The following statement was received by The Baltimore Post and is published as written. The Post will have an in-depth report tomorrow on the narrow 4-3 decision to fund Towson Row.
Like last night’s vote, that the council passed along partisan lines in two weeks, reveals on some serious flaws that we will examine in our in-depth report.
Stay tuned folks, this battle has just begun.
Now, for Mr. Kache’s response as written below.
Towson – Last night, I voted against the $43 million dollar tax payment for the proposed Towson Row Development. It was a decision I made after much thought and deliberation. Along with my constituents, I have been appalled by the County Administration’s policies of corporate welfare, particularly those in which companies with political connections in Baltimore County become the beneficiaries. Today, because of the lack of due diligence on the part of Caves Valley Partners, there is a giant hole in the center of Towson, and the Baltimore County taxpayers have now been given the unenviable task of helping to fill it.
This project, originally conceived by Caves Valley Partners, was stalled two years ago when the developers found bedrock when digging for an underground garage. Upon this discovery, all work on the property ceased until a new developer, Greenberg Gibbons agreed to take on the project, committing to invest $350 million dollars to resurrect Towson Row. Under the new contract, Caves Valley Partners continues to hold a 5% ownership of the project and would be in line to develop the proposed future office tower.
It is galling that the Administration is claiming that in order for this project to move forward, Baltimore County taxpayers need to pay $43 million dollars toward a project estimated to cost $350 million.
It is also very disturbing that the Administration can conjure up money for this transparent bailout of Caves Valley when communities around Baltimore County have been told time and time again that there is no money for much-needed projects, such as school replacements (Dulaney, Towson, and Lansdowne High Schools), road resurfacing, recreational parks and athletic fields, and senior citizen centers. This situation of finding money for the Administration’s own purposes over the immediate needs of the very communities that make this County a great place to live, work, and play, continues at an alarming rate.
While we have been told that the rosiest of assessments predict that the County will recoup the money it will spend in 7-8 years (the Sage policy report commissioned by the Administration predicts much longer) through increases in tax revenues, the badly needed projects and services that will not be addressed because of taxpayer funds going to this development project remain outstanding and unaddressed.
On the face of it, one might think that this was an easy decision. However, it is also true that the current site of Towson Row is an eye-sore which continues to be a detriment to Towson, our County Seat. Obviously, Caves Valley Partners, the developer of record, has mishandled the entire project, and as of late, this same developer has been the subject of extensive controversy.
By contrast, Greenberg Gibbons is a first class developer and business leader. They have shown this time and time again with their projects in Baltimore County and elsewhere. Greenberg Gibbons developed the highly successful Hunt Valley Town Center in the Third District, and is currently putting the finishing touches on the newly renovated Shops at Kenilworth just south of Lutherville-Timonium. For each project, they never asked for, nor did they receive special treatment from the County. With the sterling reputation that they have, it continues to be my hope that Greenberg Gibbons can use their clout to renegotiate the Towson Row Project without the $43 million dollar taxpayer infusion of funds.
As a County, we should not be in the business of bailing out developers who did not do their own due diligence when work originally commenced on this site. And yet, that is exactly what will happen for Caves Valley Partners. Despite their mismanagement of this project, the passage of the current contract with the County of $43 million dollars will result in Caves Valley having a 100% interest in the proposed office building in Towson Row and a 5% interest in the rest of the project. In addition, they will recoup most of their investment up to this point.
Furthermore, the speed and lack of transparency with which we, as members of the Council, were asked to consider this is also of major concern. It is no accident that the Council did not receive the Fiscal Note associated with this fiscal matter from the Administration (a regular and required practice for legislation involving requests for new spending that is customarily released on the Thursday prior) until the day before last Tuesday’s Work Session. And only at that Work Session did the Administration acknowledge that there was no independent risk assessment conducted regarding contingencies should the project be unsuccessful or if there is an economic downturn. This apparent lack of consideration should be extremely concerning to all County residents.
How can we, as a County, authorize this significant taxpayer sum of money without an independent analysis assessing the project’s likelihood of success or failure? While the County Administration commissioned an economic impact study, a risk assessment was not included in the final product.
In a time of tight budgets, we need to be careful in our funding priorities, even more so, considering this funding would be going toward correcting a mistake that was not of the County’s doing. Because of this, I oppose this taxpayer funded bailout.