Officials in Md. worry as Army signs deals

Base projects must share improvement costs, critics say

October 01, 2007|By Timothy B. Wheeler | Timothy B. Wheeler,SUN REPORTER

With "strength" as its watchword, the Army is going strong into real estate these days.

The service, one of Maryland's biggest landowners, is negotiating development deals that could bring tens of thousands of workers as bases grow around the state and more than $1 billion worth of improvements to the aging, underfunded military installations.

But local governments, which might have to shoulder associated infrastructure costs, want the Army or its private developers to help ease their economic burden.

FOR THE RECORD - An article in yesterday's editions about private developers leasing land on Army bases misstated the status of one project at Aberdeen Proving Ground. The Army is negotiating with APG Development Partners - jointly owned by Weston Solutions Inc. of West Chester, Pa., and LCOR Inc. of Bethesda - to build a law enforcement training center and research and development facilities in the Edgewood area of the proving ground. The article also misspelled the name of Christopher Augsburger, spokesman for the Baltimore District of the Army Corps of Engineers.
The Sun regrets the errors.

Chevron Energy Systems is building a $158 million power plant at Fort Detrick in Frederick, and the Army is in negotiations with private firms to construct a $50 million hotel, conference center, shops and offices.

Millions of square feet for offices, laboratories, shops and restaurants are in the works on bases in the Baltimore area, at Aberdeen Proving Ground in Harford County and at Fort Meade in Anne Arundel County.

All will be built by private developers, under 50-year leases that are expected to require the developers to provide new or renovated buildings and facilities on the bases.

The development plans are part of a nationwide push by the Department of Defense to find new ways of financing upkeep and upgrades on military installations when the defense budget is being stretched to support combat operations overseas. Begun years before the Pentagon announced its sweeping plan for base realignment and closures, known as BRAC, it has since been seized upon as a way to help provide the facilities and services needed at installations slated to expand, such as Aberdeen Proving Ground and Fort Meade.

The Army has finalized eight "enhanced use lease" deals with developers nationwide that are expected to generate at least $1 billion for the Army. Two are in Maryland. Nine more, including three in the state, are close to signing, and another 31 are in the works.

One of the Maryland lease deals just signed, allowing a division of Minnesota-based Opus Group to build up to 2 million square feet for offices and labs on Aberdeen Proving Ground's 73,000 acres, is expected to bring in at least $500 million over the life of the agreement, the head of the Army's leasing program estimates.

Army officials say they are striving to ensure that the development deals are compatible with the missions of the bases. Aberdeen Proving Ground's G.A.T.E. project, short for Government and Technology Enterprise, likely will draw defense contractors already serving Aberdeen's work force or the added staff expected in the next several years as base realignment brings about 5,000 new high-tech jobs from Fort Monmouth, N.J.

"It helps the Army make up for budget shortfalls in their operations and maintenance budgets, and takes care of things we can't take care of right now - worn-out buildings and roofs that can't be repaired," said Bob Penn, leasing program director for the Army.

Penn and his 10-person staff at the Baltimore District offices of the Corps of Engineers have hammered out lease deals across the country on the Army's vast holdings. Recently, he was in Yuma, Ariz., signing a pact with General Motors Corp. that would let the automaker build a test track for its new cars and trucks on the Army proving ground there, in return for GM constructing a separate track on which the Army can try out its heavy-duty military vehicles.

"He's our Donald Trump," Christopher Augsberger, a spokesman for the Corps' Baltimore District, said of Penn.

Local concerns

But the Army's push to develop its land in Maryland is generating static among some local and state officials, who contend that the federal government should help pay for the costs of road and highway improvements and other public services needed to accommodate the growth occurring on and around military bases.

Anne Arundel officials, for instance, point out that an office complex planned by Trammell Crow Co., a Texas-based developer, at Fort Meade would have to pay $6.7 million a year in local and state property taxes, plus $3.5 million in impact fees if built on private land. The complex could house up to 10,000 workers.

"I'm not expecting a check from the Army," said County Executive John R. Leopold, "but I am hoping for this property tax revenue from Trammel Crow and its tenants."

There's just one wrinkle: Under Maryland law, military bases are exempt from property taxes, under legislation initially adopted in the 1940s. The General Assembly clarified or extended that status two years ago to exempt private entities on federal land if they were providing housing to military families or their work involved national defense or homeland security.

Leopold, who was a state delegate then, does not recall voting for the measure, which passed unanimously. But now, he says, he's thinking about trying to get it repealed unless he can get Trammell Crow to pay its fair share of the $5 billion worth of county road and highway upgrades proposed to handle growing traffic.

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