Breaking Down the new Lakefront Library Plan

The proposed Lakefront Library has generated both enthusiastic support and understandable skepticism. This article provides context of the proposed $143 million Lakefront Library within the Downtown Columbia plan, describes the details of the land-swap agreement that would occur between Howard Hughes Corp and the County, analyzes why each party would do it, and adds my own commentary on why I hope it occurs and some solutions that the Council should consider as it reviews the FY24 Capital Budget. Phew!

The Downtown Columbia Master Plan

The Downtown Columbia Plan, adopted in 2010 and amended in 2016 by the County Council, creates a 30-year master plan for the revitalization and redevelopment of Downtown Columbia. The vision is that a reimagined Downtown will provide the county with a significantly expanded tax base, enhance quality of life for existing residents and attract newcomers looking for amenity-rich walkable bikeable communities, help Howard County compete for cutting edge industries and new jobs, and deliver 900 affordable housing units to ensure housing options exist in Downtown Columbia for all-income levels.

The plan permits Howard Hughes Corporation (HHC), as landowner of 391 acres of Downtown Columbia property and appointed master developer, to add 14 million square feet (sf) of new residential, retail, and office development on their properties. In total, the Downtown Plan calls for the addition of 6,250 residential units (900 affordable), 4.3 million sqft of office space, 1.25 million sqft of retail, and 640 hotel rooms. These are to be delivered in phases with minimum and maximums that must be adhered to prior to moving onto the next phase. Additionally, HHC is required to provide various community enhancements, programs and public amenities (CEPPA), most of which have already been delivered (e.g. Milley Bailey Park and the Wilde Lake to Downtown multi-use path).

As part of the plan, the County is set to deliver specific public amenities including a new public library central branch, an arts & cultural center, transit center, a fire station, and elementary school. The public and private investment are intended to work in tandem to attract new residents and businesses, thus spurring the economy and creating new sources on tax revenue on increasingly valuable real estate, while providing a variety of new housing options and the public infrastructure necessary to support growth.

The county elected to utilize Tax Increment Financing (TIF) to finance Downtown Columbia public infrastructure. TIF is a financing mechanism in which a municipality designates a specified TIF area, and can then borrow against taxes due from future gains in real estate value in that area to pay for infrastructure that enables real estate to appreciate in value. The idea is that the the infrastructure and/or public amenities funded via TIF will cause increases (and thus, more property tax revenue) to the other properties in the TIF district that wouldn't otherwise occur. TIF has already been used to finance roads and utility construction in the Merriweather District, and can be used to finance other public amenities and infrastructure planned for the future. By its nature, TIF financing can only be used for infrastructure in the designated TIF area, and cannot be used towards the county's operating budget or capital expenditures outside the TIF area.

Original Plan for Public Amenities and Affordable Housing

The 2016 amendment to the Downtown Columbia plan, the 2016 Development Rights and Responsibilities Agreement, was an agreement to add 900 affordable and moderate-income housing in Downtown Columbia by full buildout. Howard Hughes would intersperse 200 very-low income units, 200 middle income units, and 83 affordable live-where-you work units in all new residential projects as they come online (e.g., Juniper, Marlow, Lakefront North, and beyond). The County, via its Housing Commission, in facilitation with HHC (who is required to provide land for some of these sites), is slated to deliver the other 417 affordable housing units using federal low-income housing tax credits (LIHTC) as the funding source (no county funds are needed for the affordable housing component). The Columbia Downtown Housing Corporation was created specifically to fulfill the vision for the inclusion of these housing units in Downtown Columbia and monitor progress, and provide status updates and annual progress reports (available on their website, linked above).

The original intention was to combine a public amenity and LIHTC mixed-income housing into each of the following development projects:

• The New Cultural Center, including Artist Flats mixed-income housing (Note: An update on the NCC was provided at the 4/26 Council budget worksession. Given an increase in construction costs by ~30%, the NCC design is being revised to reduce its cost... more to follow in a separate article).

• New Central Library Site in the Merriweather District including mixed-income housing

• Existing Library Site – following relocation of the Central Library, the existing Central Library will be demolished and a realigned connector road and a mixed-income LIHTC project will be built on this site.

