To keep financial giant Legg Mason within Baltimore City limits, the president of the Baltimore Development Corp. introduced a bill before the City Council Monday that would enable Harbor East developers H&S Properties Development Corporation and Struever Bros. Eccles Rouse to forgo paying 95 percent of real property taxes to the city for up to 25 years.

Harbor East is estimated to cost $518 million. The bill would provide for a 15-year tax deferral on the project’s office building and a 25-year deferral on the underwater parking garage. In addition, the city would provide a $2.9 million infrastructure grant for public utilities and a promenade.

“We did extensive due diligence in arriving at the decision to seek the PILOT [payment in lieu of taxes],” said BDC President Jay Brodie. “We wanted to keep [Legg Mason] in the city. The developers could not have done this deal without city assistance, and this project will keep 600 jobs in the city and bring 500 more from Owings Mills, and the average salary of a Legg Mason employee is $111,000.”

According to the BDC, nearly 22 percent of Legg Mason employees live in Baltimore City.

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The developers also plan to lure other office tenants to the project to create 523 jobs paying an average $75,000 a year, of which they estimate 20 percent will go to city residents. They also expect 70 percent of hotel jobs, at an average $25,000 a year, and retail jobs, at $10 per hour, to go to city residents, for a total of 1,885 jobs of which 494 are expected to be filled by city residents.

Brodie said that “this is new money to the city. Currently the site is not generating any money in taxes to the city at all.”

“Even with the PILOT the city can still expect to see close to $10 million in city taxes by 2012, three years after the project is complete, and by 2036, $162 million,” said Irene Van Sant, project analysis director for the BDC. “This deal is not going to enrich the developers; it will help them get the deal done.”

Once the bill is introduced it will then go to the council’s Taxation and Finance Committee, chaired by Councilwoman Helen Holton.

“When you bring people into Baltimore to work, I think it does add value to the city,” Holton said. “I still have questions about the project, but without [PILOT] you’ve got nothing.”

Examiner researcher John Davisson contributed to this story.

rchappelle@baltimoreexaminer.com