Don Fry Commentary on WYPR
Baltimore City’s current residential “boom” downtown and in Federal Hill, Inner Harbor East, Fells Point, Canton, and many other areas is obvious to any casual observer and is remarkable to even those who have lived here all of their lives. This development has begun to grow the city’s real estate values and its property tax base. It has put the city in a position to begin reversing decades of population decline.
So, ask yourselves a question. What single government policy or action triggered this growth spurt?
The answer? None. Government didn’t launch this growth. The market did.
Baltimore’s continuing downtown “renaissance” positioned the city as an attractive urban option for residents; and government incentives certainly helped. But this growth is occurring because of the confluence of basic market forces — opportunity and value generating investment and economic activity.
Government can nurture this beneficial market balance. But government can also nudge the balance off-kilter. That’s what many developers fear is beginning to happen in Baltimore City as a result of recent actions by its government leaders.
Developers point to unfunded mandates recently imposed by the City Council on housing developments and new “green” mandates for commercial buildings. The mandates are well-intentioned, but costly to developers. Those extra costs, plus other new impact fees that the city has begun extracting from them, threaten the cost-effective balance that allows projects to be financially feasible, developers complain.
City leaders need to take note. Economic growth in a city or region boils down to one thing — opportunity. Where it exists, entrepreneurs will invest and quality products will be developed to meet demand. Opportunity drives markets, and markets drive economies.
Public policies for economic development must, above all else, carefully nurture the opportunity factor – not stifle it. This is a fundamental concept that even the most well-intentioned elected officials in Baltimore City cannot afford to forget.
For the Regional Business Report, this is Don Fry, President and CEO of the Greater Baltimore Committee, for 88.1 WYPR, your NPR news station.