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Baltimore delegate seeks prevailing wage requirement for TIF projects

A Baltimore state delegate’s bill seeks to force developers receiving certain public financing for projects to pay laborers a jurisdiction’s prevailing wage.

Del. Cory McCray, D-District 45, introduced House Bill 466 that requires developers receiving a minimum of $500,000 in tax increment financing to pay the prevailing wage.

The legislation is needed because projects where private developers are receiving public financing, McCray said, sometimes pay below the prevailing wage. As a result these projects drive down the annual wage reported to the Department of Labor, Licensing and Registration, he said, which is used to set the prevailing wage in the state.

“One of the things that I’m very, very concerned about is that when we have a project at this size and scope … that the developer has the ability to manipulate the wage system because it’s so large,” McCray said.

The bill is scheduled for a hearing before the House Economic Matters Committee at 1 p.m., Tuesday, in Annapolis. McCray introduced the legislation along with other bills aimed at strengthening skilled labor apprenticeship requirements for projects receiving state funds.

The use of tax increment financing became a heated issue last year in Baltimore after developer Sagamore Development Co. was granted $660 million in tax increment financing for the redevelopment of Port Covington in south Baltimore.

Tax increment financing is used to fund public infrastructure work, such as sewers, streets and parks, associated with a development project. A jurisdiction issues bonds to pay for the work and that debt is then paid back with tax revenue increases associated with the development.

McCray denied his legislation is in response to the public financing granted Port Covington. But he said that when governments started providing tax increment financing they didn’t envision doling out more than a half-billion dollars in bonds.

He said its not unreasonable to ask projects receiving public funds to provide decent jobs for residents. The Parkway Theatre on North Avenue, which is being renovated and converted for use by the Maryland Film Festival, McCray said, is an example of a project receiving public benefits from the city, state and federal governments. Developers and groups backing similar projects, he said, should be required to pay a prevailing wage and hire apprentices working in registered programs as a condition for public financing.

McCray, who has been advocate for organized labor, said the bill falls in line with previous efforts to provide Baltimore residents with good-paying blue-collar jobs. He said the the legislation was not aimed at providing a boost to organized labor. The delegate previously touted his experience in an apprenticeship program with the International Brotherhood of Electrical Workers Local 24 as a playing a role in his success.

Good blue-collar jobs, McCray said, were once the backbone of communities such as Berea, Oliver and McElderry Park. Now, using this legislation, he wants to make sure Baltimore residents have access to jobs in the trades that provide a pathway to careers.

“Those communities weren’t built off of doctors, and dentists and scientists. They were working at the (Sparrows) Point, they were working at Domino Sugar, they were working at American Can Co.,” McCray said.

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