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Citizens are starting to question Harbor Point TIF subsidies

Fells Point association will reconsider its support of Harbor Point in latest sign of growing opposition.

Above: Artist’s rendering of high-rise Harbor Point, with historic Fells Point located at the upper right.

First it was a faint murmur of unease. Now it’s become a clamor for answers.

The $107 million tax increment subsidy proposed for Harbor Point is stirring up a normally somolent citizenry, which has been socked with rising water bills and cutbacks in fire protection and youth rec centers.

The latest evidence comes from a special meeting called for this Tuesday by the Fell’s Point Residents Association to revisit its endorsement of the luxury waterfront development and proposed regional headquarters of Exelon Corp.

The group had previously voted “not to oppose” the conceptual plan for Harbor Point, “but that was before many specific issues that need significant further discussion came to light,” Arthur Perschetz, association president, told The Brew in an interview today.

Too Much Public Subsidy

“The biggest concern by residents is that the city is dedicating hundreds of millions of dollars for a project that is basically a private development,” Perschetz said.

“Yes, it will produce some jobs,” he continued, “but it isn’t going to start paying anything back to the city [in the form of property taxes] until 2025. That’s what people are feeling – there’s too much subsidy for a site that the city itself says is one of the best locations on the East Coast.”

The group has invited Marco Greenberg, vice president for developer Michael Beatty, and Ronald Kreitner, director of Westside Renaissance, to “explain their viewpoints and answer our questions,” according to Perschetz.

Kreitner, a former director of the Maryland Office of Planning, is associated with Baltimore Orioles owner Peter G. Angelos, who has signaled his opposition to the Harbor Point plan.

Greenberg has been a senior executive at both Struever Bros, Eccles & Rouse and John Paterakis’ H&S Properties Development, who jointly held a ground lease at Harbor Point before they were reportedly bought out by the Beatty group.

“Gold-Plated” Parks?

The use of $59.1 million to finance parks at the site – and an additional $21.6 million for a waterfront promenade – has stuck in the craw of association members, Perschetz said, especially when the city spends so little to improve existing public spaces and its major parks are in disrepair.

The group’s membership will take a fresh vote on Harbor Point on Tuesday – and a rejection could have a direct impact on the evolving political calculus of the project.

Considered a “shoo-in” when proposed two months ago by Mayor Stephanie Rawlings-Blake, the $107 million TIF subsidy has been vigorously questioned by Carl Stokes, chairman of the City Council’s Taxation, Finance and Economic Development Committee.

Record crowds attended two hearings before Stokes committee last month.

They included members of the Campaign for Fair Development, associated with the United Workers union, and residents from Perkins Homes, who accused the city of using their low-income demographics to secure a state “EZ” (Enterprise Zone) designation for Harbor Point that give the developer $88 million in tax breaks.

Earlier this week, a petition drive opposing the subsidies began circulating on the Internet.

Perkins Homes residents question tax subsidies to Harbor Point at a City Hall hearing last month. (Photo by Mark Reutter)

Perkins Homes residents question tax subsidies to Harbor Point at a July 10 City Hall hearing. (Photo by Mark Reutter)

Councilman James B. Kraft, whose 1st District includes Fells Point and Harbor Point, says his support of the TIF subsidy – on top of the “EZ” tax break – is based on neighborhood support of the project. He publicly promised last month to vote on the project’s financing package according to the wishes of the community.

That vote may come as early as August 12.

Mayor Rawlings-Blake and City Council President Bernard C. “Jack” Young want to get the financing bill out of Stokes committee this week (a working session of the committee is set for 5 p.m. Wednesday in the City Council chambers).


The Beatty group is under enormous pressure to secure the TIF package before the end of September, when his group is set to purchase the capped portion of the 27-acre site from Honeywell International, the present owner.

The Allied Chemical chrome works was closed in 1985 in part because of its extensive pollutant of the harbor. (Photo by John Horn)

The Allied Chemical works was closed in 1985 in part because of its extensive pollution of the Inner Harbor. (Photo by John Horn)

The Harbor Point site was used as a chromium-ore reduction factory for more than a century.

It was closed by Allied Chemical in 1985 after environmental regulators determined that 62 pounds of cancer-causing chromium waste were being dumped into the harbor every day.

The site underwent a decade-long remediation to contain the chemical wastes buried under the factory. Allied first constructed a stone embankment around the three sides of the site that bordered on the harbor.

A three-foot-wide soil-bentonite hydraulic barrier was then extended more than 70 feet deep between the land and water, and a plastic-and-clay cap laid on top of the ground to seal off the contaminants.

Without TIF funds to finance the “public” portion of the development – which will be elevated on fill above the cap –  the $1 billion project cannot move forward, according to Beatty.

Will Exelon Walk?

Exelon Corp. is the only announced tenant for the complex, projected to take 12 years to finish and create more than 3 million square feet of new office, retail and residential space.

There is growing worry in the developer’s camp that Exelon might back out of its commitment to the site if the City Council does not approve the TIF legislation in the very near future.

If that did happen, the company wouldn’t walk far.

Under a February 2012 agreement with the Maryland Public Service Commission that permitted its acquisition of Constellation Energy, Exelon pledged to build a new headquarters building in downtown Baltimore.

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