Baltimore Sun
By Larry Carson | larry.carson@baltsun.com

After several years of delay, Maryland's second attempt to foster urban-style mixed-use development at state mass transit rail stations is moving forward in Savage, Howard County, where a $175 million combination of apartments, offices, shops and restaurants is envisioned instead of a bleak 13-acre parking lot.

"Our market are folks connected to NSA (National Security Agency) and BRAC (the federal Base Realignment and Closing process)," said Terry Richardson, a founding partner and executive vice president of Petrie Ross Joint Ventures, the developer that built the Parole Town Center in Anne Arundel County.

The Savage MARC train station, just off Route 32 near U.S. 1, is just two miles from Fort Meade, and Richardson said the more than 400 apartments and 78,000 square feet of offices planned should attract both federal workers and others who may work near other rail stations or in Washington or Baltimore.

"People want to live in this county," Richardson said. "The schools are great and the business climate and orientation is second to none."

But before the project could make progress, the county government had to approve an innovative Tax Increment Financing or TIF financing scheme for the first and most important phase; a 704-space five-story garage, infrastructure, and the first four-story apartment building.

That's the key approval granted Monday night by unanimous votes from the Howard County Council on three bills creating the financial framework for the deal to progress.

Now, Richardson said, he can use that commitment to sign partners to build the various pieces of the project. Those partners contracts, together with all-important financing, will allow the garage to go to construction, perhaps in another year.

"This is hurdle Number 1," he said after the three 5-0 votes, taken without discussion. "Hurdle Number 2 is the thawing of the credit markets." Richardson said his firm is negotiating with partners now, but they wanted to see the TIF tax district financing in place before signing anything.

Officials are hoping that by the time the work is ready to begin, the worst of the recession is over.

So far, only one of the 11 transit sites identified by state officials as potential mixed-use projects has begun construction; at the Owings Mills Metro station. Savage is second, said Jack Cahalan, spokesman for the State Department of Transportation.

County Executive Ken Ulman hopes the project will also help put Howard County, which has few connections now to regional transportation systems, more into people's minds.

"I think it's important to get that first project done," Ulman said, noting that other, similar developments could later be built in N. Laurel or Jessup.

Eventually, the county hopes to see 416 apartments in four buildings, 21,000 square feet of retail, offices where some residents could also work, 9,200 square feet for restaurants and a 150-room hotel, along with the garage. All that would replace a state-owned lot that produces no revenue. Howard law requires that 15 percent of the apartments be for limited income families.

The bills approved a contract with Petrie Ross Joint Ventures, and create the TIF district. The garage would take just under three acres and remain state-owned, financed with bonds. Later, revenues produced by the commercial and residential buildings on land the developer would buy would be used to pay the debt. Howard County rezoned the Savage and Dorsey MARC stations in 2004 to encourage what is called "transit oriented development" along the redeveloping U.S. 1 corridor.

County officials said that although the financing will delay some of the revenue return, there are other benefits.

"We get payback right away," via income taxes from residents and people doing business, said Dick Story, CEO of the county's Economic Development Authority. "The increment pays off the bond, but with new jobs and money in motion, the multiplier impact begins right away. This is the closest new development to Fort Meade anywhere in Howard County," Story said.

Construction is under way now at the fort for the first large federal agency slated to move there from Northern Virginia.

The Savage project was first announced by then-Gov. Robert L. Ehrlich Jr. in August 2006, when the plan was for the state to finance the garage construction, but that proved too expensive given the state's budget woes.