FULL TRANSCRIPT OF STATE SEN. NATHANIEL MCFADDEN'S OFFICIAL STATEMENT: EDO vs. EBDI
(BALTIMORE - May 31, 2012) - This is the full transcript of State Sen. Nathaniel McFadden's official statement at yesterday's press conference surrounding East Baltimore Development, Inc.:
State Sen. Nathaniel McFadden:
In 2002 residents of the Middle East Community and parts of the surrounding blighted neighborhoods of Broadway East, Oliver, Johnston Square, and Gay Street I supported an unparalleled revitalization project that included 2 million square feet of biotechnology space north of Johns Hopkins, and up to 2,000 new and rehabilitated housing units for low income, market rate, and affordable housing.
Promises were made to the citizens of Baltimore – 8,000 new jobs, training and career development for East Baltimore and City residents, employment opportunities for a range of skill levels, and a major commitment to minority inclusion. These and other promises were included in the April 15, 2002 “Agreement for Minority Inclusion in the East Baltimore Housing/Biotech Park Development Project” (Inclusion Agreement) signed by then Mayor, now Governor Martin O’Malley, Johns Hopkins representatives, and the unofficially formed East Baltimore Development, Inc. (EBDI) which was charged with project oversight.
The Inclusion Agreement outlined the structure of EBDI and laid the foundation upon which the project would be developed. Objectives of the agreement include:
1. Dramatically increasing contracting and procurement dollars spent with minority businesses in all aspects of the East Baltimore Development project, as well as spur greater involvement of minority businesses in identified growth sectors of the City’s economy, including but not limited to retail, technology, and real estate development; and to dramatically increase the number, magnitude and success rate of minority businesses in Baltimore City, at all levels of the Development Project.
2. Increasing existing opportunities for minority equity participation including real estate development and expanding start up businesses.
3. Committing to professional staff diversity, with at least one, qualified minority senior level staff person in each of the organizations associated with the East Baltimore Biotech Project to include, but not limited to, EBDI and East Baltimore Incubator (EBI).
4. Regular progress reporting –
a. The EBDI must report to the Mayor and City Council its progress and results in implementation of the terms of this Minority Inclusion Agreement on a quarterly basis, and will also specifically report, on a monthly basis, the MBE/WBE participation through Citistat to proactively track minority business participation throughout the development process.
b. The Mayor’s Office of Minority Business Development must issue a written annual report to the Baltimore City Council and members of the Baltimore City Delegation to the State Legislature to include a status report on the implementation of the Minority Inclusion Agreement.
5. Engaging minorities in all aspects of contracting, construction, professional services, commodities, manufacturing and services.
6. Increasing the number of significant minority-owned retail businesses, high-tech and biotechnology firms.
7. Developing a Technical Workforce
a. The City must utilize collective resources to provide high-tech employment opportunities for Baltimore residents. Multiple entities and significant resources must be dedicated to help deliver the appropriate levels of workforce development training that will be required to ensure that the biotechnology park is a success. This includes Empower Baltimore Management Corporation, Baltimore City Community College, University of Maryland Biotechnology Institute, Morgan State University, Hopkins-Dunbar Project, the Baltimore Workforce Investment Board, Mayor’s Office of Employment Development and community- based workforce development programs, including the Gate Program and The Chance Center.
b. Qualified displaced residents shall be given a preference for job training opportunities over other qualified applicants that are not former residents of the biotechnology park site.
8. Making laboratory and office incubator space available to minority startup ventures.
9. The Administration helping minority entrepreneurs take advantage of the economic development initiatives underway, as well as future initiatives, by providing a user-friendly point of contact for information and ensuring access to relevant agencies. It is City government’s responsibility to facilitate effective outreach to the minority business community.
10. Community Reinvestment - To ensure that the economic success of the biotechnology park benefits not only the tenants and participants of the park itself, but also provides ongoing benefits to the surrounding community of East Baltimore residents.
a. A certain percentage of all eligible public funds appropriated for the East Baltimore Biotech Project shall be reserved for the purpose of making equity or equity type investments in businesses to be located in the biotech park and other business opportunities that would flow from the biotech park.
b. A selected minority owned and controlled CDC, CDE, or CDFI shall manage and award the community reinvestment funds to recognized Community Development Corporations (CDCs) located in East Baltimore to be used to facilitate the development of East Baltimore community institutions, commercial or residential development, or infrastructure improvements for the surrounding community.
