Baltimore city officials may not have taken the lead in planning the development of Port Covington, but they still have the ability to make sure the massive project – a virtual second Inner Harbor – moves ahead smoothly and helps meet the city’s needs.

The main reason the city still has some leverage:

Sagamore Development Company, Under Armour CEO Kevin Plank’s real estate arm and the force behind Port Covington, needs a variety of approvals, permits and other concessions in order to start construction.

What will Baltimore soon be giving Plank?

His project’s master plan has to be adopted. Industrially-zoned land will need to be rezoned for commercial and residential development.

Demolition permits will be needed for buildings that don’t fit in with the plan. And the project may need the city’s powers of eminent domain.

Perhaps most importantly, the developers have indicated that they will need tax increment financing (a “TIF,” as this type of subsidy is called) or other forms of financial assistance and tax breaks. They plan apartments, retail, hotels and more – in addition to a new Under Armour corporate headquarters. The TIF would be sought to help fund the roads, sewers, storm water management areas and other infrastructure needed to support the large development – up to 13 million square feet of improvements spread over 266 acres.

Given the project’s scope and the amount of environmental cleanup and other site work involved, early estimates have ranged anywhere from $300 million to $500 million in TIF assistance alone.

This is the opening for the city to seek agreements and concessions from the developer. It once again gives the city the upper hand, as when it was doling out Inner Harbor land to the developers who proposed the “best and highest” use.

Extortion? Or Equity?

What should Baltimore’s leadership seek in return?

Nothing, say some people, pointing to the eventual jobs and tax revenues that would flow from the virtual mini-city on the shores of the Middle Branch that Plank unveiled last week.

All they can get, say many others, who argue the project would mostly benefit upper-income newcomers and suburbanites and deepen existing inequities.

Would these considerations be a form of extortion? Or a way to achieve social justice?

Provide resources that would be wisely used? Or squandered by a government bureaucracy plagued by mismanagement and lack of auditing?

Even those who favor concessions in return for tax breaks wish there were another way.

“I’m of the overall opinion that Baltimore should lower taxes overall, make taxation more progressive, and finally stop handing out TIFs/PILOTs/tax breaks to corporate developers,” said Lawrence Brown, assistant professor at Morgan State University who has focused on justice and development issues.

“But if the City is going to hand out a TIF to Plank’s Sagamore Development Company, then it should certainly include provisions that would help the City realize a more immediate and equitable return on its taxpayer investments,” Brown said, in a comment emailed to The Brew.

There would be no such qualms or hesitation if former mayor William Donald Schaefer were around today, it’s safe to assume.

Our team would be happy to work with Sagamore, Schaefer would likely say. And then he might, for instance, make a strong suggestion to Plank, a well-known horse lover, that he go look at Pimlico Race Course and the impoverished area around it, and think of ways to make improvements.

Others, in effect, take a “just say no” stand on TIFs and such subsidies for high-end waterfront development, arguing the developers can live without them and a poor city can’t suffer the lost revenue.

“The City cries broke and wants to close fire companies, yet here we are — being asked, yet again, to help finance a development that will only benefit a small part of our city,” Carol Ott wrote on her Housing Policy Watch blog last year on this subject.

“The majority of Baltimore City residents, 58% to be exact, earn less than $50,000 a year,” she said. “You probably spend more than that every year on clothes and shoes.”

Needs Aplenty

In the immediate vicinity of the project, there are potential needs aplenty, some of them environmental.

Other U. S. cities are creating precincts called EcoDistricts, where all the buildings are constructed and operated in ways that protect the environment by integrating goals of sustainable development and working to reduce every project’s ecological footprint. Port Covington, along Baltimore’s gritty, post-industrial south shore, is a good potential candidate.

How about a “water wheel trash collector” for the Gwynns Falls, which empties into the Middle Branch, similar to the one in the Jones Falls? Sagamore has already started looking into that.

The company also has expressed an interest in lighting up the Hanover Street Bridge and lowering the road leading to  it. The possible replacement or repair of the 100-year-old structure is a subject that transportation planners will begin studying next month.

