5 economic issues MD should confront this legislative session

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As its General Assembly convenes, Maryland enters this session under economic pressure.

In 2025, the Baltimore region, the state’s largest economic footprint, experienced a slowdown. Regional GDP growth hovered around 0.2%, placing the region near the bottom nationally. Job growth softened to roughly 0.5%, with declines concentrated in government and key middle-class sectors, including manufacturing and transportation. Labor force growth only recently began to stabilize.

When growth is constrained, policy choices carry more weight. States that perform well in these moments are disciplined about both what they advance and what they avoid.

The most important economic question this session is not whether the state has strong assets. It’s whether state policy is keeping pace with how economic decisions are made and whether Maryland is organized around a clear economic direction in an increasingly selective capital environment.

Across Maryland, businesses are navigating the same fundamentals. From small businesses in Frederick to expanding firms in Prince George’s County and startups in Towson, success depends on access to capital, decision-maker confidence, and a viable growth environment.

Here are five issues to guide how Maryland talks about its economy, evaluates policy proposals, and decides what to advance and what to dismiss this year.

Closing the gap between policy and business decisions

Capital moves faster than policy. States that compete effectively are those that narrow the distance between how policy is designed and how businesses make decisions.

This session presents an opportunity to better align incentives, timelines and regulatory approaches with the realities companies face when deciding where to invest, hire and expand. When that gap narrows, confidence grows. When it widens, capital looks elsewhere.

Equally important, this moment calls for discipline. Policies that add costs, uncertainty, or friction onto industries Maryland is trying to grow should be carefully reconsidered, as misalignment works against growth.

Modernizing financing tools for today’s scale of projects

Maryland is seeing renewed interest in large, complex projects that can reshape local and regional economies. The recent announcement that Sphere is expanding to National Harbor is one example. Similar opportunities exist across the state in infrastructure, logistics, advanced manufacturing, entertainment and large mixed-use development.

Too often, the constraint is not demand or vision, but whether financing tools are flexible and robust enough to support projects of this size and complexity. Modernizing tools such as tax increment financing, district-based reinvestment mechanisms and public-private financing structures is essential to compete for transformative investment.

Demonstrating the ability to execute complex initiatives

Large projects matter not only for their direct economic impact, but for what they signal.

States build credibility when they show they can move complex initiatives from concept to completion across jurisdictions, agencies and funding sources. That credibility shapes how investors, lenders and site selectors assess future opportunities.

Decisions around governance, authority and coordination shape whether major initiatives such as downtown reinvestment, convention and tourism assets, port and logistics development and cultural and sporting anchors advance at the market’s expected pace.

Treating transportation and infrastructure as core economic policy

Transportation and infrastructure are not secondary considerations. They determine how people access jobs, businesses reach customers and regions connect to opportunity.

Advancing transit solutions, including implementation of the BMore Bus Plan, enabling transit-oriented development and sustaining momentum on major investments such as the rebuilding of the Key Bridge, completion of the Frederick Douglass Tunnel and modernization of Baltimore’s Penn Station are essential to how Maryland works as an economy. These are statewide priorities, not regional asks.

These investments strengthen connections between Baltimore and Washington, improve reliability along the Northeast Corridor, and support transit-oriented development around major stations that link housing, jobs, and growth.

Connecting innovation, startups and workforce to growth

Maryland’s long-term growth depends on its ability to turn ideas into companies and companies into employers.

That requires stronger alignment between startups, capital, workforce development and place-based investment. Efforts to accelerate entrepreneurship, support commercialization and compete for federal innovation opportunities are not side strategies. They are core economic infrastructure.

This understanding is reinforced through engagement with national and global peers, where regions compare what is working, what is not, and how innovation ecosystems succeed at scale.

A shaped opportunity and a lasting test

What makes this moment different is that the distance between policymaking and business decision-making is shrinking.

That is not automatic. It’s a shaped opportunity created by better information, stronger coordination and a clearer understanding of how the economy functions.

Years from now, this legislative session will not be judged by the number of bills passed or plans released but by whether Maryland aligned around these core issues, avoided counterproductive signals and created conditions where businesses could invest confidently and regions could execute at scale.

That is the challenge before the state this session and one future generations will hold us accountable for.

Mark Anthony Thomas is president and CEO of the Greater Baltimore Committee and serves on the Board of Directors of the International Economic Development Council.