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Raw: State to relocate 3,300 employees to downtown Baltimore

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Maryland Gov. Larry Hogan on Monday announced a plan to relocate 3,300 state employees from 12 state agencies to the downtown Baltimore central business district. Hogan said the state is committing $50 million to pay for the relocation of state agencies and employees to downtown Baltimore.

Video Transcript

ELLINGTON CHURCHILL: I want to welcome everyone and thank you for joining us here today at McElveen Plaza in the backdrop of downtown Baltimore. My name is Ellington Churchill. And I am the secretary for the Maryland Department of General Services. And I have the privilege of being your emcee this afternoon.

It's a beautiful day. And we've started just at the point where the sun is starting to come out. And it's a rare event where we have the honor and privilege of being joined by our governor Larry Hogan, our lieutenant governor, Boyd K. Rutherford, our senate president Bill Ferguson, and the president of the Downtown Partnership, Shelonda Stokes.

Before we get to their remarks, I'd like to take just a moment to acknowledge some special folks here that have joined us today. The chief legislative officer and senior advisor to the governor, Keiffer Mitchell, and deputy mayor Ted Carter who stands over there. Thank you, deputy mayor for joining us here today.

One of General Services' responsibilities is to oversee the operation and maintenance of more than six million square feet of state owned government buildings and grounds. And we operate two government campuses in the state, one being in Baltimore's midtown, which houses 12 agencies with more than 3,000 employees, which just resides 10 minutes Northwest of this plaza. But General Services is also responsible for soliciting, securing, and overseeing the upfit of commercial office space for our government executive agencies through our Office of Real Estate.

And we are currently working with property owners in an expanding portfolio of more than four million square feet across the state, of which here in Baltimore 2 million square feet is distributed to over 21 agencies within 62 leases. In my time as secretary, Governor Hogan has consistently directed the executive department's take, the opportunity to improve the effectiveness, and how government delivers service. And in doing so, executive agencies must strive to create better working environments that limit resource consumption, promote human health, and productivity for all of our civil servants across the state, but especially for the more than 10,000 state employees who work here in Baltimore City.

Like everything in this last year, we are adjusting to the impact of COVID on our government offices. And although General Services has paused our leasing operations for a year, we continue to work with our executive departments to prepare for space in a post-COVID world to be ready to go into action once Governor Hogan affirms we should proceed. That is why it's an honor to work for our governor. He is the definition of a leader. And I thank him for his leadership.

It's also an honor to be able to introduce you today. Please join me in welcoming the 62nd second governor of the great state of Maryland. Larry Hogan. Governor.

LARRY HOGAN: Well, good afternoon, everybody. Thank you, Mr. Secretary. I want to thank Lieutenant Governor Rutherford, Senate President Bill Ferguson, and the president of the Downtown Partnership Shelonda Stokes for joining us here at McElveen Plaza for this important announcement. Over the last four months, we've been laser focused on putting shots into arms. Today, we are here to talk about a shot in the arm for the recovery and revitalization of downtown Baltimore.

A strong Maryland depends on a strong Baltimore City, which is why the entire state government has been working hard to improve the city. With Project CORE, we have removed more than 4,500 units of blight and leveraged over $1.9 billion in public and private sector investment in community redevelopment projects. We've invested $9 billion in direct state aid to Baltimore City, provided over $1.3 billion for public safety and crime control efforts, invested $4.7 billion in Baltimore City transportation projects, which is far more than any other jurisdiction in the state.

We provided record funding for city schools seven years in a row, an historic $8.6 billion for K through 12 education in the city of Baltimore. In fact, no administration in Maryland history has ever invested more in Baltimore City. Over the past year, as the secretary said, the COVID-19 pandemic has taken a devastating toll on the national, state, and local economies. Fortunately, Maryland's economy is recovering at a much faster pace than the nation and most other states. We've gained nearly 25,000 jobs in the first quarter of 2021. And we've had 11 consecutive months of job growth in Maryland.

Unfortunately, here in downtown Baltimore, office vacancies in the central business district are up nearly 34%. And major businesses like T Rowe Price and Bank of America have announced plans to relocate to other parts of the city. The state of Maryland has more than 15,000 state employees here. We occupy 2.2 million square feet of office space in the city. To help stabilize the downtown area, we have an ambitious plan to relocate 3,300 state employees from 12 different state agencies to the area in and around the downtown central business district.

