The developers of a Remington shopping center, which is slated to include a Walmart and Lowe's home improvement store, could be eligible for substantial tax breaks because of a resolution hastily approved by the Baltimore City Council last year.
The 25th Street Station project, planned for the site Anderson Automotive has occupied for half a century, is located in one of the city's two designated "focus areas," where businesses receive extensive property tax breaks and credits for hiring employees to stimulate growth in struggling communities.
Bmore Local, a watchdog group on the project, released a video Monday about the tax breaks titled "25th Street Station: Provider or Pillager" as the developer and community members prepare for a council committee hearing on the development Wednesday.
"There are so many tax breaks that Baltimore City is not going to see any increase in revenue on the property taxes," said Bmore Local vice president Genny Dill. "However, Baltimore City is going to have an increase in costs for traffic and roadways and infrastructure."
At a zoning commission hearing last month, developer Rick Walker of WV Urban Development repeatedly said that the project would receive no public funds.
Bmore Local members also raised concerns about the timing of the City Council resolution, which was introduced and expedited for final passage in October 2009, shortly before plans for the project were unveiled publicly.
"Baltimore City, two weeks or three weeks before this project was introduced, created this special tax zone that conveniently fit this project within it," Dill said. "We find that to be suspicious."
The resolution, which was introduced at the request of the Baltimore Development Corp., the city's quasi-public economic development arm, also established four enterprise zones, where lesser tax breaks are intended to stimulate economic growth, and renewed the Carroll-Camden Industrial Area — the site of a proposed slots parlor — as a "focus area," which makes it eligible for more extensive tax incentives.
Leon Pinkett, a senior economic development officer with the Baltimore Development Corporation, said the focus area designation was intended to spur new projects in a large swath of West Baltimore, not solely to boost the Remington project.
"The focus area is 444 acres, and the 25th Street Station project is just 11 acres of that," Pinkett said. "This had more to do with that section of West Baltimore and not that one particular project."
The boundaries of the area extend from 28th Street to North Avenue and Interstate 83 to Charles Street, he said.
The resolution was expedited through the council because Carroll-Camden's designation was set to expire soon, Pinkett said.
Businesses within the focus area receive a $1,000 tax credit each for up to nine new employees who make at least 150 percent of minimum wage and meet other criteria, according to state and city officials. They also receive an 80 percent credit on improvements made to the property for up to 10 years, Pinkett said.
In the video, Bmore Local members contend that only three focus areas exist in the state, but Mark A. Vulcan, the program manager for tax incentives at the state's Department of Business and Economic Development, contested that assertion.
There are several focus areas in Prince George's County, as well as the two in Baltimore, Vulcan said. Others in Lexington Park and Takoma Park have expired, he said.
To qualify as a focus area, a neighborhood must have higher-than-average poverty and crime rates, Vulcan said. Businesses that locate to focus areas receive larger tax credits than those in less-distressed enterprise zones.
The state reimburses the city for half of the lost revenue under the tax credit until the zone expires, Vulcan said.
Jon Laria, a lawyer for WV Urban Developments, the proposed developer for the project, said the development would bring about 400 temporary construction jobs to the city and about 700 permanent jobs.
"It's the largest job-creating project in recent memory in the city of Baltimore," Laria said.