• Banneker Fire Station including 100% senior affordable housing

• Future Transit Center including a mixed-income LIHTC project to be located between the Columbia Mall ring road and Little Patuxent Parkway.

The New Lakefront Library Plan

On March 30, 2023, a new plan was announced for a stand-alone transformational public library at Columbia's Lakefront as well a new 240-unit mixed income affordable housing building in the Merriweather District. I'm sure you have heard about it.

The deal is essentially a land-swap involving three separate properties, described further below:

Lakefront Library Site - HHC owns this parcel that was the former site of the American Cities Building that is currently a surface parking lot. It's arguable the most important and valuable undeveloped site in Howard County given its location immediately adjacent to Columbia's central-most community gathering place - the Lakefront. HHC had intended to develop this site into a 15-story mixed-use building. Instead, HHC is offering to transfer the land to the County for the new library location. The county (using a combination of TIF, bond issuances, grants, state funding, philanthropic contributions, and other sources) would bear most of the costs. HHC would serve as developer to coordinate planning, permitting, approvals, and construction using the design concept they contracted and paid renowned architecture firm Heatherwick Studios $600,000 to create. Heatherwick is known globally for projects including the Vessel and Little Island in NYC, Google's campus in Mountain View, CA, and many other projects around the world.

Merriweather District Site - HHC also owns this parcel in the Southwest corner of the Merriweather District. Originally, under the DRRA, HHC would have transferred this land to the county for a new library with 120 mixed-income housing units above it. The new plan would still transfer the land to the County, but instead of using it for a combined library/housing development, the County, via the Housing Commission, would build a 240-unit mixed-income housing building without any other public amenities. At least half (a minimum of 120) would be affordable LIHTC units, twice the amount of affordable housing units originally planned for the site.

Current Library Site - Under the Downtown plan, the existing library central branch will be demolished to make way for a new offramp from US-29 into the Merriweather District and the realignment of Symphony Woods Road into a North-South Downtown connector road. Originally, after realigning the road, the remnants of the existing library site would have maintained by the county for one of the 5 LIHTC housing developments. But now, under the new plan, this parcel would transfer to HHC for their own future development.

I marked up the following map (which is from 2010 Downtown Columbia plan) describing this new plan.

The Cost

The total cost of the library project would be ~$143 million, broken down as followed:

• The Library building: $94M

• Site work and public parking: $38.5M

• Area and transportation improvements: $10.3M

The library would be funded as followed:

• Tax Incremental Financing: $80M (as explained above, this money cannot be used for other purposes outside Downtown Columbia)

• General Obligation County Bonds: $26M (this $$ could be spent on other purposes)

• Maryland State Funding: $20M (Gov. Wes Moore is fully committed to the project).

• Philanthropy Dollars: $10M

• Library-specific State grants: $6M

• Howard Hughes: ~$1M

What's in it for Whom

What's in for Howard County?

Residents would enjoy an outstanding new public space in the heart of Columbia that offers premier programming that the library does not currently have the space to offer. HCLS President & CEO Tonya Aikens has a visionary mindset to ensure HCLS remains on pace with the latest library trends that libraries across the country are now offering. Preliminary ideas from pre-pandemic and ongoing community feedback sessions include:

• More space for classes for all ages in order to decrease or eliminate waitlists

• Early childhood education, programming, and play-spaces for babies, toddlers, and preschoolers.

• Expanded classroom and tutoring space for Project Literacy and workforce development initiatives

• A literacy kitchen that builds on the success of similar kitchens in other libraries across the country (like one that exists in Carroll County)

• A dedicated space for teens

• A makerspace for all, including makers, small business owners, and entrepreneurs

• Community work and meeting spaces

• Flexible space for collaboration and community building

• Expand existing and successful special collections such as art, DIY and more

• Open-floorplan usable as an auditorium for author events

The alternative to a public library on this site is Howard Hughes keeping the property themselves and adding a 15-story mixed-use development looming over the Lakefront.

Residents would not only enjoy the amenities within a fabulous new indoor public space, but the tiered structured of the design concept creates multiple terraces of new public outdoor space that will integrate into CA's open space on the Columbia Lakefront while creating some killer new views and overlooks of Lake Kit.

