Baltimore officials reach deal with Port Covington developer

City officials say they have reached an extensive community benefits agreement with the developer of the massive Port Covington project, doubling the amount of housing for lower-income people that was originally proposed, and requiring that more local workers be hired.

Councilman Carl Stokes said Wednesday that the agreement clears the way for the City Council committee he leads to sign off on a public financing package for the development as early as Thursday.


The deal would allow Under Armour CEO Kevin Plank's Sagamore Development Co. to use $660 million in taxpayer-backed bonds to pay for roads, parks, utilities and other infrastructure.

"We have something here that is very strong, and a relationship that bodes well for the project to stay on track for the next two or three decades," Stokes said. "There is a fair amount of excitement around it."


Stokes chairs the council's Taxation, Finance and Economic Development Committee, which is vetting the deal. He told The Baltimore Sun on Wednesday that Sagamore has agreed to make 20 percent of the housing in the massive South Baltimore development affordable for lower-income families, up from a previous goal of 10 percent.

The community benefits agreement, billed as the largest in Baltimore's history, is to be announced Thursday in Port Covington.

Stokes' committee is set to meet later Thursday to vote on the legislation to allow public financing. If the panel approves it, the full City Council could take its first vote on it Monday.

The benefits agreement would be subject to the approval of the city's spending panel, which is controlled by Mayor Stephanie Rawlings-Blake. It requires the signatures of the mayor, Sagamore and the City Council.

Sagamore declined to comment on the terms of the agreement, pending Thursday's announcement. Rawlings-Blake also did not comment.

Stokes said the agreement ensures that a quarter of the money involved in the tax-increment-financing deal will come back to the community in direct benefits. He praised Sagamore and Plank for negotiating in good faith.

The sprawling $5.5 billion redevelopment project could include offices, stores, light manufacturing and 7,500 homes, most of them rentals, on the largely industrial peninsula south of Interstate 95. The campus would also be the new home for Under Armour.

Stokes said the agreement requires Sagamore to employ a significant number of city residents.


More than half of people hired for the construction, design and engineering work on the site would have to come from Baltimore, Stokes said. He said Sagamore pledges to advocate for all businesses eventually operating at Port Covington to hire about a third of their workers from the city.

The agreement emphasizes hiring minority- and women-owned businesses, officials said.

Sagamore has agreed to provide $25 million for a workforce development center, training and low-interest and no-interest business loans, Stokes said. To strengthen the city workforce, officials said, at least 12 percent of all labor hours on the project will be given to construction apprentices.

Officials have agreed to pay trade workers on the project's infrastructure construction a minimum of more than $23 per hour, including wages and benefits, officials said.

Whether Stokes' committee votes to sign off on the financing deal depends partly on how soon city lawyers agree to the technical language, he said.

Clergy from Baltimoreans United in Leadership Development were a party to intense negotiations that stretched over the last 10 days.


The Rev. Andrew Foster Connors, who co-chairs BUILD, said the agreement will "play a key role in bridging" some of the inequities in the city by providing opportunities to more residents through training, hiring and affordable housing.

"We believe it's a historic deal that is going to change the paradigm for how development happens in Baltimore," said Foster Connors of Brown Memorial Park Avenue Presbyterian Church. "This deal truly moves from what were promises and goals to mandates that have real teeth."

Charly Carter, executive director of Maryland Working Families, said the deal appears better than the city's initial agreement with the developer but does not go far enough.

Carter co-chairs People Organized for Responsible Transformation, Tax Subsidies and TIFs. The group wants Sagamore to commit to making affordable housing accessible to minimum-wage workers and provide guarantees for non-construction and private construction jobs.

Carter said the City Council should hold off on voting until some issues, such as how to handle the potential impact on funding for public education, are resolved.

State aid to local school districts goes down as local tax revenues rise, as they are expected to do as Port Covington is developed. But the increase from Port Covington won't initially go to the city — it will be used to repay the $660 million in city-backed bonds.


Carter was part of the group involved in weeks of negotiations that she said culminated last week when Sagamore presented a final offer and asked activist groups to endorse it.

"We just felt like we could not in good conscience go back to our constituencies and say this was the best we could do for them," she said. She said she had not seen the deal to be announced Thursday.

Stokes said officials continue to push Sagamore for an agreement to share any profits from the sale of land once new infrastructure, such as roads and water lines, is built.

Officials also want the company to offset any loss in state education aid.

It is unclear whether those issues will be resolved before the committee's potential vote on Thursday.

Stokes said the community benefits agreement is better than any the city has had in the past. The councilman has been a critic of public subsidies for large developments; he launched a vocal fight against tax breaks for the waterfront Harbor Point project, and opposed $107 million in bonds for that development's infrastructure. He said it did little to benefit Baltimore neighborhoods.


On Wednesday, he praised the Sagamore agreement: "What we have agreed to so far is going to be pretty good."

Plank urged support for the project in an open letter published as a full-page advertisement in Wednesday's editions of The Baltimore Sun. Plank said the developer would commit more than $100 million to fund recreation centers, higher wages, job training, schools and parks in Baltimore.

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"We are at a decision point," Plank wrote. "We want to invest in Baltimore, hire in Baltimore, live in Baltimore, and give in Baltimore. I hope that you agree that we have a special opportunity here. I hope that the City Council will review and approve the TIF, to make this all possible for our city."

Also Wednesday, Plank's charitable organization, the Cupid Foundation, presented a $1 million donation to help the Archdiocese of Baltimore fund scholarships for 100 city students to attend Catholic schools.

City Councilman Eric Costello, who was present for much of the community benefit agreement negotiations, declined to comment on the specifics of the agreement. But he said he is optimistic that the Port Covington project will advance.

"I'm very excited about the project," he said. "I'm just hopeful that it can move forward after what's been very extensive negotiations with a pretty wide variety of stakeholders."


Baltimore Sun reporter Natalie Sherman contributed to this article.