Subsidizing the Low Road: Economic ... - Good Jobs First

With a projected 611 office jobs, the $15 million PILOT subsidy would come to nearly$25,000 per job.CenterpointIn June 1999, the BDC asked developers to submit proposals to transform asquare block on the West Side into a mixed-use development. The site, locateddirectly across the street from the Hippodrome Theatre, would be at the epicenter ofthe city's West Side initiative. In December 1999, the BDC awarded exclusivenegotiating privileges to Centerpoint Development, LLC, a joint venture between Bankof America and the Harold A. Dawson Company. The developers proposed to build 370housing units, 58,000 square feet of retail space, and 450 parking spaces. The projectconsisted of a mix of new construction and renovation of existing buildings on the site.To make room for all of this development, the city began buying up the propertyon the block and relocating more than 20 small businesses. By October 2001, the cityhad spent $12.1 million to acquire the properties and $1.6 million in relocationcosts. 166 On October 3, the city agreed to sell the land to the Centerpoint developersfor only $4.9 million. The next day, the City Council authorized a PILOT agreement forthe developer. The BDC estimated that the city would forego $11.4 million during the20-year duration of the PILOT. 167 In addition to these subsidies, the project will alsoreceive $3.8 million in state and federal historic tax credits, a $1.5 million loan fromthe state, and a $1 million city grant for infrastructure improvements. 168 The landsubsidy, PILOT, tax credits, and grant total $25 million.The BDC estimates that the project will attract 354 new residents into Baltimoreand create 190 full-time permanent jobs, so that the average subsidy per job orresident would be almost $46,000. Seventy per cent of those jobs are projected to goto city residents. 169 The project will use first-source hiring to try to match cityresidents with the new jobs. 17037