After months of sometimes scathing criticism of the city's economic development agency by business leaders, Baltimore Mayor Kurt L. Schmoke announced yesterday that he is reassigning Honora M. Freeman, the agency's director.
The mayor also said that C. Edward Hitchcock, the top administrator of the organization overseeing Baltimore's $100 million federal revitalization program, probably would leave his post soon -- months after he was hired.
Mr. Schmoke denied that he had forced the resignation of Ms. Freeman, who has been president of Baltimore Development Corp. for 3 1/2 years. He described her move -- to become his deputy chief of staff, a newly created position -- as a "transfer."
But he added, "The bottom line is, it's clear that this was an opportunity for us just to get a fresh start."
The move takes effect July 1.
Reacting to her impending departure, some business leaders, economists and politicians said it gives the BDC a chance to bring in a more aggressive leader; others said the agency needs more than just a change at the top.
The BDC has been criticized sharply in recent months for shortcomings in attracting and retaining businesses in Baltimore, which has lost 20,000 jobs since 1991, the year the agency was created.
In December, The Sun published a lengthy article in which
several business leaders said Ms. Freeman, a lawyer with no background in economic development, should be replaced by someone who understood the needs of local companies. A month later, criticism of the agency was renewed after USF&G; Corp. announced it was leaving its downtown headquarters and was consolidating operations in Mount Washington.
Such criticism prompted the City Council to open hearings into the BDC last month. And three weeks ago, Mr. Schmoke created a panel to conduct a "top to bottom" review of the agency and to make recommendations within 60 days.
The mayor said he and Ms. Freeman were concerned that the reassignment might signal that "we agreed that BDC had failed in its mission."
He said they also were concerned that it might be interpreted as a health-related move. But Ms. Freeman says she has finally won her 18-month battle against colon cancer.
To help shore up the beleaguered agency, John Sundergill, director of economic development for Baltimore Gas and Electric Co., will be assigned to the BDC for six months beginning May 1. Robert L. Hannon, one of two BDC executive vice presidents, is leaving on that date to become Baltimore County's economic development director.
Mr. Schmoke promised to "look broadly" for a new BDC chief and said the search would intensify after the report of his review panel.
A. B. "Buzzy" Krongard, chief executive officer of Alex. Brown & Sons, who has privately expressed displeasure about his dealings with the BDC over his firm's search for a new downtown headquarters, had some pointed advice for Mr. Schmoke yesterday.
"Get the very best person you can without consideration of anything other than the person's ability to do the job," he said. Ms. Freeman came to her job from Shapiro & Olander, a firm whose members include Ronald Shapiro, the mayor's campaign treasurer, and Larry Gibson, his campaign chairman.
Councilman Martin O'Malley said it was clear that Ms. Freeman had to go.
"For whatever reason, the perception of people was that BDC was not effective and she was not up to the job," said the 3rd District Democrat, who was chairman of the council's recent hearings on the agency.
Others said the troubled agency -- set up as a quasi-public corporation with a $3 million annual budget -- needs reforms that go beyond a change in leadership.
"If it stops with Honora's stepping down, I can guarantee that nothing substantive will change," said Michael A. Conte, director of regional economic studies at the University of Baltimore. "I think BDC is very under-funded. I also think their mission needs to be clarified."
City Council President Mary Pat Clarke, who is challenging Mr. Schmoke's bid for a third term in September's Democratic primary, agreed that the BDC's problems go beyond Ms. Freeman.
"The failure is not Honora Freeman's; it's the mayor's and the direction he gives," Mrs. Clarke said.
Ms. Freeman makes $84,000 a year as head of the BDC. Her
salary as the mayor's deputy chief of staff has not been determined, the mayor's spokesman said.
Of Mr. Hitchcock, Mr. Schmoke said the lawyer talked to him several weeks ago about resigning as president of the organization overseeing Baltimore's empowerment zone. Mr. Hitchcock wants to return to his law practice, the mayor said.
The mayor said he asked Mr. Hitchcock, whom he appointed to the $120,000-a-year post in January, to remain in the position to complete some tasks essential to "getting the empowerment zone up and going," most of which are almost complete.
Mr. Hitchcock said he had originally agreed to stay in the job for up to two years, to oversee the empowerment zone's start-up. But he added, "It looks to me like we are way ahead of schedule."
He said he hoped to leave within 60 days but would stay on longer if necessary.
Mathias J. DeVito, chairman of the board of EMPOWER BALTIMORE!, said Mr. Hitchcock's impending departure would not hurt the high-profile effort to revitalize dilapidated areas of East, West and South Baltimore.
"I don't like it; it's an interruption," Mr. DeVito said. "But a lot of things are moving, a lot of things are in place."
On Wednesday, the board approved $34 million in programs for business development, housing, job training and public safety.
Diane Bell, a special assistant to Mr. Schmoke, is joining the staff
to oversee social service programs.