Baltimore’s Board of Estimates is poised to lift requirements that the owner of the Legg Mason offices and parking garage share profits with the city, in lieu of making full property tax payments.
The change, scheduled for Wednesday’s meeting, comes amid plans by H&S Properties Development Corp. to sell a stake in the 24-story blue glass building in Harbor East.
Baltimore’s Board of Estimates approved a tax deal in 2009 known as a payment in lieu of taxes, or PILOT, for the office and parking garage inside the Legg Mason tower.
The agreement limited tax increases to 5 percent of the property appreciation, applying to the offices for 15 years and to the parking garage for 25, said Kimberly Clark, executive vice president at the Baltimore Development Corp.
It also required the firm to share 25 percent of its profits with the city, after making a 15 percent return.
The agreement that will go before the Board of Estimates allows the developer to make a lump-sum payment of $1.5 million to remove that obligation. That’s more than the city expects to receive under the current deal, according to the agenda.
H&S did not respond to a request for comment immediately.
In 2009, the city said it approved the PILOT to retain Legg Mason’s headquarters in Baltimore. Clark said the city was also aware that its request that the garage go underground had increased the cost of the project.
To date, the developer has not reached returns that would trigger profit-sharing, according to the agenda. The proposed change would also free the developer to sell stakes in the building.
nsherman@baltsun.com
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