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State wetlands fee for dining piers drops 99% from last year

Three Inner Harbor restaurants will ask the Board of Public Works on Wednesday for permission to modify their dining piers, more than a year after those restaurants decided the state’s asking price for such approval was too high.

A dining deck such as this could have cost an Inner Harbor restaurant from about $400,000 to nearly $800,000 in Maryland wetlands fees.

Phillips Seafood, Hard Rock Cafe and Dick’s Last Resort withdrew their applications for a wetlands license last year when the Maryland Department of the Environment assessed a compensation amount of $175 per square foot, saddling the restaurants with six-figure bills to expand and improve the piers, which jut into the harbor in front of the establishments.

When the state panel — composed of Gov. Martin O’Malley, Comptroller Peter Franchot and Treasurer Nancy Kopp — takes up the issue on Wednesday, that fee will have fallen to $2.50 per square foot, a decrease of nearly 99 percent over the initial amount sought. Such a fee is sometimes charged to compensate the state for private use of its property — in this case, the harbor.

Jay Apperson, a spokesman for MDE, said the new rate was the product of negotiations between the restaurants and Board of Public Works staff over the last year and that MDE was not involved in determining the price.

“We make a recommendation on whether there should be compensation,” Apperson said. “We did recommend that they seek financial compensation.”

Doldon W. Moore Jr., the board’s wetlands administrator, was not available to comment on Tuesday.

Cordish Cos. Chairman David S. Cordish, the restaurants’ landlord, did not respond to a request for comment. None of the restaurants seeking a wetlands license responded to requests for comment.

The original fee was based on the higher of two separate property assessments, and the Department of General Services approved the appraisal as fair market value. The lower assessment was $110 per square foot.

The Board of Public Works never weighed in on the assessment, however, because the restaurants pulled back their applications. Franchot — who wanted to discuss the issue anyway — said last June the proposed assessment was “ridiculous” and “clearly not reasonable.”

Calling it a “nightmare law school problem,” O’Malley and the board asked the Office of the Maryland Attorney General what authority it had in determining the amount to charge the restaurants, including whether the panel was allowed to modify or eliminate the proposed fee. The attorney general opined that the board could alter or waive the fee if it chose, according to the Board of Public Works’ agenda.

The revised wetlands license, if approved, would lower the proposed Phillips’ bill from $779,275 to a one-time $20,000 fee plus annual payments of $2,000 and saddle Hard Rock with a one-time $20,000 bill, down from a proposed $378,000. Dick’s Last Resort would be required to pay $8,355 a year for its dining deck compared with the $584,850 proposed last year.

Joe Emanuele, Hard Rock’s vice president of design and development, told Baltimore officials in March 2012 that the restaurant wanted to add a retractable roof and grill to the 2,160-square-foot pier outside the cafe.

Steve Phillips, owner of the Phillips restaurant, told the same city officials that his restaurant wanted to build an outdoor crab deck that includes an open-air kitchen, a crab-picking station where customers could learn how to clean and eat a steamed crab, and a retractable awning, under which would be picnic tables and lighting.

The situation is somewhat different for Dick’s Last Resort, which was already issued a wetlands license but had not agreed with the state on a compensation amount.

In April 2011, the restaurant asked to begin construction on an outdoor dining area without first receiving a property assessment so it could open in time for the summer tourist season. The deck opened on time, but the restaurant was later surprised when the state sent it a nearly $600,000 bill.