Cathy explains it all: Baltimore City officials continue to haggle over the conduit system– but what does it really mean?

By Catherine Pugh,
Special to the AFRO

In an October 2022 interview with the AFRO- American Newspapers, Mayor Brandon Scott told Ralph Moore that Baltimore City was not selling its conduit system. And it has not. 

“No,” he said. “What I have before the board is a study to determine what is best for the city. The city loses money every year on the conduits.  I am asking to have an outside source tell us what is best for the city: sell the conduit? Lease it? Enter into a long-term lease or some other kind of partnership agreement?  The fact is that we cannot afford to continue to pay for the cost of the upkeep of the system.” 

“If, for example, the city raises the rates for BGE (Baltimore Gas and Electric) to continue its lease agreement on our system, what do you think will happen to that rate increase,” Mayor Scott asked Ralph Moore?  

Moore replied, “it gets passed on to the customer.” 

“You’re right,” said the Mayor. “I believe we are losing $4-7 million dollars a year,” an estimate similarly made by Moore.

The conduit system, which is 741 miles long, began operation in Baltimore City in 1898. It contains electric, telephone and fiber optic cables.  

Underground piping allows for telephone, electricity, internet, and cable systems to flow to residents and businesses throughout the city. BGE is the largest user of the conduit system at 76 percent.  

A charter amendment passed by Baltimore City voters during the 2022 election prohibits the city from selling its conduit system.

A meeting was recently held to work out repairs and ownership of the system.

The Feb. 15th agreement that was made –without the presence of City Council President Nick Mosby and Comptroller Bill Henry–was not a sale of the conduit system, but rather, an agreement with the Baltimore Gas and Electric Company to provide maintenance for the more than 100 plus years-old system. 

In the agreement with the three members of the Board, Mayor Brandon Scott, the acting city solicitor and public works director, BGE agreed to pay $134 million for capital improvements to the conduit system over the next four years.  They will also pay an occupancy fee of $1.5 million each year. 

If BGE does not spend the entire amount of $134 million on improvements to the city’s conduit system, according to the agreement, BGE will provide the city with the unspent sum at the end of the 4-year contract.

The last agreement BGE entered into with the city regarding the leasing of the conduit system was finalized in late November of 2016, when BGE–after lawsuits–agreed to pay the city $24 million dollars annually.  

The original request by the city was first set at a $30 million annual rate fee. The current agreement with BGE and Baltimore City ended in 2022.

The new agreement could result in $140 million dollars being received by Baltimore City in repairs and leasing fees over a four year period.

Neither Council President Mosby and Comptroller Henry  entered the Board of Estimate Chambers on February 15^th at 9 a.m. intentionally. 

Henry sent the following statement to AFRO reporter, Tashi McQueen, when asked about the meeting:

“First of all, I did not walk out of the BOE meeting; there was no meeting because I was never there. On February 15th, President Mosby and I purposefully did not enter the Board of Estimates chambers at 9am. We made this decision to intentionally deny the other members of the Board the additional members necessary for quorum, as defined in the BOE Rules. Instead, the Clerk read our joint statement to all present – explaining our position – and then left. Without quorum, the BOE was not able to hold its scheduled meeting that day.”

Henry called the Scott’s meeting with the acting city solicitor and the director of public works “an unsuccessful attempt to vote solely on the BGE agreement” so that “the Administration could assert that the item had been approved, when in fact, those members were not capable of legally conducting business.”

Henry asserts that during the meeting, held in his absence, “no opening statement was read, no effort was made to call for a vote on the routine agenda (nor for any other items on the non-routine agenda), nor were any protests or statements of opposition noted or public comment permitted – all of which would have happened at an actual meeting of the BOE, as is required by the Rules & Regulations of the Board.”

“Given that no meeting occurred, the agreement with BGE has not yet actually been approved,” his statement continued. “All items on the February 15th BOE agenda are being moved to the March 1, 2023 meeting agenda. The March 1st agenda will be distributed and posted publicly on the Comptroller’s website on Wednesday, February 22nd, by close of business.”

Mayor Brandon Scott recently issued a statement defending his decision to move forward with the Board of Estimates Meeting and approval of the BGE Agreement. 

“The approval  of the BGE agreement was valid and in compliance with the board’s rules,” said Mayor Scott.  “The attempt by Henry and Mosby to prevent the vote from happening violated at least six board rules. Their actions,” he went on to say, “violated rules about canceling a meeting, deferring a contract, abstaining from a vote, substitutes for absent board members and the number of meetings that the Board of Estimates is required to have each month.” 

Going into detail Mayor Scott gave examples of how President Moby and Comptroller Henry were in violation.

“The rules,” Mayor Scott, said explain that “The Council President may cancel any meeting with the concurrence of a majority of Board Members.”  Moreover, he quotes, “the rule requires that any cancellation notice be provided 24 hours prior to a meeting and be posted on both the City Council and the Comptroller’s websites.  This never happened.  Therefore, the meeting was not canceled,” said Mayor Scott. 

Mayor Scott defended the vote on the BGE contract saying that he was clear with the Council President and Comptroller and the members of the city council , “that BGE had needed approval of the agreement with the city before their submission of a rate hike on February 17^th, otherwise,” says the Mayor, “BGE would not have entered into the agreement.”

The Mayor also pointed out that the rules of the Board of Estimates require them to meet twice monthly unless a recess is announced at a prior hearing.  “By attempting to cancel or postpone the February 15^th meeting to March 2023, without announcing a recess at a prior meeting, the Council President and Comptroller would have caused the BOE to fail to meet a second time in February,” said Mayor Scott. 

The question of whether Baltimore City should sell, lease or enter into a partnership with another company like BGE remains unanswered.

Voters already cemented the fact that the city cannot sell its conduit system, however, it does not prevent the city from entering into partnerships with private entities.

Cities throughout the country are forfeiting maintenance fees by selling their conduit system for free, long-term city services– including for fire and police departments. Other areas are also entering long-term partnerships that relieve cities of the cost of upgrading systems to manage the rapidly growing technology industry.

West Des Moines, Iowa entered  a public private partnership to build conduit connecting every home and business with Google Fiber and improving options for its residents and business owners.

The Board of Estimates meetings are streamed live on Charm TV  Channel 25 and posted after on Charm TV’s YouTube channel.  

Lingering thought: 

In 1972, Baltimore City sold Friendship International Airport to the state of Maryland for $36 million and later that year it was named Baltimore/Washington International Airport.  It was renamed again in October 2005 in honor of Supreme Court Justice Thurgood Marshall.  What if Baltimore City had leased the airport to the state of Maryland maintaining ownership…would it be today to Baltimore City what Atlanta and other city airports are to their cities in terms of revenue?

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