Commission explores Md.’s real and perceived business climate

ANNAPOLIS — Maryland’s business and economic development climate suffers from poor perception rather than actual underperformance, according to state officials.

Dominick Murray, secretary of the Department of Business and Economic Development, Wednesday told the Maryland Economic Development and Business Climate Commission that the perception that Virginia is outperforming Maryland is incorrect.

“The data will show that when people compare us to Virginia, we have a 17 percent growth rate,” Murray said, adding that the figure represents economic growth in Maryland over a four-year period ending this February, a rate he said exceeded that of Virginia’s.

Government officials, business leaders and residents in Maryland suffer from “pathological modesty,” Murray said. “We sometimes don’t remember all the good things we do. Like businesses, we have to focus on our competitive advantages.”

Wednesday’s hearing was the first for the 21-member panel created and appointed by House Speaker Michael E. Busch and Senate President Thomas V. Mike Miller Jr. The commission is charged with reviewing the overall economic development structure and incentive programs in the state and then making recommendations to the legislature late this year.

Norman Augustine, chairman of the commission, spoke of the recession and said he is concerned that some other states “are getting better faster than we are.”

“The question is, how do we compete?” asked Augustine, the former chairman and CEO of Lockheed Martin Corp. “Our task is not easy.”

The commission spent a large portion of the morning interviewing Murray as well as top officials from the Maryland Economic Development Corp. and the Maryland Technology Development Corp. and exploring how the three organizations work together.

Part of that focus for Del. John L. Bohanan Jr., D-St. Mary’s, a commission member, was the reduction of staff at DBED, which he noted was once as many as 400 employees.

Today, the staff is about 200, according to Murray.

The reductions led Bohanan to ask Murray if he felt the department would benefit from a larger budget.

“I don’t know a single secretary who wouldn’t say I need more money,” Murray said.

But Murray reiterated that the state suffered from a perception problem.

“It does take a long time to overcome a reputation,” Murray said. “If it’s that bad, why are we actually outperforming our neighbors?”

But Del. Wendell R. Beitzel, R-Washington and Allegany, a commission member, said the state business climate suffers from more than just a perception problem.

“I think it is more than perceived,” Beitzel said, adding that residents in Western Maryland live in a tourism and resource-driven economy. He noted the campaign from environmental groups and some state political figures to limit drilling for natural gas in Marcellus shale deposits in the counties he represents.

“There’s a feeling there’s real suppression by the state to operate or to do the things we’ve been accustomed to doing for some time,” Beitzel said.

Del. Dereck E. Davis, D-Prince George’s, a commission member, also disagreed with the assessment that Maryland’s business climate suffers only from poor public perception.

“It sounds like what a lot of what is being talked about is about money and tax credits and incentives,” Davis said, adding that he has heard complaints from companies who were unhappy with their attempts to move to the state.

“They are expecting one set of rules and halfway through the game the rules seem to change on them,” Davis said. “I don’t think the presiding officers would have created this commission if we didn’t have real challenges and real issues.”

The commission is expected to meet several more times throughout the summer and fall before delivering a final report and recommendations in December.

The report is expected to lead to legislative initiatives in the 2015 General Assembly session, according to Busch and Miller

“This is not going to be a commission where we ignore the recommendations,” said Miller

“We are going to use your recommendations as a road map,” Busch said.