MD to move 620 workers from State Center as revamp planning resumes

Maryland continues to relocate employees from State Center to downtown Baltimore as officials looks to revamp a failed, decades-long project to rebuild the dilapidated, 1950’s-era complex in Midtown.

UPDATE: City of Baltimore recommends closure of three city courthouses, citing indications of Legionella

A group of state and city officials is expected to begin meeting in January, and they’ll eventually recommend new plans for the future of the site to Gov. Wes Moore and Mayor Brandon Scott. Information about the workgroup follows a recent $58.5 million settlement to resolve litigation tied to the project.

“A settlement will avoid more prolonged, costly litigation and risk on behalf of taxpayers, which would have continued for years,” Moore said in a statement following news of the settlement last month. “We now have the opportunity to begin to define a new vision for State Center in partnership with the community.”

The state Department of General Services, which manages state-owned facilities, recently received approval for $3 million in annual rent to move 620 employees working at State Center to a downtown office tower at 1 South St.

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The Board of Public Works, composed of the governor, comptroller and treasurer, approved the 15-year lease, currently worth roughly $46 million and set to begin in October 2025, during a meeting Wednesday.

There are about 4,300 state employees from a variety of agencies who work at State Center. The state has moved about 1,000 workers from the complex, including the recent move of the Office of the Comptroller, which opened its new downtown offices on St. Paul Street in January.

State officials hope to relocate all of the remaining employees in the next two years.

The State Center complex this week joined a growing list of government facilities in Baltimore where water system tests have found Legionella. The bacteria, which can be common in office buildings, can cause a rare and severe form of pneumonia.

The state began proactively testing the water in state office buildings — many of which are old and deteriorating — in mid October, beginning with State Center.

Despite the bacteria’s presence, there have been no reported cases of Legionnaires’ disease, the severe form of pneumonia that can result from Legionella exposure, according to the DGS.

The project to rebuild State Center began in 2005 under former Republican Gov. Robert Ehrlich. Officials envisioned an office, retail and residential development to replace a cluster of five state buildings and 1,300 parking spaces on about two dozen acres of property in Midtown.

Despite receiving state approval years later in 2009, the project never made it past its conceptual phase, in part because of prolonged legal challenges.

Attorney General Anthony Brown has said that evolving economic conditions, real estate markets and technology, new proposals from the developer, and changes to the state budget also combined to grind the project to a halt and led the Board of Public Works to cancel it in 2016.

Former Republican Gov. Larry Hogan announced in 2016 that the state would go to court to terminate its contract, and the State Center developer countersued.

The attorney general noted that recent rulings in the case significantly increased the state’s exposure, with the potential for having to pay out claims totaling more than $200 million, on top of the significant time and money already poured into the litigation.

A motion for summary judgment was granted in the state’s favor, in part, which Brown said would have significantly reduced the state’s exposure. But the judge who granted the ruling has retired, and the judge now presiding over the litigation has reconsidered and reversed “most, if not all” of that ruling, Brown said.

With the recent approval of the settlement, the group of officials that will begin meeting in January is expected to recommend their plans in the coming months.