From sinkholes to sewage spills, Baltimore public infrastructure has been taking it on the chin lately. But this week brought some mostly good news. The federal government has committed $125 million toward the renovation of the Howard Street Tunnel, a project that could generate as many as 7,800 jobs in the Baltimore region by making it possible to “double-stack” cargo containers headed to and from the Port of Baltimore. The bad news is that the Maryland Port Administration and CSX were counting on the feds to come up with $103 million more to help cover its nearly one-half share of a $466 million project. Suddenly, this crucial economic development project is within sight, but not yet within reach.
Average Baltimoreans may collectively shrug over this. After all, with the possible exception of that infamous derailment and fire 18 years ago, the historic rail tunnel underneath Howard Street is mostly out of sight and out of mind. But those involved in port-related commerce understand it’s actually this city’s worst traffic bottleneck, limiting the number of 58,000-pound containers that can be shipped by rail and forcing too many to be hauled across local streets and highways by truck. The opening several years ago of an expanded Panama Canal which made possible much larger cargo ships has only underscored that shortcoming. And what makes this especially frustrating is that initial costs to renovate the tunnel ranged from $1 billion to $2 billion. It was only after some clever engineers devised a more cost-effective approach several years ago involving both lowering the rail bed and raising the ceiling (and CSX came back on board after walking away from a funding agreement two years ago), that the feds even had this opportunity.
Gov. Larry Hogan welcomed the development and clearly expects the project to move forward. That makes us cautiously optimistic, the governor’s record for funding city-related infrastructure projects being what it is. Given Mr. Hogan’s failure to come through with state dollars for the $2.9 billion Red Line and his obstruction of the $1.5 billion State Center renovation that’s left that project in legal limbo, it would be nice to see him on the side of bringing game-changing public investment to Charm City for once. Third time’s the charm and all that. Particularly given how cost-effective the Howard project is. By any measure, this deserves to be at the very top of the Baltimore region’s economic development wish list.
Still, one has to wonder if the Transportation Trust Fund and Maryland taxpayers should be making up the entire difference here. Presumably, Governor Hogan will now be pressuring CSX to contribute more, and those talks are crucial. The notion that a private, for-profit company like Florida-based CSX with stock valuations up 16% on the year despite softness in trade (thanks, President Donald Trump and your fixation on foreign tariffs) would not have to kick in more than $91 million for a project from which it would so richly benefit yet has so far offered to finance just one-fifth the cost is ridiculous. What would be the correct ratio of additional state versus CSX dollars? We don’t know, but we’re certain it’s not 100 percent to zero. Even the Baltimore Ravens are willing to invest more in a downtown stadium that is technically owned not by them but the Maryland Stadium Authority. And you can bet the team’s recently-announced $120 million renovation plan won’t generate nearly as much revenue for ownership as the Howard Tunnel renovation will potentially generate for CSX.
That $103 million funding shortfall can’t be allowed to derail the renovation, not with so many good-paying jobs at stake. The Port is estimated to generate in the neighborhood of 40,000 jobs, directly and indirectly, which translates into more than $3 billion in personal income and nearly $400 million in state and local taxes. And these aren’t minimum wage jobs even at the entry level. A longshoreman can make as much as $70,000 a year. But CSX would be wise not to try to take advantage of Baltimore’s beleaguered financial circumstances, particularly given the influence of this state’s congressional delegation from House Majority Leader Steny Hoyer and down, not to mention the former Baltimore mayor’s daughter who happens to serve as House speaker. Both sides have their cards. Let the negotiations begin — and the renovations start before year’s end.