Taxpayers are already paying $1.8 million for just the study. Perhaps Plank could help with the cost of following its recommendations?

Waterwheels, bridge lights and enhancing this gateway route to flourishing south Baltimore neighborhoods is one approach, arguably a modest one. But what about helping the struggling communities on the other side of the Middle Branch, places like Cherry Hill or Westport?

Leaders of these communities are already in discussions with Plank’s team.

Beyond the Harbor

Should a TIF recipient have to agree to provide assistance more broadly in the city, outside of these surrounding communities?

That’s another debate Plank’s project has re-ignited. There is at least one candidate running for City Council, Ryan Dorsey, who has said he would not support tax breaks for Port Covington unless its developer helps fund projects elsewhere.

Dorsey’s campaign literature states that he “will not support tax breaks for Inner Harbor developments without similar investments in neighborhoods outside the Harbor.” Asked about it on Facebook, the 3rd District candidate said another commenter had overstated his position and mischaracterized him as wanting Plank to pay for bike lanes in his Northeast Baltimore district.

“I haven’t seen any evidence that TIFs benefit the city, and I generally oppose them in principle, but if Plank wants $400M or $500M … in subsidies (which is likely what this project would ask for) and he’s willing in return to put up that much money (“similar investments”) all over the rest of the city, which is highly unlikely, then cool,” Dorsey wrote.

Others have made the case without qualifiers, suggesting that developers like Plank be asked to help not just with particular neighborhoods but with pervasive systemic problems citywide.

Local Hiring and Housing Affordability

Brown, of Morgan State, argues that any TIF should include a number of provisions to ensure that the development benefits current residents and doesn’t further Baltimore’s hyper-segregation.

Among his ideas for negotiations around Port Covington is having over 50% of the construction workforce come from people who live in Baltimore City, along with hiring preferences and workforce development for those local residents to prepare them to fill subsequent job openings there.

Subjecting all housing construction there to the city’s inclusionary housing law is another condition he favors. (Since the law went into effect, only 32 homes have been built in four developments out of the 9,000 approved or completed units developed.)

To ensure racial as well as economic diversity, he said, the city also should, with TIF recipients, enforce the “affirmatively furthering” clause of the 1968 Fair Housing Act.

“While in this stage of putting together a master plan, the City should hold Sagamore accountable for fulfilling the requirement in order to help desegregate the city,” Brown said.

Others, meanwhile, are looking to Under Armour to come up with a more direct way to benefit current residents – by manufacturing some of its products in Baltimore. (Currently most of its products are made outside of the U.S., primarily in Asia.) It’s an idea the sportswear manufacturer has expressed an interest in, though it appears far from reaching fruition.

“UA would be an even bigger success if they manufactured their products here,” Ott wrote online. “Providing good middle-class jobs would go much further towards public favor than trying to take public land.”

Helping Each Other

At this point, it’s clear that Sagamore needs the city’s help to move its Port Covington project from vision to reality.

And the city has needs that Sagamore and Plank may be in a position to address, in return for assistance with Port Covington.

As Sagamore and Under Armour expand their presence in South Baltimore, the next step for the city should be identifying and agreeing on ways they can help each other.

————————————

Other recent Port Covington coverage in The Brew

• Plank pledges continuous public access to the waterfront at Port Covington (1/10/16)
• Biggest development since the Inner Harbor coming – to a city where developers now drive the planning (1/11/16)

Previous Brew reporting on Kevin Plank and the aquarium’s West Covington Park:

• Kevin Plank jumps to the head of the waterfront development crowd (6/13/14)
• National Aquarium’s pretty waterfront park, on a prime parcel, sits in limbo (8/11/15)
• Councilman Carl Stokes calls for public hearing on never-opened aquarium park (8/20/15)
• Aquarium’s CEO says city agency is responsible for opening Middle Branch park (8/21/15)
• West Covington Park may open soon, but park near Hopkins is still delayed (8/24/15)