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Watchdog: Redwood campaign contributions ‘raise flags’

The new owners of Sparrows Point have made contributions to the Democratic gubernatorial ticket that a government watchdog group says raises concern.

Redwood Capital Investments LLC, the leader of a local investment group that purchased 3,100 acres of the site, and four subsidiaries including Sparrows Point Development LLC, donated $4,000, the individual limit in a four-year election cycle, to the campaign accounts of Lt. Gov. Anthony Brown, who is running for governor, his running mate Howard County Executive Ken Ulman and a single donation to the campaign committee of Baltimore County Executive Kevin Kamenetz, according to a disclosure form filed with the state.

The campaign contributions total $36,000 and do not violate state campaign finance law. But critics argue the contributions, which were all made on the same day in May, present an unflattering appearance. Sparrows Point Terminal LLC officially purchased the property in September, after negotiations to purchase the property were disclosed in letters from lawyers sent to a judge in July asking for an extension of a temporary restraining order that allows wastewater treatment to pass through two pipelines on the property.

Redwood Capital Investments LLC declined to comment on this story. Brown’s campaign manager did not respond to a request for comment.

“It definitely raises flags. You have to look at how the average citizen looks at it, that the money translates into a very public policy stance, and that’s our fear with these big donations in the system. We’re always hearing ‘they don’t buy votes’ but they certainly build these relationships that can be leveraged into policy reforms,” said Jennifer Bevan-Dangle, executive director of Common Cause Maryland.

Bevan-Dangle said relationships where developers make large campaign donations to candidates are “too common” in Maryland. She argued the state needs to close a loophole in its campaign finance laws that allows limited liability corporations, even if they’re run by the same controlling interest, to contribute the legal maximum for each entity.

“We finally were able, in 2013, to pass a bill that says LLCs would count … common ownership or control would be treated as one entity. But proving common ownership is still going to be incredibly difficult because most of their records are sealed,” she said

Although the sale of the Sparrows Point land was between private entities, the state maintains an interest because of environmental concerns as well as a desire to purchase some of the property to help expand operations at the Port of Baltimore.

Before the sale was closed, the developer negotiated an agreement with the Maryland Department of Environment to provide $48 million in financial assurances for the cleanup of the former steel making site. The cleanup is estimated to cost about $51 million. The Maryland Port Administration also remains interested in purchasing a portion of the property called Coke Point to build a containment facility for dredge spoil and possibly a port facility.

On Thursday, representatives from Sparrows Point Terminal LLC along with Brown, Kamenetz and Rep. Dutch Ruppersberger held an event touting the economic benefits of redeveloping the site as an advanced manufacturing hub. The event, which coincided with the first day of early voting, was held at the site in Baltimore County, a jurisdiction that played a crucial role in electing Gov. Martin O’Malley in 2006 and 2010 and in 2002 former Gov. Robert L. Ehrlich Jr., the first Republican in 36 years to be elected governor.


About Adam Bednar

Adam Bednar covers real estate and development for The Daily Record.