City moves to reclaim conduit work, raises proposed lease rate to $4.05/linear foot amid affordability concerns

The Baltimore City Department of Transportation asked the Board of Estimates to approve a proposed increase in the city's conduit occupancy rate from $2.20 per linear foot to $4.05 per linear foot, effective Jan. 1, 2027, with future adjustments tied to the consumer price index. Director Veronica Macbeth said the adjustment is needed to fund proactive manhole replacements, deploy automated sensor monitoring for manhole fire risk, expand obstruction repairs and accelerate capital rehabilitation across the roughly century-old conduit network.

Macbeth laid out a funding rationale: the city previously had a capital agreement with Baltimore Gas and Electric (BGE) that provided $30,000,000 annually in capital investment through 2023, but the DOT said a per-linear-foot lease provides a stable, long-term funding stream and allows the city to control procurement and contracting standards. "The proposed adjustment to $4.05 per linear foot coupled with an annual consumer price index adjustment will provide a sustainable funding model that preserves this valuable public asset," Macbeth said.

Fire Department Chief Wallace described operational challenges from underground conduit fires and said proactive investments—including enlarged manholes, sensors and specialized suppression equipment—would improve responder safety. Deputy Mayor Khalil Zayed and council members stressed that inflation and rising materials costs require increased funding to address deferred maintenance.

BGE's Britney Jones, vice president of government and external affairs, opposed the rate hike as proposed and warned it would be passed to customers. Jones said much of BGE's profits are reinvested into infrastructure and estimated the fee change could increase average bills by about $1–$2 under some constructs; she also noted a scenario where, if costs were borne only by Baltimore residents, the impact could be around $10 per month for the average customer. "Our customers are struggling to pay their current bills," Jones said, adding the Public Service Commission (PSC) will determine whether and how any passthrough occurs.

Board members pressed DOT on how the rate compares to prior agreements, minority- and women-owned business goals under city contracting, and the operational impacts of restoring city control. After extended discussion, the board approved the rate framework and directed staff to proceed with implementation steps. The board and DOT noted that any change in retail electric rates is subject to PSC review and that the ultimate structure of how costs are recovered across BGE's customer base is not within the BOE's control.