The Baltimore City Board of Finance approved Monday issuing $35 million in Tax Increment Financing, TIF, bonds to pay for infrastructure around the Harbor Point site, one of the final steps before construction can begin.
The board learned during presentations from public financing consulting firm Municap that the project won’t be as expensive as originally thought because the bridge from Central Avenue is cheaper and the interest rate on the bonds has dropped.
Stephen Kraus, chief of the Bureau of Treasury Management, told board members those changes come refining its numbers.
“That’s why we have 37 iterations of this thing; as you get into it deeper and deeper the numbers become better and better and you refine them,” Kraus said.
The original cost of the bridge--$10.5 million—dropped by nearly $4 million and the interest rate on the bonds was cut nearly in half.
In addition, apartments were added to the project that will include headquarters for Exelon on the site between Harbor East and Fells Point.
The bonds, which could be issued in January, would go to Beatty Development, the project’s manager. Beatty would then use the bonds as collateral for a construction loan from M&T Bank, the construction lender, to secure a loan to build the infrastructure. Interest earned off the bonds would go to directly pay the loan.
Officials say that the city will save $5 million in interest by issuing the bonds this way as opposed to issuing the bonds directly on the market.
While the initial bonds have been approved, environmental regulators still must approve an air monitoring plan for the site, the former home of Allied Chemical, a chromium plant that closed in 1985.