Responding to the COVID-19 pandemic over the past year and the resulting teleworking policies and budgetary concerns forced, as the secretary said, a temporary pause in that effort. But that time allowed us to direct all state agencies to reevaluate, reimagine, and adapt their office footprints to incorporate new teleworking models where appropriate. Now that we have a clearer and more promising budget outlook, we were pleased to work together with President Ferguson and the legislature to budget for $50 million to help pay for the relocation of state agencies and their thousands of employees to this area of downtown Baltimore.

We're very pleased to begin that process today with the issuance of an RFP for the relocation of the Maryland Department of Human Services headquarters to the downtown central business district. DHS is the state's primary social services provider, serving over one million Marylanders every year. Moving the department and its more than 700 employees into 105,000 square feet of office space in downtown is an important first step in the recovery of the central business district.

Today, we are also announcing that the Maryland Department of Health, with its nearly 1,200 employees will also be relocating to the downtown central business district and will be the next agency to come. These two agencies-- I didn't want to step on the applause line from the senate president.

BILL FERGUSON: That was a great applause line.

LARRY HOGAN: These two agencies will bring the first of nearly 2,000 workers of what will become 3,300 workers in total to this downtown area, which will be a big boost for the revitalization and transformation of downtown Baltimore. I want to thank Secretary Ellington Churchill and his team at the Department of General Services for leading this relocation effort along with Secretary Padilla at DHS and Secretary Schrader at MDH.

I also want to sincerely thank Senate President Ferguson for strongly supporting this effort for Baltimore City and the former DGS secretary who also happens to be the lieutenant governor, Boyd Rutherford for his leadership in this effort, and for his vision of a more efficient and more effective state government. This announcement today is just one more way that together, we are changing Maryland for the better. Thank you.

ELLINGTON CHURCHILL: Thank you, governor. The governor mentioned it that there's probably no bigger advocate and no bigger strategist for a more efficient and nimble state government than our lieutenant governor, especially in a post COVID world. So please join me in welcoming our lieutenant governor, Boyd K. Rutherford, to the mic.

BOYD K. RUTHERFORD: Thank you, Mr. Secretary. Thank you, governor. The coronavirus pandemic changed how we go about our everyday lives in ways that we could not have imagined before. The last time the state and the country faced a pandemic was in 1918. Big Mike, I don't know if you were around at that time, but that was during-- I don't think so. That was during the administration of Harrington. And years prior to the first modernisation of state government that began under Albert Ritchie, excuse me.

To protect the safety of state employees and the public, we're able to shift, or we were able to shift, a significant portion of the workforce to remote activities in 2020. At the same time, the state workforce was able to keep pace with the demands of their daily jobs and keep the state's functions running effectively. Our bustling offices in our city center had changed. It changed from bustling downtown, to being at home offices, and Zoom meetings.

The pandemic forced us all to rethink and reimagine state government operations and the needs of our workforce in ways that fit the demands and the conditions of our current reality as well as our future. Last summer, we began evaluating our space needs and telework requirements in light of this once in a lifetime pandemic. I directed cabinet secretaries with the guidance of the Department of General Services to evaluate their future workforce needs in light of our expanded use of telework and what their post pandemic space needs would look like based on the new telework policy.

The pandemic has shown us two things. First, in order to compete and attract workers and create a viable and effective state workforce going forward, we need to offer modern functional adaptable workspace and options to match the flexibility that is emerging in the private sector. This pandemic era has shifted many private companies to move a large portion of their workforce to remote work, and some permanently.

Currently, 47% of our employees were able to telework during the pandemic emergency. Second, the size and scale of the offices we utilize now may not be necessary going forward. More importantly, we recognize that many of our state facilities are in such poor condition that it is currently costing us more money to maintain those buildings than to rent property downtown, and rent well-kept property downtown.

Accordingly increasing teleworking options have opened up opportunities to evaluate our space, space, leasing, and owned space to properly align them with the true needs of our workforce, and to reduce real estate and real estate related costs. I look forward to working on this process in conjunction with the Department of Budget and Management and General Services. And it is my hope that we will move forward and be able to move forward with more modern, vibrant workspace for our hardworking state employees, and that this investment will spur additional economic and civic revitalization and transformation in the downtown business district. Thank you very much.

