In 1997, as the crisis of urban sprawl was settling firmly in our national consciousness, the State of Maryland launched a modest effort to recast the policy framework in which development decisions are made. The Smart Growth and Neighborhood Conservation Initiative, which has been evolving ever since, immediately captured the attention and interest of policymakers nationwide.
What made our approach stand out was the decision to rely on fiscal policy and incentives, rather than land-use regulations, to direct growth. It was a response grounded in history. After decades of subsidizing sprawl - and consequently, the abandonment of older cities and towns - we had seen the power of the public purse in shaping growth.
Today we no longer support development in outlying areas. State funding for roads, water and sewer systems, and other growth-related needs goes instead to established communities and areas where the state and local jurisdictions have agreed to encourage development.
Outside these “Priority Funding Areas,” we have become much more aggressive and strategic about land preservation. Under our Rural Legacy Program, we have worked with counties to identify large contiguous tracts that are rich in the agricultural, historic, and natural resources that define our state, and we dedicated new funding to start taking that land off the real estate market. This new layer of land preservation has helped us to better prioritize state spending, as has GreenPrint, another program adopted last year to focus on our most ecologically important land.
At its core, smart growth is about fiscal responsibility and rewarding better land-use practices - both of which complement the goals of historic preservationists. For too long, we used taxpayer money to build redundant, costly infrastructure way out, encouraging a 50-year migration to the edge that was destroying rural landscapes and robbing older communities of much-needed support. By harnessing the state’s $22 billion budget, we have changed the bottom line for development in Maryland.
We’re already seeing results. On open space protection, we’ve won accolades from groups ranging from the Sierra Club to the National Trust for Historic Preservation. Since 1995 we have protected more than 275,000 acres from development, about a quarter of all the acreage ever protected in Maryland.
And it is not just forests and farmland. We have ensured that important cultural and historic sites will remain untouched by sprawl, such as the Civil War battlefield in Antietam, where more than 3,300 acres of open space are now off limits to development.
Urban Successes: Baltimore and Cumberland
Even more striking - as a change that people can see on the ground - is the revitalization that is happening in many of our older cities and towns.
Across Maryland, from the Allegheny Mountains in the West to the rural areas that surround much of our beloved Chesapeake Bay, there are communities with heartening stories to tell. They are as different as Baltimore, which has suffered a 50-year population decline, and Cumberland, a city in Western Maryland with multiple landmarks in the National Register of Historic Places and our first Certified Heritage District.
Baltimore and Cumberland have, in fact, been two of the biggest beneficiaries of smart growth. Both have tapped and combined numerous programs and policies to enable local officials to create momentum for rebirth in older neighborhoods that had stagnated or declined.
A full account of all the smart growth support the state is providing would fill this journal, but we can summarize the programs that directly promote urban renewal and historic preservation and illustrate how they have worked in specific cases.
The Can Company in Baltimore tops our list of success stories. This late-19th-century can manufacturing plant sat empty and decrepit for more than a decade before it was transformed into a bustling retail and office complex a few years ago.
We like to think of this redevelopment project in Canton, a waterfront community on the city’s eastside, as the poster child for smart growth. Now home to approximately 750 jobs, it is in the heart of a Priority Funding Area. It was the first project to benefit from our brownfields cleanup program, which offers technical and financial help to clean up contaminated former industrial sites and return them to productive use.
Can Company tenants have taken advantage of our Job Creation Tax Credit, which rewards employers who create 25 or more new jobs within a designated growth area, and our Live Near Your Work incentives. The latter provides $3,000 for a downpayment or closing costs to employees who buy a home in designated neighborhoods near their workplace. The developer, Struever Bros. Eccles & Rouse, made the Can Company project work financially by using federal and state historic preservation tax credits.
Among all these programs, the Maryland Heritage Preservation Tax Credit has emerged as our most effective smart growth tool. The program provided tax credits for up to 25 percent -- the General Assembly voted earlier this year to reduce it to 20 percent -- of eligible rehabilitation costs for historic buildings. The rehab projects completed in 1997, the first year of the tax credit, involved just $1 million in private investment. Last year, expenditures for completed projects approached $135 million.
