Port Covington is a neighborhood in Baltimore, Maryland that is destined for some major changes. Sagamore Development, a real estate firm owned by Under Armour CEO Kevin Plank, has proposed a massive developmental project for the area that will serve as headquarters for his company. The proposed Under Armour campus would be a center for employees of the company to live and work. It includes shops, offices, restaurants, residential units, and a distillery. Sagamore presents this project as a way to revitalize Port Covington and encourage further investment in Baltimore.
To make this vision a reality, Sagamore is asking the city of Baltimore for a TIF of $535 million. TIF refers to tax increment financing, which is a way to subsidize redevelopment projects for the community through public funding. A TIF basically serves as a subsidy for the company that wishes to develop an area that will then be repaid in property taxes when the project is up and running. The TIF that Sagamore is asking for will be paid in municipal bonds which would be paid out over several decades. Sagamore would then receive a market rate of return at about ten to twenty percent.
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Port Covington is located in a designated Enterprise Zone, which is an area, usually depressed or impoverished, that offers significant tax breaks to businesses that invest and build there.
The development of Port Covington has been highly debated. Community groups and unions have cited several concerns about the impact of the project. The affect it would have on public schools is uncertain. One of the main concerns is that the tax money contained in the TIF would justify cuts in spending for public schools. Critics of the project have also questioned whether the money could be better used elsewhere in ways that benefit the community more directly, such as affordable housing.
As is, the project will include affordable housing units, however the city has agreed to reduce the required percentage of affordable housing that Sagamore must provide in its development from twenty percent to ten percent. The planned housing development is estimated to house about 12,000 people, most of them new residents in the city. As for the jobs that Sagamore claims will be created, the vast majority of them will be office jobs, along with some retail and only a few manufacturing jobs.
The development of Port Covington will continue to be a hotly debated topic as the project gets underway. The 266-acre area set for development is going to be going though significant changes, including the relocation of the Baltimore Sun which has its headquarters in the area. Whatever the effects, the city of Baltimore is going to be feeling the impact one way or another.