ELLINGTON CHURCHILL: Thank you, Lieutenant Governor Rutherford. Our next speaker is a true advocate for the revitalization of Baltimore City. He represents Maryland's 46th District, including neighborhoods in Baltimore's downtown. Please join me in welcoming President of the Senate, Bill Ferguson. Mr. President.

BILL FERGUSON: Thank you, sir. Good afternoon. I'll just start with a little of an aside. I've been to a number of press conferences. But this was the first one that I realized that, Mr. Secretary, that the lieutenant governor of course, was the former secretary of DJS. And I just realized it's going to be an interesting feeling looking over your shoulder at all times having-- it's an interesting dynamic that I just now picked up on.

But look, it has led to today. And so obviously, not only is it working, it is working well. I'm so thankful to the secretary, to the lieutenant governor who knows these issues, and most importantly to the governor for stepping up at a time where our city and our region needed it most. I want to tell a quick story of how I think we got to this place.

And it started with a little Zoom meeting with Shelonda, and I see Marc Wasserman over there, and several others, individuals from the Downtown Partnership who care desperately about the health, and security, and livelihood, and energy of this place, of this space, the central business district of the city of Baltimore.

This is a place that for hundreds of years has been a beacon in the state of Maryland. About 75 years ago, everyone said the harbor was done, downtown was done. Never again would we see a downtown as vibrant as once was in the city of Baltimore. And some visionaries had some different ideas and said, you know what? If we make some public investments, we can renew the future. And that's what we did. And what we saw was the opening of Harborplace, we saw new construction happening in the private sector, and we saw a revitalization of this downtown core, this home of the state of Maryland for the last hundreds of years.

Well, in the middle of a pandemic, we faced a new challenge. We face a challenge where businesses are reevaluating what space do they need. Where do they need to locate? What does their future look like? And during this conversation with the Downtown Partnership, frankly, I was worried. I was concerned about what the future of the downtown business core would look like.

There was a request. Is there any chance the state could help lead the way? And I knew it was a long request. And I said, please put together some information. Help me to make the case. And the governor and I sat down and we sat in his office. And I was prepared. I had all the statistics ready. I had my briefer ready. And I said, Mr. Governor, I think we have a unique opportunity here. I think we have a chance with the influx of these federal dollars to use these federal funds to rethink and reimagine downtown Baltimore, to take a problem at state center that has been stuck, and just intractable, and use it as an opportunity to build new momentum for the future of this city and the following private investment that will come.

About halfway through my pitch, the governor stopped me. And he said, you don't need to say anything else. I get it. That's exactly right. We've wanted to move this. I've been pushing DGS. This is exactly right. This is an opportunity to use these funds as a stimulus for the city of Baltimore and this entire region. I didn't have to sell it. The governor knew right away. Two weeks later $50 million came down through in the supplemental budget that has led to this moment, and we will see two new agencies move to the downtown.

I want to say this is not just about buildings, though. While the buildings are important, and don't get me wrong, the buildings are very, very important, it is about the people. A city lives and dies on momentum. When you invest in the people, when you bring people to places like this place, that is what makes cities great. What we're able to be a part of today, and I want to thank, again, my partners in the administration, my friends in the House of Delegates, also Senator Hayes who has been a champion and continues to represent state senator as we will reimagine that space in the future.

But this is what the future looks like in a post pandemic environment. It's people solving problems to say, you know what? We're going to get through this. And when we do, we're going to create a brighter future. Thank you. Thank you for this day. Let's keep winning the day. Thank you, all.

ELLINGTON CHURCHILL: Thank you, President Ferguson. And I also thank the administration and the General Assembly for the $50 million that will assist with this process and move out. Our last speaker is Maryland's largest business center and cultural district leader. Please join me in welcoming the president and executive of the Downtown Partnership of Baltimore, Shelonda Stokes.

