Baltimore’s new tax deal with wealthy institutions falls short, activists say

A coalition of labor and grassroots organizations is blasting Baltimore’s new tax agreement with the city’s wealthiest institutions, calling it a “backroom” deal negotiated without community input.

The With Us For Us Coalition, which organized for months to push Baltimore’s largest tax-exempt anchor institutions to “pay their fair share” and has been pushing for a transparent renegotiation process, says Mayor Brandon Scott announced the five-year deal on October 1 before the passage of legislation that would have given workers and residents a seat at the table.

Under the new deal, the city’s 14 largest hospitals and universities will make voluntary payments for city services that will gradually rise from $6 million per year to $12 million by 2030 — still far short of what other cities receive from similar institutions.

“We’re disappointed by the fact that we weren’t included in this process,” said Leyla Adali, an organizer with the coalition. “Mayor Scott wants to ink this deal without community input, without creating the task force. But we’re also not super happy with that $12 million number either.”

City officials counter that the institutions are an economic engine for the city, employing 71,000 residents who generated over $57 million in income taxes. They also contribute $29 million in taxes and fees each year, along with $19 million for community safety, $7 million for waste management, and $2 million for public right-of-way maintenance.

But a 2024 report by City Comptroller Bill Henry found the “meds and eds,” a nickname for the city’s largest universities and hospitals, consume roughly $47 million in city services, including police, fire protection, and infrastructure maintenance, while paying $6 million under the current Payment in Lieu of Taxes agreement, which is set to expire next year.

The 14 institutions are: 

• Ascension St. Agnes Hospital
• Good Samaritan Hospital
• Grace Medical Center (formerly Bon Secours Hospital)
• Johns Hopkins Bayview Medical Center
• Johns Hopkins Hospital
• Johns Hopkins University
• Loyola University Maryland
• Maryland Institute College of Art
• MedStar Harbor Hospital
• MedStar Mercy Medical Center
• MedStar Union Memorial Hospital
• Notre Dame of Maryland University
• Sinai Hospital University of Maryland Medical Center Downtown Campus and University of Maryland Medical Center Midtown Campus

The same report estimated their property holdings — valued at more than $5 billion — would generate about $120 million a year if fully taxed.

Baltimore City has the highest property tax rate in the state of Maryland — more than double the state average — in part because of its high concentration of tax-exempt institutions.

Critics argue the new agreement, which would double payments over five years, still leaves a major gap. “The meds and eds use about $47 million annually,” Adali said. “Even with the increase, there will be between a $190 million and $205 million gap.”

The coalition had spent months building pressure for a more equitable agreement. In April, activists launched a campaign that included neighborhood canvassing and phone banking. City Councilmember Phylicia Porter introduced legislation in March that would create a 17-member task force including union workers, residents, and representatives of local hospitals, and members appointed by local elected officials to develop recommendations for future PILOT agreements.

That bill is now languishing in committee, and organizers say announcing the deal before the task force legislation was put to a vote undermines the push for transparency.

“Whether the payments are $6 million or $10 million or $12 million, if we don’t pass the bill, there’s still no community input,” Adali said. “One of the provisions of the bill that I think we thought was really important was that there would be annual reports published on the contributions so there would be that added transparency.”

The PILOT agreement signed in 2016 was similarly signed behind closed doors with no public involvement, critics say.

Scott framed the new agreement as a compromise that accounts for the financial strain institutions face from Trump administration cuts. Johns Hopkins has lost $800 million in federal grants since January, according to the mayor’s office.

But organizers note that unlike institutions with multi-billion dollar endowments, Baltimore has fewer options to fill budget gaps. The full effects of thousands of federal job losses and contract cuts have not yet been understood or felt. 

Meanwhile, Johns Hopkins has a $13 billion endowment that it already tapped into earlier this year to preserve research and protect staff affected by federal cuts.

“We completely recognize that these institutions are being targeted by the federal government,” Adali said. “But they do still have quite a bit of money. Regular Baltimore City taxpayers don’t get to avoid paying their taxes.”

The deal also compares unfavorably to agreements other cities have secured. New Haven negotiated $135 million over six years from Yale University alone — about $22.5 million annually from a single institution. Boston collects over $29 million annually from its eight largest institutions. Providence secured $223 million over 20 years from four universities.

“We have 14 institutions that are part of the PILOT agreement, and those 14 institutions collectively are not willing to pay the same amount of money as Yale pays to New Haven,” Adali said. The deal, she noted, allows the institutions to avoid higher payments despite their financial capacity.

With Us For Us says it will continue pushing for the task force legislation to ensure future negotiations include community voices.

“We see increased PILOT contributions from the meds and eds as an increased investment into the Baltimore community at a time when things are really, really hard for everyone,” Adali said.