The Annapolis City Council approved a measure last night that allows the city to establish an independent, non-elected board to fund large-scale urban development.
The council, in a 5-4 vote, approved a charter amendment that gives the city the power to create a revenue authority. Such boards finance local construction projects and urban revitalization plans privately instead of through local government.
The bitterly divided council voted only to make such a revenue authority legal. Decisions about the size, scope and sweep of the city's revenue authority will come later.
Voting for the measure were Mayor Alfred A. Hopkins and Aldermen Shep Tullier, Carl Snowden, M. Theresa DeGraff and Ellen O. Moyer. Opposing it were Aldermen Wayne Turner, Louise Hammond, Dean Johnson and Samuel Gilmer.
Some aldermen argued that the authority would give the city the option to fund projects without spending taxpayer dollars and without tying the development in government red tape. The revenue authority would have only as much power as the city decided to give it and would not be allowed to approve any projects without council approval and public input, supporters said.
"We would be irresponsible not to employ every tool available to us," said Ms. Moyer, a Ward 8 Democrat. "A revenue authority is a reasonable tool that may or may not be used, depending on the scrutiny of the different projects and whether each makes sense."
But other council members contended that the revenue authority would create a grab bag of high-cost development projects without proper citizen input or government oversight.
"If we create a revenue authority without knowing precisely what it is we're adopting, we will be properly nailed to the wall legally," said Mr. Johnson, a Ward 2 independent. The projects would be exempt from city taxation, and the authority would have the power to condemn property in the city limits, he argued.
Revenue authorities are small corporate boards that sell bonds and collect fees to finance projects, from stadiums to parking garages. An authority is governed by board members who are appointed by local government officials.
Critics have accused pro-development aldermen of using the revenue authority as an underhanded tool to fund a conference center for the inner West Street corridor. The council has failed to approve funding for that project.
Another major criticism is that the revenue authority might ultimately be bailed out by the city government -- and taxpayer dollars -- if it stumbles into poor investments.
The council passed two amendments by Mrs. Hammond, a Ward 1 Democrat, barring any future revenue authority from funding a conference center or seeking government money.
Some residents vowed to bring the charter amendment to referendum in 1997, when the city holds its next elections. To do so, 20 percent of the voting public, or approximately 1,800 people, must sign a city-wide petition.