On September 5, 2002, the East Baltimore Development, Inc. (EBDI) was officially organized for the purpose of coordinating and implementing all aspects of the East Baltimore Biotech Project with the ultimate goal to preserve, improve, revitalize and rebuild the urban infrastructure and quality of life for the residential and business communities of East Baltimore. Four of its major tasks were to:
- Assist the City, including the Department of Housing and Community Development, in administering community relocation benefits for the Project which would enable residents in affected neighborhoods whose properties have been acquired for the purpose of redevelopment to relocate to comparable housing with the objective of improving the quality of life, improving living conditions, and increasing economic and social opportunities for families affected by relocation;
- Create a centralized comprehensive human development agenda with components and objectives that address, at a minimum, job training and placement, income security and asset development, education, health and child care; and
- Target, secure, allocate and regulate investments in and resources made available for the Project, whether public or private, to insure the maximum practical utilization of minority and women-owned businesses with direct ties to the Renewal Areas in terms of residency or employment opportunities as a means to fulfill the objectives and to comply with its continuing obligations under the Inclusion Agreement; and
- Develop guidelines to determine the means and methods by which the community reinvestment obligations under the Inclusion Agreement are met both generally and on a transactional level.
The Inclusion Agreement and EBDI’s commitments as outlined in two Unanimous Written Consents of the Board of Directors dated November 8, 2002, were codified in Amendment 8 of the Middle East Urban Renewal Plan dated August 15, 2005 and approved by the Mayor and City Council October 7, 2005. This plan details land use, and design guidelines for the New East Baltimore Community in addition to procedures that must be followed to make changes in the plan. Changes in the plan may only be made through legislation approved by the Mayor and City Council.
Ten years have passed and promises to the Citizens of Baltimore have not been kept! Recent reports acquired by me revealed the following:
- Promise of affordable housing - virtually nonexistent.
While the 2007 fall of the housing market and subsequent economic recession adversely impacted housing development, the Johns Hopkins Graduate Student Housing moved forward, and it is rumored that market rate housing is being planned with no prospects for low income or affordable housing.
- While procurement/contract dollars awarded to minorities in no way meet minority participation goals (dismal at best), what is even more alarming is that over the past two years, dollars awarded to minority contractors were awarded to minority contractors outside of Baltimore City. For example:
Graduate Student Housing - October 2009 – March 31, 2012 – approximately 67% of contract dollars awarded to minority contractors were awarded to minority contractors outside of Baltimore City.
P-1 Parking Garage – December 2010 – February 2012 – approximately 39% of contract dollars awarded to minority contractors were awarded to minority contractors outside of Baltimore City.
Public Health Lab – recently started January 2012, with half of the project awarded by March 2012, approximately 32% of contract dollars awarded to minority contractors were awarded to minority contractors outside of Baltimore City.
- As of March 2012 Baltimore had a 10% unemployment rate and significant jobs have not materialized for the indigenous project area population which is approximately 99% African American, or for Baltimore City residents at large.
Procurement dollars awarded to minority contractors outside of Baltimore City resulted in minimal local hires. For Example:
Graduate Student Housing Project – approximately 84% were non Baltimore City workers.
P-1 Parking Garage – approximately 69% were non Baltimore City workers and 21% were non-minority workers for a total of 90% non indigenous workers.
Public Health Lab – as of March 2012, ninety-six (96) workers were employed on the project of which 34% were African American, 36% Hispanic, and 28% non minority worker
- Community based job training infrastructure has not been established.
There are TOO Many East Baltimore and Baltimore City unemployed and underemployed residents in need of supplemental services to prepare them for employment. These and other residents are waiting for the promise of job training and career development.
- Community Reinvestment infrastructure has not been established.
EBDI has acquired and used millions of dollars in public funds and have not followed through on the community reinvestment promise as outlined in the Inclusion Agreement.
Ladies and Gentlemen, we cannot tolerate this level of performance by EBDI. There is too much at stake for our Baltimore City residents. In light of today’s economic climate, we recognize that changes may be needed and WE are willing to work with EBDI and Baltimore City elected officials to discuss strategies for improvement. Any change in the Middle East Urban Renewal Plan to include the Inclusion Agreement should be transparent, and made in accordance with the law – via legislation heard by the community through the appropriate Committee(s) of the Baltimore City Council, and approved by the Mayor and that legislative body. LET’S GET TOGETHER AND MAKE THIS HAPPEN FOR THE CITIZENS OF BALTIMORE!