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To TIF or not to TIF, that is the question for builders

May 19, 2016  •  source

Here’s a tale of two infrastructures.

One involves a project in South Baltimore and the other in White Marsh. City versus Baltimore County. Both described as “game changers” in the region.

One is Port Covington, the mini-city in the works by Sagamore Development, owned by Under Armour CEO Kevin Plank, and the other is Greenleigh at Crossroads, a new town developed by St. John Properties that broke ground this week in the northeastern part of the county, off Route 43 and near Interstate 95.

Both are massive, encompass 200 or so acres, and have the potential to offer 10,000 or more new jobs with new retail and office space when built out.

Both are start-from-scratch projects, as far as needed infrastructure like water and sewer lines, sidewalks, roads, and cable wiring are concerned. Both will sit on about 200 acres of mostly undeveloped, fallow land. Both will hold six figures of square feet of office and retail space, thousands of residential units, and a hotel at each site.

Yet while a record-breaking $535-million tax increment financing request by Sagamore Development for Port Covington project is now winding its way through the legislative process at City Hall, Greenleigh has embarked upon a different path about a dozen miles away in Baltimore County.

“We didn’t ask for [a TIF]. We didn’t need one,” said Ed St. John, chairman of the Greenleigh at Crossroads development company based in Woodlawn, adding that the installation of Route 43 by the county and state about a decade ago helped to spur the future development there.

“Some projects need [a TIF], and some don’t. What we have done here is slowly develop, and we will continue to slowly develop, so we don’t need a TIF to get us going.”

That will mean an infusion of $10 million in new income to Baltimore County each year from the project in the coming years, St. John said on May 17. In the city, though, there’s a longer wait for payday. That’s because Greenleigh will add $1 billion in taxable real estate to the county.

Sagamore Development’s figures show that the Port Covington project will begin to flood the city’s general fund each year with millions in new tax revenue around 2058, when all of the TIF bonds are paid off to the private investors.

The developer is lobbying hot and heavy for the $535 million TIF from the city right now. It whizzed through the Baltimore Development Corp.’s board on its way to the city Board of Finance in the early approval stages. Bills outlining its establishment were introduced before the council on Monday. At this time, as the debate is just beginning to stir over the Port Covington TIF request and the public’s input at hearings, you can’t help but compare the development approaches.

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