For school, city rents back a $1 museum for $540,000

Port Discovery praises 20-year deal

Schaefer calls plan `outrageous'

March 15, 2003|By Julie Bell | Julie Bell,SUN STAFF

Baltimore City public schools have agreed to pay Port Discovery $540,000 annually to house a magnet high school in the Market Place building that the money-losing children's museum leases from the city for $1 a year.

The school system said it would spend an estimated $6 million to $8 million to renovate the building, which was turned into the museum with the help of at least $12.1 million in state and city funds.

Baltimore schools Chief Operating Officer Mark Smolarz acknowledged that the cash-strapped district would rather have the city space rent-free. But he said the deal provides an ideal, relatively low-cost location for a downtown high school focused on tourism, technology and finance.

Port Discovery officials describe the 20-year pact as a win-win situation for a school in need of space and a museum that's worth saving. But others harshly criticize the terms, saying it is inconceivable that taxpayers should have to pay $360,000 a year in rent and $180,000 in operating costs for space that is already theirs.

It "sounds like a buddy-buddy deal," said William J. Skinner, president of the Maryland Tax Education Foundation, a sister organization to the lobbying-focused Maryland Taxpayers Association. "It isn't going to take too long for anyone with common sense to scratch their heads and say, `These people are nuts.' "

State Comptroller William Donald Schaefer, a former Baltimore mayor and Maryland governor who is on the state Board of Public Works, which must approve any such deal, called it "outrageous" and said the city should end Port Discovery's lease if the museum can't make it on its own. "You can bet one thing: I won't sign off," he said.

Mayor Martin O'Malley did not respond to a request for comment.


The museum, which has been struggling financially and has never met attendance projections, announced the rough outlines of the agreement Feb. 19 but refused to disclose financial details, as did the financially struggling school district.

Baltimore City schools face a projected $28 million cumulative deficit by the end of this school year. In December it laid off nearly 400 temporary workers and in January considered furloughing its entire 12,000-person work force for several days. It backed off the furlough after teachers balked.

The two sides initially said they couldn't discuss the terms because negotiations were continuing, though they were simultaneously pressing to get required approvals from the city Board of Estimates as early as Wednesday and the school board as early as March 25.

On Thursday, Port Discovery Chief Executive Officer Alan M. Leberknight decided to disclose key terms as The Sun prepared an article on the secrecy surrounding the taxpayer-financed proposal. The Board of Estimates now appears unlikely to consider the deal until at least March 26. It is also subject to approval by the state Department of Education.

Smolarz conceded that school officials were trying to avoid disclosing details of the latest proposal until the last minute because of opposition the school has faced in the past two years to whatever downtown site has been proposed.

The school system had to scuttle a deal for space at Charles Plaza after business people, led by Baltimore Orioles majority owner Peter G. Angelos, opposed it as incompatible with redevelopment plans. That deal called for the district to pay more than $1 million per year in rent and operating costs.

Now, Smolarz said, developer David Cordish - who built up the area surrounding the museum into the successful Power Plant Live restaurant and entertainment district - is trying to kill this proposal. Cordish has estimated he could generate $3 million to $4 million in taxes from the museum building if he could redevelop it as part of the district.

"My concern is I didn't want to give Mr. Cordish any more information than I needed to until the last minute because he will do whatever it takes" to kill the deal, Smolarz said, adding that he and Cordish personally get along well. Killing the pact in favor of a Power Plant Live expansion, Smolarz said, would send this message: "We're saying it's not OK to educate our children but it's OK to go drink into a stupor."

Cordish has sued rival developer C. William Struever, who is on the boards of both the school district and Port Discovery, alleging Struever is pushing expansion of the school at the museum to harm Cordish's project.


Late last summer, the school system made a last-minute deal to enroll up to 90 ninth-graders during the current school year at the museum, which has long offered a small amount of space to Baltimore schools for educational programs.

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