SHELONDA STOKES: Thank you, Secretary Churchill. This is an amazing day, for our city, for the CBD, for us all, Governor Hogan I cannot thank you enough, not only for your bold leadership that started in 2019 when you announced plans to relocate those 12 agencies to the central business district, but for today, your announcement. So thank you for that. Lieutenant Governor, thank you. You know we go way back. So I thank you and appreciate your leadership and partnership.

Senator Ferguson, I can't leave you out. Because those Zoom meetings meant a lot. I know your commitment to our city. Thank you. And Secretary Churchill, my brother, thank you. I mean, I am filled with thanks today for where we are. I also want to thank Mayor Scott and the Scott administration. I have to thank-- I know my board chair Marc Wasserman is here. Some of my team members are here. And I just have a few people because along this route, we did a lot of lobbying and advocacy with a number of people who listened, they helped advocate.

Hopefully they whispered in some ears and did some things. So I'd like to thank delegate McIntosh, Senator Hayes, Senator McCray, Delegate Lierman, Secretary Schultz, Secretary Churchill of course, Council President Mosby, Councilman Costello and Chief Legislative Officer, I see you in the back, Keiffer. I thank you for those days.

And today is beautiful not just because we're getting some good weather here but because of what Governor Hogan and Senate President Ferguson announced. I mean, this will help spark vitality, the vitality we needed into the CBD. It's located of course, in the business improvement district of Downtown Partnership. With our vacancy rate approaching nearly 24%, that's almost 2 million square feet. We know that COVID accelerated with business consolidation, office downsizing.

And so relocating state agencies into the CBD represents a crucial boost for the pandemic recovery that will not only catalyze stabilizing downtown and stimulating the economy, but it's also an easier move. You see, transitioning employees just a few blocks will keep approximately those 3,300 jobs that you mentioned in the city while fostering an additional 500 more ancillary service jobs. And as you mentioned, senate president, those aren't just numbers. Those are people. Those are citizens. Those are families who are positively impacting and pouring into our city.

Relocating state agencies into the CBD will create an integrated, transit rich, walkable complex with nearby amenities for state employees. And they'll be in good company with other agencies nearby. We have the University of Maryland medical and educational systems, the MTA, human resources, the stadium authority, and the Department of Commerce. In partnership with Mayor Scott's administration, the Baltimore Police Department, the Baltimore City School Police, and other state and federal public stakeholders, we're committed to increasing public safety we hear you. We recognize this.

And we're also working on some placemaking and business building initiatives to complement the move. Downtown Partnership recently launched our BOOST initiative, which stands for Black Owned and Operated Storefront Tenancy. This is an initiative to increase the number of minority restaurants and retailers within the district. We're also reimagining the CBD. We're doing new branding, more intentional placemaking, and transforming unused or underused spaces like alleys and lots to create them as gathering spaces with light and color and more community.

Bottom line, we value the commitment and partnership of the state to include Governor Hogan, of course, lieutenant governor, Senate President Ferguson, the presiding officers, legislators, and all who had a hand in helping make this happen. We need these state agencies here. And we value them. We will not take this for granted. We recognize there's no other area like the CBD in the state. And so this is an opportunity for the state, the city, and the business community to work together towards creating a safe walkable campus like environment filled with nearby art, culture, healthcare, tourism, restaurants, and entertainment, amenities for all of our state employees right here in the heart of our city. Thank you so much.

ELLINGTON CHURCHILL: Thank you. Ms. Stokes. And I do want to thank the governor, and our lieutenant governor, and President Ferguson for joining us here today and for their remarks. Before closing, it would be remiss not to mention how you can access these important solicitations for commercial office space. So there are a number of ways that interested commercial office owners and brokers can find the solicitations that are out now and will be out in the future.

As we mentioned, the Department of Human Services is out presently. Those that are interested should go to our state website eMaryland Marketplace Advantage. eMaryland Marketplace Advantage, otherwise known as EMMA. You can access the site through three different ways, by going to the General Services website, dgs.maryland.gov, and then clicking on the Procurement node.

You can also go to our website for the Office of State Procurement. And that procurement.maryland.gov. And our EMMA website is EMMA, E-M-M-A, .maryland.gov. Interested vendors, stakeholders, brokers should register on the eMaryland Marketplace Advantage website to get access to learn of this solicitation and others that are coming in the future. So that ends our announcement for today. And I thank everyone for attending. Thank you.

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