NESRI Media Center

Baltimore Developers Face Human Rights Fight

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Publication Date: 
August 6, 2013

The human rights based development framework crafted by NESRI and our partner, the United Workers, is gaining traction as United Workers' Fair Development Campaign extends its reach into a Baltimore City Council battle over the second largest public subsidy in City history.  At stake is a $107 million city bond (called Tax Increment Financing [TIF]), which will provide the city cash in hand to create promenades, parks and infrastructure at Harbor Point, an old chromium plant, all for a planned 23-story headquarters to house the $33 billion Exelon Corporation. Private Developer Michael Beatty wants the public bond money and the infrastructure it will create to attract other investors in his skyscraper. United Workers joined its Fair Development Campaign partners at a public demonstration on July 17th, prior to a City Council hearing on the bond, to decry the subsidy and demand a new development paradigm in Baltimore.  

“I don’t understand how they [the city] can’t spend money on rec centers and fire stations, but they can spend money on big developers,” said United Workers Youth Leader, Alize LeGrand. “There’s a lot of kids here who are worried that when we get older we won’t have any money, we will have low-wage jobs and we won’t have the money to put into our communities, we won’t have rec centers and parks and all that…Why take our hope away when you say you are for the youth, and for the next generation?”

“I’m against the Harbor Point TIF because it’s a bad deal,” said United leader Shantress Wise in a speech at the protest.  “Failed Development has been going on for a long time—I had a low wage paying job that caused me to lose my home.” 

United Workers used human rights principles of universality, equity, transparency, participation, and accountability to critique the Harbor Point legislation—noting that it failed in every category. “It doesn’t benefit everyone; it ignores already neglected communities and workers, and it was crafted behind closed doors with developers and public officials whose promises are simply rhetoric,” said United Workers organizer Mike Fox.  LeGrand also highlighted the lack of transparency.  “It’s crazy that we can get a Pizza flier in the mail, but I can’t get a flier on how my money is being spent.” 

Opposition to the deal already has produced information that is usually kept within the vaults of the Baltimore Development Commission (BDC), a quasi-public entity that crafts public subsidies for developers in closed-door sessions by claiming state “open meeting” laws do not apply to meetings involving “business and trade” information.   In response to a city councilman’s request days before the hearing, the BDC revealed that Developer Beatty expected a 10% profit on his skyscraper, but couldn’t get needed other investors unless the profit rate was at least 14%.  The BDC recommended public TIF bond is designed to close that gap, and ensure that all investors get at least a 14% return on their investments. 

Meanwhile, the vast majority of people in Baltimore who have invested in home ownership, 401(k) plans, or even savings accounts have seen zero profit on their investments since 2008, and, in most cases, have lost money.   Neither the BDC or Mayor Stephanie Rawlings-Blake have proposed public subsidies to directly assist these people.   As with other public development subsidies, people in the City are expected to wait until Beatty skyscraper investment “trickles down” to jobs and commerce that allegedly will lift their boats as well. 

Testimony at the July 17th hearing revealed that when the TIF Bond subsidy is combined with existing property tax credits and adjustments in state educational aid based on foregone property tax revenue, the deal will cost Baltimore $550 million.   The city insists roughly 3,000 new jobs will be created by the project, though half will be construction related, and the remainder low-wage service jobs. 

The United Workers' Fair Development campaign does not oppose public subsidies per se, but demands that they be crafted in a  transparent way that gives all in Baltimore greater capacity to meet their basic needs, provides employment and benefits for neglected neighborhoods, and sets human rights based objectives that are legally binding.

Unfortunately, Baltimore has been down this path before—coughing up, with federal and state help, over $2 billion in public subsidies to create its Inner Harbor Tourist Zone, which has produced jobs without adequate earnings, health care, or dignity.   This was documented in a joint Unite Workers and NESRI report entitled “Hidden In Plain Sight, Workers at Baltimore’s Inner Harbor and the Struggle for Fair Development.”

"Hidden In Plain Sight" and United Worker’s Fair Development Campaign  has attracted support from UNITE HERE Local 7, a hospitality workers union, and the Campaign has been endorsed by AFSCME, IATSE, NAACP, Interfaith Worker Justice, the Presbytery of Baltimore, and several community organizations.   In April, the Campaign succeeded in achieving an agreement at the new Baltimore Casino that will ensure jobs with union protections, living wages, and health care. 

The Harbor Point TIF is now scheduled for a City Council “work session” on August 7, 2013.  United Workers again will raise its human rights principles to critique Baltimore’s current “Failed Development” plans, and envision a new set of Fair Development policies. 

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