How Governor Hogan is running (over) Baltimore

Baltimore has a charter giving the Mayor a lot of power. Some think that should be changed based on recent experiences. Before considering such things, the State's role in the City needs to be understood: Even the city's strong mayors can be pre-empted by the Maryland Governor. The Gov controls Baltimore's transit, the City's police is actually a State agency and an ever weaker Baltimore is ever more dependent on State support. Hogan has shown time and again, that when push comes to shove, Baltimore isn't top on his agenda, all professed love notwithstanding.

Much maligned: State Center offices. They are in bad shape, but they should
probably not be demolished but refurbished. (SUN photo)

Taking $3 billion out of Baltimore's economy by cancelling the largest ever single project for infrastructure , the Baltimore Red Line, is by now legendary and only matched by Trump's various aggressions against public transportation. But Hogan can needle the City and interfere in City business in many other ways:

• By pushing the Housing Department to do rushed rowhome demolitions if the want to see any of the State's Project Core money, 
• by suggesting that the City's State's Attorney Marilyn Mosby  should be augmented by staff under the State's Attorney General, clearly thumbing the nose at Mosby
• by picking the County candidate over the City's candidate for the Senate seat previously held by Senator Nathan Pulliam  
• by cutting money from the MTA, the City's largest transit provider
• by withholding Highway User Funds from which the City would be the largest beneficiary since City DOT maintains all State roads within the City
• by ridiculing a masterplan for the State Center area that had been worked out over a more than a decade

This last issue is especially hard to understand, even if one tries to put oneself into the Republican mindset since it involved optimizing existing State transit assets (versus building new lines) and private public-partnerships, both usually Republican talking points. State Center with its over 3,300 State employees represents a large State enclave inside Baltimore. Hogan's predecessor O'Malley wanted to use it to leverage the State's presence for economic development in the City. To this day, Hogan has never explained in detail, what he didn't like about the plan, except ridiculing it for the suggested lease back rents for the State offices. Under the plan developed under Governor O'Malley the State would have assisted in: 

• Turning a past urban renewal disaster of office mono-culture with huge parking lots into vibrant mixed use connecting tissue between neighborhoods and downtown. 
• Giving State workers  a modern state of the art work environment that the State would lease back from private developers
• Make best use of the State owned existing subway and light rail lines serving the area through increased density and uses
• Using the State's large presence to ensure developers and investors that the development will be used and be viable
  

  

  Rendering of the Hogan rejected State Center plan that was also
  Transit Oriented Development (Ekistics)

Hogan's plans are quite different: He is now progressing towards emptying out State Center and redistributing State workers all over downtown. He has no plausible plans for the redevelopment of the State Center land area and whatever had been floated as an alternative to the previously adopted masterplan is outright ridiculous, such as a relocation of the Arena here or a gas station. Nothing in the January 2018 report commissioned by Hogan has gained any traction in the community or the City administration. It also has no economic base, hard to comprehend from a Governor who has run a real estate business. As the SUN put it in a January 2018 op-ed:

What made the grander vision for State Center possible was a public-private partnership in which the state agreed to long-term leases of office space for its workers. That (along with some state and local tax breaks) made the project financially viable for the developer and also created a built-in market for higher quality retail and other amenities. The plan also had the benefit of having been shaped through years of community engagement by the developers and the state and enjoyed widespread support among the diverse neighborhoods that border the property. (SUN)

Hogan's plan to relocate the State workers downtown will remove that kind of support and won't have the positive effects. Disbursement of the workers is welcomed by downtown office tower owners who have trouble filling their properties. Led initially by Peter Angelos who sued the State early on (and lost) they have long fretted about State Center as a state of the art facility that could become competition to their domain. (Competition usually is also a cherished Republican value). But an empty State Center is dreaded by the communities surrounding the 28 acre area. What is already a hole in Baltimore's urban fabric will become an uninviting deserted and potentially dangerous vacuum, with no plans or investors in place for redevelopment. It is doubtful, that the Governor can solicit developers as long as he is still in a legal quagmire with the previous development team that he can entice them to even be interested in substantial mixed use redevelopment without the State incentives of the previous plan.

A hole in Baltimore's fabric: The failed State Center urban renewal

Instead of helping "his own" MTA to gain riders for its subway which currently runs with about half the ridership of its heydays, the State Center station will become deserted. Instead of helping the neighboring cultural district in which institutions such as the Baltimore Symphony are suffering from lack of funds and visitors, a vacated State Center will create a wasteland next to those institutions. Instead of providing economic development and a boost to the City, the State is just shopping around for the cheapest office space it can lease. Instead of creating a larger base, a vacated and potentially demolished State Center follows the zero-sum playbook in which the same offices just move around. In zero sum thinking, neither Harbor East nor Harbor Point would have ever been developed, no matter that it is delusional to think that all the downtown offices would be well filled now without those new competitors along the water. In fact, without the new areas Baltimore would be even weaker economically than it is already. Economists  don't believe in zero sum thinking since with it we would still use an abacus to calculate our bills.

The BBJ reported that the Department of General Services (DGS) will issue a request for proposals for office space as early as this first quarter of 2020. 

"We’re monitoring it to see what could happen. It is something all of us in the city who are either in real estate or any business in general in the city believe is a good thing, The CBD far and away has the highest amount of vacancy at 2.5 million square feet, or a 19.6% vacancy rate. The State Center agencies are sorely needed to help back fill this amount of space." (Courtenay Jenkins, ED of Cushman Wakefield Baltimore per the BBJ).

While downtown developers hope to fill their vacancies, the State office workers could well also find a home in the vacant offices of the former Social Security Administration on Greene Street on the western edge of downtown, now owned by Caves Valley. The facility that could likely accommodate all 3,300 workers. If that were to happen, whom would the legacy owners blame?

Gov. Hogan announces his latest strike against State Center:
An RFP to relocate State Center workers

Wherever the State employees will eventually land, with nixing the State Center redevelopment plan,  Hogan took another $1.5 billion or so out of Baltimore's economy at a time when new jobs and economic opportunity were sorely needed in this City.  It makes little sense for the Governor to complain about Baltimore's crime rate and at the same time consider State and private partnership investments either a "boondoggle" (Red Line) or in best Trumpian language a "disastrous, failed deal.” (State Center,  BBJ, Nov 26,2019).

A $130 million for MTA's Baltimore bus link system, $1 million bridge loan for Lexington Market and some $75 million for "Project CORE" are nice gestures, but they are no substitute for near $5 billion dollars taken away.

This all may not matter for Hogan's support in the State outside Baltimore (he has a 75% approval rating), but it should matter greatly to the Mayor of Baltimore. So far, protest against the Governor's tirades against the old State Center development team (he accused the team of "lining their pockets") have only received meek push-back from the three mayors in charge during the long period in which Hogan dismantled the project. With the mayoral race now in full swing, it is pertinent that the candidates clarify where they stand on State Center, on State-run transit and on prosecution by the State's Attorney General and how much they would allow a Maryland Governor to run this city from behind the curtain.

Klaus Philipsen, FAIA