An iconic library designed by a globally-known designer located at the civic heart of the community will help attract more residents, businesses and up to 1 million visitors a year to Columbia.

This is an investment in the future of Columbia and Howard County. It's not just an investment in all of us residents who the library will provide services, but also an investment projected to provide a substantial financial return to the county in the form of an expanded tax base (more on that in my commentary addressing common concerns below) that will enable the County to maintain and increase services to new and existing residents without increasing taxes.

The deal also enables the Merriweather site to be dedicated exclusively to affordable housing, which helps ensure Downtown Columbia, like the rest of the city, remains a purposely mixed-income community.

What's in it for Howard Hughes?

As master developer of Downtown Columbia, HHC will benefits from giving up the Lakefront site because it makes all their adjacent properties more valuable. At this point, HHC has developed only 20% of the 14 million sqft permitted in the downtown plan. They have A LOT more to build and a lot more space to lease. An iconic library designed by a globally-known designer located at the civic heart of the community will help attract more residents, businesses and up to 1 million visitors a year to Columbia. A desirable Columbia that allows all of us who live here to enjoy fulfilling lives benefits HHC's bottom-line. A vibrant Lakefront with increased foot-traffic benefits HHC's existing leaseholders and increases demand for all of HHC's current and future residential units and commercial space they have planned for Downtown Columbia, allowing them to command even higher rents. Further, the deliverance of this library and creation of the associated new affordable housing units in the Merriweather District allows HHC to advance to subsequent phases of Downtown Columbia development. Last, but certainly not least, HHC will receive the remaining portion of the current library site in exchange for the Lakefront location (other than the realigned road, which itself benefits HHC by improving vehicle accessibility to all its properties).

Addressing Concerns with the Lakefront Library

There are multiple issues causing concern about the proposed Lakefront Library. Below, I tackle of three of these concerns and offer potential solutions.

Cost

A common reaction I've seen on social media to the cost of the Lakefront library is that there much better uses for $143 million. I agree with this sentiment. If given a choice between spending $143m on a new library or spending it on renovating schools and adding new school capacity, like most parents, I'd choose schools in a heartbeat. But I don't see this as an either / or.

Downtown Columbia can be an economic engine for our county that will significantly expand our tax-base and generate new revenue that would not otherwise occur. It's easy to envision how an iconic worldclass library can serve as a catalyst for economic growth and a magnet drawing new residents and businesses and even tourists/visitors (and their tax dollars) to Howard County. The Lakefront Library can be an investment that will generate returns both to current and future residents who will benefit from the services it provides, as well as to the County's balance sheet. The cumulative positive fiscal impacts for Howard County associated with the redevelopment of downtown Columbia will total $389-$511 million between 2020 and 2048 once one accounts for the cost of local government services and debt service associated with tax increment financing, according to a 2019 fiscal analysis by the Sage Policy group. The County itself prepares 30-year projections of the revenues and debt-service expenses to finance its capital projects - a fire station, library, arts center, traffic improvement, transit center, and schools. The last such "waterfall table" I could find (from November 2020) shows that even after funding all these projects, the county would have a surplus of $379 million at the end of the analysis period.

Updated projections are needed to assess the increased construction costs and new property tax revenue under the revised Lakefront Library plan. Construction costs have increased 30% to 35% over the past 2 years due to inflation and building supply costs. Likewise, property tax revenue has also increased since property assessments are based on the revenue a commercial property generates, so higher rents means higher assessments. If I were assessing whether the county should invest in a new Lakefront Library, I'd start by looking at updated long-term revenue and cost projections for Downtown Columbia under this revised plan using the most up to date data inputs to assess whether, after serving debt payments to build the library, enough revenue remains to fund the remaining capital projects called for in the Downtown plan while still providing the projected revenue surplus.

