placed at the Perkins site.
But critics maintain the project still results in a net loss of public housing when factoring in the 257 Somerset units that weren’t rebuilt after they were demolished a decade ago. Others charge that the city’s plans effectively exclude dozens of low-income families from living in Perkins, situated next to Harbor East, Little Italy and Fells Point.
It also comes as Baltimore faces an affordable housing crisis so acute that the public housing authority stopped accepting new applications last year, citing a wait list of more than 14,000 applications and an average wait time of more than five years.
The Perkins Homes Tenant Council said it supported the redevelopment plan in a 2017 letter to Janet Abrahams, the president and CEO of the Housing Authority of Baltimore City. At the time, the project included 729 public housing units, but the housing authority ultimately landed on 652 units, citing financing limitations in their agreement with the U.S. Department of Housing and Urban Development.
“We’re bringing back more than what’s at Perkins,” Abrahams said in an interview with The Baltimore Sun. “I can’t speak to why [Somerset] was not part of the strategy back then, but we did extend invitations to people who lived there at the time and gave them the opportunity to come back. We made that a priority.”
Perkins tenants will have first priority in relocating to new public housing units developed on the Perkins, Somerset or Oldtown sites. Former Somerset tenants will have the next claim to the units, followed by those on the public housing wait list.
All units will be designed the same regardless of whether they’re public housing, affordable or market rate, officials said. Each will feature granite countertops, stainless steel appliances and washers and dryers. One, two and three-bedroom options will be available.
The choices being given public housing tenants reflect a major benefit of this project, Abrahams said. They can accept temporary or permanent housing vouchers or work with a case worker provided by Urban Strategies Inc. — a contractor brought on by the housing authority as part of the federal grant — to try to purchase a home of their own.
So far, more than 79 families have expressed interest in relocating to Somerset, including 30 from Perkins. And three have closed on homes with the assistance of Urban Strategies, according to Abrahams, with a fourth closing scheduled for this week.
"We have all these services to work with families so they aren’t afraid,” Abrahams said. “I don’t believe that we have previously transformed neighborhoods with those aspects in place, and that’s what makes it unique.”
Jay Greene, the city housing department’s chief operations officer, said the project aims to elevate the neighborhoods from a “hole in the donut” surrounded by more affluent areas into one people of all socioeconomic backgrounds would want to call home. This approach justifies the tax increment financing, he said.
“We’d get a neighborhood that is more functional, and people would get a better chance at better living conditions and an overall quality of life,” he said.
Tax increment financing deals have become an increasingly popular means to jump start city development, though some have protested their use as tax giveaways. The city uses the increased taxes from the development to pay off the debt, instead of using that money to pay for other city services, such as schools or police.
The city’s update to this TIF raised eyebrows earlier this summer when, at a city finance panel meeting, some criticized the city’s decision to add more units outside of the "deeply affordable” category. Mayor Bernard C. “Jack” Young asked city officials to provide data elaborating on the need to add more units so the “ACLU doesn’t say we are moving Black people away from Harbor East,” according to a Baltimore Business Journal report.
Robert Stokes, a Democrat who represents East Baltimore, said the mayor’s comments at that meeting did not accurately reflect the changes made to the TIF.
“I would not be out there pushing it if I thought what he said was true,” said Stokes, adding that Perkins residents still seem mostly on board with the plan.
But Franca Muller Paz, a Green Party candidate challenging Stokes in the 12th District, said there might be some truth to the mayor’s comments.
“Everyone in Baltimore wants to see new businesses and thriving communities, but they don’t want those decisions to be made at the expense of the folks who live and have families there,” Muller Paz said. “There’s going to be new retail there, but are we going to be able to afford those spaces? Are there going to be Black and minority-owned shops, or national chains? These should all be conversations that happen with community members so that it quells fears.”
Gregory Countess, an attorney with Maryland Legal Aid who represents the Perkins tenant council, said the competing priorities of the Perkins Somerset Oldtown plan represent “a mixed bag.” But Urban Strategies' care of residents, contractually guaranteed until 2024, and residents' ability to choose their next steps, offset some of his concerns, he said.
“You have, perhaps, a more integrated community, but then you have a development that has a reduced number of public housing replacement units at the site where those units were,” Countess said.
He said he also worries about the long-term affordability of those “affordable” units.
The housing department’s Greene said despite its possible shortcomings, the project serves as an example of what community-driven partnerships can produce.
“Is everything perfect? Probably not,” he said. “But, I think we have a pretty good plan, and hopefully it works exactly the way it was planned out.”