The smart growth benefits of these tax credits extend well beyond a one-shot investment in a historic building. They have proved to be a powerful catalyst for redevelopment in older communities and in marginal neighborhoods that have stubbornly resisted other revitalization efforts. Again, we point to the Can Company in Canton, where several large townhouse and mixed-use developments are going up today and individual row houses are being renovated on virtually every block. The building boom has been so strong it is spilling into the neighboring community of Patterson Park.
We expect to see the same phenomenon take hold in Baltimore’s West Side, a historic district where the first of several major projects - the Atrium Apartments - opened last year. In June Bank of America broke ground on a 394-unit apartment and retail project called Centerpoint, and weeks later the University of Maryland opened its new law school and the Thurgood Marshall Law Library, illustrating our commitment to keep state facilities in existing communities. Most recently work has begun on the redevelopment of the long-shuttered Hippodrome Theater into a major Broadway playhouse.
The extraordinary success of our historic tax credit program was largely unanticipated. One reason it has been so popular is that it provides developers cash flow in their first year, thereby reducing the risks that have made lenders steer clear of projects in blighted areas. For the state, the fiscal impact has been tremendous. An independent analysis of fees and taxes generated by the Can Company showed that we are receiving $3.65 for every dollar of tax credit expense.
And the number of successful historic preservation projects in Maryland keeps growing, with commercial rehab costs alone - homeowners also are eligible for the program - adding up to more than $445 million for approved projects now under way. Tide Point, a former Procter & Gamble soap plant converted to office space across the Baltimore harbor from the Can Company, opened last year and is boosting property values in nearby Locust Point. Montgomery Park, once the mammoth home of Montgomery Wards’ catalog warehouse in West Baltimore, has been transformed into an office park, with the Maryland Department of the Environment as its first tenant.
The city of Cumberland is another big beneficiary of our historic tax credits. Late last year, CBIZ, a fast-growing business services company, finished a multi-million dollar rehab of a century-old clothing store next to its office in Cumberland. By expanding into the adjacent building rather than moving to the suburbs to accommodate its growth, CBIZ kept 130 office workers in the city’s core. About 50 of them were new to downtown.
Like Baltimore, Cumberland has received state help with brownfields clean up and tapped our Neighborhood Business Development loans. The city also got more than $600,000 from the Maryland Heritage Areas Authority to stimulate economic development through cultural tourism.
Cumberland received a $1 million Community Legacy grant in 2001, the first year of a program created to help communities implement comprehensive revitalization strategies. The city is using the money for housing improvements, streetscape work, and commercial projects that are leveraging private investment to invigorate a historic downtown that has enormous potential.
“Smart Codes” and Other New Initiatives
Again, the list of smart growth programs supporting preservation and revitalization across the state is long - and growing.
Over the past two years, for example, we have completely rewritten our Building Rehabilitation Code to make it easier and less costly to renovate and reuse older structures. We also have drafted two model “Smart Codes,” one to make it easier for cities and towns to do infill development and another to encourage the development of “Smart Neighborhoods” - the kind you find in Annapolis, our state capital and a city whose charm comes from eclectic streetscapes and historic architecture that would not be allowed under modern codes.
A Quality of Life Issue
Smart growth has propelled us into a new era. Throughout the 1980s and early 1990s, concerns about sprawl were usually couched in environmental terms, as an unsustainable trend that was doing irreversible damage to farmland, woods, and waterways. Indeed, in Maryland, support for Smart Growth was rooted in the passion residents feel for saving the Chesapeake Bay.
But in recent years, many people have begun to understand how sprawl chips away at their quality of life as well, and they have become keenly aware of what we’re losing by allowing historic buildings and landmarks to languish and decay.
For Maryland, the concept of preservation is the essence of Smart Growth. We now know that restoring older communities and saving green space are complementary goals. In fact, you can’t have one without the other.
This realization will take us far in the ambitious quest to alter development patterns that were 50 years in the making and create a new ethos supporting growth that protects and enhances what we already have. #ForumJournal
Publication Date: Fall 2002