School Capacity

One of the capital projects that new Downtown Columbia property tax revenue is earmarked to finance is an elementary school servicing Downtown Columbia. The 2020 HCPSS Feasibility Study recommended that a new elementary school should be added to the Downtown Columbia area by 2028-29, but funding a new Downtown Elementary school has completely dropped off the list of future capital projects in the recently submitted FY24 HCPSS Capital Budget request, One reason for that is because actual student yield in the Downtown Columbia area has generated fewer new students than once predicted. The 1,199 Downtown Columbia housing units built to date (those by the Mall and in Juniper in the Merriweather District) have generated 0.03 students per unit, whereas it was once predicted they would generate five times as many. However, these already built units are predominantly market-rate studios and 1 bedrooms, so the low student yield should not be unexpected. As more affordable housing units come online in the Downtown Columbia area, higher student yields should occur that are more in line with original projections. And anecdotally, as a homeowner in a Columbia neighborhood in close proximity to Downtown myself, I'm seeing more and more young families with kids buying resale houses for the same reason my family did when we moved here in 2019 - because being in a single family home in close proximity to Downtown Columbia is attractive to families able to afford it. Downtown Columbia will lead to more students in HCPSS schools, even if those students are not living directly in new HHC residential buildings. So, school capacity will certainly be needed as Downtown Columbia's build out continues.

Of note is that the County is already doing one important thing that will address school capacity in Downtown Columbia. On May 4, County Executive Calvin Ball announced Faulkner Ridge Center in Wilde Lake will be renovated into a new 260-seat regional universal Pre-K. This is a big deal. Preschool helps set the foundation for lifelong learning and achievement and its thrilling to see the county invest in this building to as part of a plan to fully implement the State-mandated Blueprint for Maryland’s Future. Not only will this investment make public preschool attainable for more young learners in the County, it will also help provide more capacity at the elementary level, since the school space that nearby elementary schools dedicate to preschool classes will now become available for K-5 instruction.

But, additional elementary school capacity will be needed. TIF revenue provides a unique funding opportunity that could be used to add school capacity in the Downtown Columbia area using a funding source that can't be utilized anywhere else in the County. The plan all along has been to use TIF to finance a new elementary school in Downtown Columbia are and I want to ensure our county, after issuing TIF bonds for a new Library, is still situation to take advantage of this opportunity to add this promised school capacity. The school board, council, and county executive should collaborate to identify the best option to add elementary school capacity using TIF revenue. 2022 BOE candidate and fellow Bryant Woods parent Julie Hotopp has been advocating to use TIF to provide a full replacement and expansion of Bryant Woods Elementary. Other options include building a new elementary school in either Hawthorn or Clary's Forest on land that HHC has contributed, as one of their required CEPPAs, to the the HCPSS landbank for this purpose.

Parking

The Lakefront library would be built on top of a new $38.5 million 500-space public parking garage. This new free parking garage would more than double the amount of spaces currently on this site. As a free public lot, it would not only provide parking for the library, but would also be used by visitors to the Lakefront and patrons of the nearby businesses (Whole Foods, The Collective, The 3rd, Sushi Sono, The Pearl, etc.) that lease space in HHC buildings. I think it's a safe assumption that if and when the Lakefront library is built, HHC would turn its attention to developing the parcel immediately to the north on Wincopin Circle, demolishing the 2-story parking structure that currently exists there to make way for another new development, further depleting parking in the Lakefront area. Because this new Lakefront library parking structure would also be used by patrons of HHC tenants, and because HHC is already providing parking on its properties for this purpose, I think HHC should be contributing a reasonable portion of the investment needed to build the $38.5 million parking structure. County taxpayers should not bear the entirety of this cost.

Conclusion

I want to see this Lakefront Library move forward with the Heatherwick design and I hope the County Council approves a Capital Budget that allows it to happen. But, I also believe that the County should extract as much benefit and shift as much risk to HHC as possible. Prior to approval, I think that the Council should:

• Ensure that updated financial projections of Downtown Columbia's future revenue and expenditures support the public investment needed for the Lakefront Library and all other planned capitol projects. Ensure HHC assumes risk that if property taxes fall short, then they would be responsible to pay a special assessment to make up the difference.

• Begin the process to develop a plan to use TIF revenue to also add new school capacity in Downtown Columbia.

• Require HHC to contribute to the cost to build the $38M parking structure below the Library since it will also be used by patrons of tenants in their nearby buildings.