A coalition of local unions and advocacy groups debuted a proposal Wednesday that could force the Johns Hopkins University, the University of Maryland Medical Center and other nonprofit institutions in Baltimore to cough up more money for the city, additional revenues that would be earmarked for community programs like land trusts, urban farms and grassroots financial institutions.

The proposal — which would go before city voters next year if it gets enough support — takes aim at a group of nonprofit medical institutions and universities that pay nothing in property taxes, but that make a collective annual contribution of $6 million, known as a “payment in lieu of taxes” or PILOT, under a 10-year deal struck with the city in 2016.

Though the charter amendment wouldn’t alter that deal itself, backers hope it would compel the city to lean more heavily on the major nonprofit institutions in town that don’t contribute property taxes.

The amendment would establish a new “Community Wealth Building Fund” filled either by drawing existing property tax revenues — at a rate of least 6 cents for every $100 of assessable property value, or approximately $26 million — or an equivalent amount in voluntary contributions from the medical and educational nonprofits.

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Calling themselves With Us for Us, representatives from a broad coalition of labor and activist groups — including Maryland CASA, Organizing Black and local chapters of the AFL-CIO, Teachers and Researchers United and 1199 SEIU United Healthcare Workers unions — gathered Wednesday afternoon at the Plantation Park Heights Urban Farm to rally for the charter amendment.

“We know private entities, Hopkins included, can pay their fair share into Baltimore communities,” said Sandy Peeples, a member in the union of Johns Hopkins teachers and grad students, who argued that the university sits on a growing endowment while largely separating its employees and students from the broader Baltimore community.

“To have decent housing, fair wages, good public transit, we don’t need private wealth. We need community wealth,” Peeples said.

Johns Hopkins University graduate student and organizer with Teacher And Researchers United UE Local 197 Sandy Peeples speaks during the kickoff event for With Us for Us — a coalition centered around community wealth building in Baltimore City — at Plantation Park Heights Urban Garden on Wednesday, Nov. 8, 2023. (Kylie Cooper/The Baltimore Banner)

Revenues contributed to the fund would have to support “community wealth building” initiatives in the city, which might include worker-owned co-ops, community-owned financial institutions, community land trusts, community-owned gardens and other institutions of collective ownership. The fund could not replace city money already budgeted to these types of programs, according to the proposed amendment.

Under the PILOT agreement established in 2016, the Johns Hopkins University, the University of Maryland Medical Center and more than a dozen other nonprofit institutions together contribute $6 million a year to city coffers. The agreement was established in recognition of those institutions’ reliance on city services, but critics have argued for years that the arrangement was a bad deal for the city given how much it is forgoing in property tax revenues.

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Collectively, those institutions own over $5 billion worth of property in Baltimore, according to a 2019 city estimate, holdings that would contribute $120 million to the city’s finances each year if they were taxed.

The language of the proposed charter amendment has already received Board of Elections approval, meaning that if backers can collect signatures from 10,000 supporters then the measure will appear on the ballot in the 2024 general election. Baltimore residents have historically voted overwhelmingly in support of most ballot initiatives. In 2022, voters approved seven different ballot measures, with the least popular proposal — a measure imposing term limits on city leaders — still passing with 71% of the vote.

A spokesperson for the president’s office at the Johns Hopkins University declined to comment on the proposed measure, while a spokesperson for the Maryland Hospital Association did not respond to requests for comment.

A spokesperson for Mayor Brandon Scott also did not respond to a request for comment.

Though the PILOT agreement between the city and these nonprofit institutions doesn’t expire until 2026, it has come under pressure before.

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Four years ago, as Baltimore stared down the prospect of a state law requiring heftier local contributions for schools, city leaders contemplated reopening the 2016 agreement and amending it, a move that union leaders and other advocates pushed for at the time.

The City Council held a hearing to discuss the option in December of 2019 during which Hopkins pushed back, noting that the nonprofit institution provides other economic benefits to the city and contributes other, non-real estate taxes. Hopkins’ then vice president of economic development argued that calling on the tax-exempt organizations to contribute more would “squeeze these institutions who try to do good, and are doing good,” The Baltimore Sun reported at the time.

The city’s Department of Finance, though, came out in support of considering a renegotiated deal. Finance officials said in a letter to council members that the city has limited ability to compel the nonprofit institutions to make large contributions to the general fund, and, as a result, “these institutions significantly under-contribute for their share of City provided services.”

While Baltimore has the highest property tax rate of any jurisdiction in Maryland, finance officials also noted at the time that the city is home to nearly 20% of the state’s tax-exempt property. The Finance Department said it was “the right time to reconsider the State law that exempts nonprofits from property taxes” given steps the state was taking to require more local contributions to schools.

That funding formula has since been revised and is already squeezing Baltimore’s budget.

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Organizers at Wednesday’s rally advocated for increased support for grassroots, neighborhood-based programs like land trusts as a way to lift up long-neglected communities. For decades, Baltimore has funneled private and public money into areas like downtown and the Inner Harbor, while community-based programs have an opportunity to begin restoring low-income and Black neighborhoods, said Krystle Okafor of SHARE Baltimore, a group supporting community land trusts.

“The ‘eds and meds’ are empowered to remake our city in ways that suit their needs,” she said. “With the community wealth building fund, we can level the playing field, returning resources and power back to our neighborhoods.”

If approved by voters, the proposed charter amendment would also establish a 15-member commission, appointed by the mayor, to advise the city on future PILOT agreements. That component is intended to lay groundwork for leaders to negotiate a stronger agreement with the property tax-exempt institutions when the 10-year agreement with them lapses in 2026, Loraine Arikat, policy analyst with the labor union 1199 SEIU said Wednesday.

Other cities have already established better deals with local nonprofit institutions, Arikat said, pointing to one model in Boston as well a PILOT agreement between Yale University and the city of New Haven that sees the Ivy League school contributing more annually than all of the organizations in Baltimore’s deal combined.

In Boston, Arikat said, stakeholder groups are tasked with reexamining their PILOT deal. Public reporting tracks how much each institution pays annually.

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“We have none of that,” she said. The least Baltimore could have is an agreement with these tax-exempt institutions that is “transparent, public and fair.”

adam.willis@thebaltimorebanner.com

Adam Willis covers city government for The Banner, including the impacts of the large COVID-19 stimulus package that Baltimore received from the federal government. 

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