Baltimore won a $100 million federal grant yesterday that is expected to spark a sweeping revitalization effort in some of the city's most troubled neighborhoods.
The federal empowerment zone grant -- $50 million now, another $50 million in October -- will trigger an additional $800 million in commitments from city, state and private sources to revive dilapidated areas of East, West and South Baltimore.
As one of six cities to win the grants, Baltimore will also be able to offer tax breaks to companies that hire zone residents or move to the empowerment zone. Such tax breaks, officials estimate, could reach $225 million over 10 years.
Spread over several years, the money will pay for a wide variety of health, job training and economic development programs.
"I'm really excited. This is really a big victory for our community," Mayor Kurt L. Schmoke said, shortly after receiving word of the award on his car phone about 3 p.m. from U.S. Secretary of Housing and Urban Development Henry G. Cisneros.
Together, the areas -- including Sandtown-Winchester and Pigtown in West Baltimore; the neighborhoods around the Johns Hopkins Medical Institutions in East Baltimore; and Fairfield in South Baltimore -- have 72,362 residents, 41 percent of whom live in poverty.
With 10 percent of the city's population, the areas account for 21 percent of the murders and 23 percent of drug arrests.
The money could make a significant difference to those living within the empowerment zone's 6.8 square miles, the mayor said. "It gives residents an opportunity to really fulfill a number of their dreams to improve the quality of their lives."
Members of Maryland's congressional delegation, who along with the mayor steadily lobbied the Clinton administration for the city's proposal, were equally ecstatic.
"This is probably the single most important influx of federal funds this city has ever gotten," Sen. Barbara S. Mikulski, a Baltimore Democrat, said yesterday. She joined Mr. Schmoke in announcing the award at a West Baltimore community center.
The award's significance to Baltimore is magnified by the incoming, Republican-dominated Congress and voters' perceived desire to cut taxes by curbing social programs.
"This may be the last sort of effort of this type that we see in a very long period of time," said U.S. Rep. Kweisi Mfume, a Baltimore Democrat.
Atlanta, Chicago, New York, Detroit and Philadelphia-Camden also received $100 million empowerment zone grants yesterday.
Five other cities will share $315 million in recently approved federal housing funds but will not be able to offer business tax credits. They are Los Angeles, which will get $125 million; Cleveland, which will get $90 million; and Boston, Houston and Kansas City, Kan.-Kansas City, Mo., which will get $25 million each.
In all, 78 cities competed for the awards.
Baltimore's grant marks the culmination of a process that began in March, when Mr. Schmoke told a meeting of neighborhood leaders at the Community College of Baltimore that the city would compete for the award. He appointed Michael V. Seipp, executive vice president of the Baltimore Development Corp., to head the city's effort.
All along, Baltimore officials felt the city's application was among the best. But they expressed concern publicly and privately that Baltimore could lose to cities in states that carried more political weight.
Members of Maryland's congressional delegation and other sources said the strength of the city's application and its record in using federal money to redevelop the Inner Harbor were key to its selection.
"Baltimore has been a leader among American cities in making in novative and effective use of federal resources," said Sen Paul S. Sarbanes, a Baltimore Democrat. "Its planned empowerment zone is no exception."
Baltimore will begin implementing its empowerment zone tomorrow, when Mr. Cisneros is scheduled to meet with the 80-member advisory board here.
The effort will be directed by a 15-member quasi-public Empowerment Zone Management Corp., scheduled to be installed by January 2. Within 30 days, the corporation is scheduled to hire an 11-person staff. Social services in the empowerment zone will be provided under contract with private groups and eight village centers, which will coordinate neighborhood activities.
Within the first several months, Baltimore is scheduled to start a number of empowerment zone initiatives. These include the opening of a One-Stop Capital Shop for business, and the kickoff for an Ecological-Industrial Park centered around a resource recovery program that will convert discarded tires into oil. The city will also set up computer terminals in neighborhood centers to link zone residents with databases on jobs, health and education.
Many of the programs cited in Baltimore's proposal -- such as Parents Against Drugs, which operates drug prevention programs in public housing developments -- are already under way.
A key component is job creation, with businesses qualifying for tax credits for each zone resident trained and hired.
Within two years, officials estimate, 557 jobs will be created at an average annual salary of $14,560. After 10 years, they say, there will be 8,885 new jobs for zone residents, at an annual salary of $17,056.
Here are some of the key programs that Baltimore will set up with its empowerment zone money -- which includes $100 million in federal grants and $800 million in commitments from city, state and private sources:
* Establish an ecological-industrial park in Fairfield, centered on a plant to convert solid waste to oil.
* Fund a One-Stop Capital Shop that will provide $20 million in revolving credit for businesses.
* Set up a Healthcare Industry Minority Business Development Partnership to supply medical institutions in the zone with health care products.
EDUCATION AND JOB TRAINING
* Designate a school in each zone neighborhood to offer affordable after school and weekend activities, including educational, recreational and artistic programs.
* Establish a training fund to provide workers with stipends of up to $400 a week for six weeks, allowing them to get on-the-job experience.
* Pay for nonprofit van pools to transport workers to jobs not accessible by public transportation.
HOUSING AND COMMUNITY DEVELOPMENT
* Establish a $15 million community development bank to pay for for housing rehabs, commercial revitalization and entrepreneurial growth in East Baltimore.
* Set up a $20 million mortgage pool to help zone residents buy or fix up homes, with the goal of raising from 30 percent to 50 percent the percentage of homeownership.
* Deploy "mobile police stations," similar to those used as command posts at special events, in high-crime and open-air drug markets.
* Provide low-cost mortgages as an incentive for police officers to live in the zone, and allow those who do to take home their squad cars.
HEALTH AND FAMILY DEVELOPMENT
* Develop neighborhood Family Resource Centers to help elementary and middle-school children improve their performance.
* Set up neighborhood Child Development Resource Centers to provide quality low-cost day care and preschool programs.