By Anjali Shastry
ANNAPOLIS (Feb. 13, 2015)—A state commission recommended Thursday that Maryland lawmakers create a Cabinet-level position to oversee state agencies connected to commerce and change the perception that Maryland is unfriendly to businesses.
This new Secretary of Commerce probably wouldn’t head an entirely separate department, but instead oversee state agencies, such as the Department of Business and Economic Development and the Maryland Technology Development Corporation, to foster interagency cooperation when it comes to business development, House Speaker Michael E. Busch, D-Anne Arundel, said.
The Maryland Economic Development and Business Climate Commission also recommended that state agencies ensure businesses can find a streamlined process to set up shop here, and their study included a legislative package of five bills and 32 recommendations.
“It’s going to be a tough haul,” Norman R. Augustine, the chair of the committee, said. “I see the leaders in the legislature and the governor have come together with the business community and people want to listen to us. ... We’re in the crossroads ... I’m an optimist.”
One of the issues with Maryland’s economy is that too many businesses in the metropolitan area are dependent on the federal government, the commission found.
It should be a balancing act, Augustine said, because Maryland is first in the country for research and development, but more of that research ought to make it into the private sector to create businesses.
The commission also recommended the state put resources into a “newly designed” Maryland Economic Development Commission.
Based on the commission’s recommendations, the Senate and House of Delegates leadership will introduce bills to: train state employees in customer service; create an advisory panel that will include private sector stakeholders; create a technology transfer task force to move technology from higher education and research into the marketplace; and set up a pilot apprenticeship program to create workforce opportunities for young people.
Busch and State Senate President Thomas V. “Mike” Miller Jr., D-Calvert, Charles and Prince George’s, said they fully supported the findings.
“This hardworking commission of legislators and laypeople and business people … came together to fashion the 30 recommendations in this report, which I read last night and I could find no fault with any single one of the recommendations,” Miller said.
Republican Gov. Larry Hogan said in a released statement that he also supported the commission.
“I am thankful to Senate President Miller and Speaker Busch for initiating this important work, and our administration will be an enthusiastic partner when considering legislation and other actions to make Maryland more competitive,” Hogan said. “This is exactly the right conversation we should be having to transform the state's business climate.”
Hogan has announced plans to create a tax exemption on the first $10,000 in personal property for businesses, which he said would “entirely (eliminate) this tax for more than 70,000 small business owners—or one-half of all Maryland’s businesses.”
Democrats disagreed with his proposed tax breaks, but Augustine said the bills and recommendations presented Thursday didn’t have much to do with taxes because the committee hasn’t discussed them.
But Senate Minority Leader Nicholaus Kipke, R-Anne Arundel, said Democratic leaders’ support for business-friendly initiatives was a good sign for Hogan’s tax breaks for businesses.
“Now we have an opportunity to look at what we can do better and this is the first step where Democrats and Republicans can actually do that under the governor’s leadership,” Kipke said.
One of the commission’s recommendations read: “Expedite the implementation of plans to upgrade transportation infrastructure of all types in the Baltimore/Washington area.”
The commission did not make a recommendation regarding the contentious red and purple rail lines. Hogan has indicated he supports funding highways over the mass transit projects, though he has left some funding in place for the rail lines.
“The only thing we know, the citizens of this state waste thousands of hours sitting in their cars going to work and coming home and if you’re thinking of setting up a business here or thinking of taking a job here, particularly in the Washington metropolitan area, it’s a huge impediment,” Augustine said.
The commission was put together in March by Miller and Busch.
“Some of the things we proposed require money. And at this point, we’ve not tried to say where those funds should come from,” Augustine said.
All of the bills recommended by the commission will be cross-filed in the House and Senate, Busch said.
The bicameral commission is more popularly known as the “Augustine commission,” named for its chair, who is a former under secretary of the Army and former Lockheed Martin CEO.
“We met once every month, sometimes twice a month, from April when the commission was put together to December around various places in Maryland,” Chair of the House Economic Matters Committee Dereck E. Davis, D-Prince George’s, said.
“Hagerstown, Pax River, UMBC, Prince George’s, you know. We talked to local businesses and the problems they encountered.”
Commission members didn’t take a stance on Hogan’s grim view of Maryland’s economy, delivered Feb. 4 as part of his State of the State address.
“High taxes, over-regulation, and an anti-business attitude are clearly the cause of our economic problems,” Hogan said in his speech. “Our economy is floundering, and too many Marylanders have been struggling, just to get by.”
Bipartisan agreement on the commission’s business initiatives came seven days after state Democrats widely characterized Hogan’s address as a stump speech.
“See how far we’ve come in a week,” Busch joked.