Baltimore panel OKs $148M in bonds
Civic groups protest funds for Port Covington project
Baltimore’s spending panel on Wednesday voted to approve issuing $148 million in bonds to support the sprawling Port Covington project in South Baltimore.
The Board of Estimates voted 4-1 to authorize the bond issue, the first phase of a $660 million public financing package for Port Covington, the former industrial area owned by Under Armour founder Kevin Plank.
The bonds were expected to be issued in the first quarter of this year, after a city finance panel approved them in December. However, work on the project was suspended when the new coronavirus struck Maryland.
A group of civic organizations filed a protest ahead of the vote, citing the pandemic as one reason the spending panel should delay or withdraw the plan. Barbara Samuels of the ACLU of Maryland said the city’s economic outlook is far different from when the City Council passed the bond deal in 2016.
She said the city has “nothing to lose and everything to gain” by waiting to move forward until after it has conducted an updated analysis that takes into account the massive financial disruptions caused by the coronavirus.
Instead, the board approved spending city bond money on public infrastructure surrounding construction of an initial phase of redevelopment. It includes three apartment buildings, two office buildings and 1,000 parking spaces. The area is home to Under Armour offices, a restaurant and whiskey distillery owned by Plank’s Sagamore Development, and a building housing The Baltimore Sun’s offices and printing presses. The Sun rents the
facility under a long-term lease.
Democratic Mayor Bernard C. “Jack” Young voted in favor of the deal, but did not comment on it directly during the meeting. His two appointees who sit on the spending panel followed suit, as did Democratic Comptroller Joan Pratt.
City Council President Brandon Scott cast the opposing vote Wednesday. Scott, the Democratic nominee for mayor, said he doesn’t feel there has been enough transparency surrounding the deal. He said he learned only late last week that it would be voted on Wednesday.
“That’s not how the process should look for a project of this magnitude,” he said.
It could be years before the next round of bonds. In overwhelmingly Democratic Baltimore, Scott is expected to be elected to a four-year term in November.
Michael Middleton of the Cherry Hill Development Corp. rebuked those protesting the deal for not considering what residents in surrounding neighborhoods think. He said the people in South Baltimore have been working with the developers to figure out ways to collaborate and improve their communities.
“I don’t know for whom they speak,” he said of the organizations that filed the protest.
Developer Marc Weller said he’s excited about the “continued momentum” of the project with the Board of Estimates’ approval, and was heartened by Middleton’s testimony.
“We look forward to continuing our work and partnership with our neighboring communities in South Baltimore, as well as with the current and future city administrations and elected officials,” he said in a statement.
Weller Development is master developer for the Port Covington project for its owners, Sagamore Development, the real estate firm owned by Plank, and New York investment bank Goldman Sachs’ Urban Investment Group. The owners formed a joint venture called Baltimore Urban Revitalization LLC.
Samuels and the other groups protesting the vote questioned whether there will be the same demand for retail and office space moving forward from the pandemic. Colin Tarbert, president of the Baltimore Development Corp., told city officials Wednesday that he and others continue to monitor the impact coronavirus may have on the project.
“But I can say that this is a long-term project and the vision for the long-term future hasn’t changed,” he said.
The objecting groups — which included the ACLU, Step Up to Lead, the Maryland Consumer Rights Coalition, the Public Justice Center and Jews United for Justice — also expressed concern that in light of financial declines at Under Armour, the public deserved more information about what the deal could mean for taxpayers.
Since the City Council passed the financing agreement, Plank stepped down as CEO of Under Armour, and the sportswear company has laid off employees amid slowing sales. It also suspended plans to move its headquarters from Locust Point to Port Covington. Tarbert said the project isn’t contingent on Under Armour’s headquarters location.
“Companies are going to be excited to move to Port Covington and Baltimore City, regardless of whether Under Amour’s full campus is built out,” he said.
Three cybersecurity firms in 2018 committed to moving to Port Covington as part of the first phase of redevelopment.
The organizations protesting the agreement questioned whether more companies would move in, amid so much economic uncertainty, to fill up the massive space. Tarbert said he expects more companies to commit once they see the city moving forward on the deal.
According to an economic analysis of the bonds that was produced in December, Columbia-based public finance consulting firm MuniCap estimated the initial phase of the project would support 3,000 temporary construction jobs and about 2,800 permanent jobs, providing a net $1.6 million increase to annual city tax revenue.
The bond sale is to be conducted by the Maryland Economic Development Corp., or Medco.