Center Maryland: Will business climate issues have traction in post-election Annapolis?

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Column originally published by Center Maryland on May 23, 2014

By Donald C. Fry

After years of advocacy from private-sector leaders, the issue of strengthening Maryland’s competitiveness for business growth and job creation appears to be gaining traction in Annapolis and with candidates in the 2014 elections.

Last year the Maryland General Assembly passed legislation that had been long sought by the Greater Baltimore Committee and transportation advocates to increase funding for roads, bridges and transit to address the acute and escalating erosion of available funding for transportation infrastructure.

This year, the General Assembly passed a first-ever joint legislative agenda for economic growth and job creation championed by Senate President Mike Miller and House Speaker Michael Busch.

And all of the candidates for governor this year are citing strengthening the state’s business climate as a top priority in their campaigns.

Are these early signs of a fresh appreciation among Maryland’s policymakers that a fundamental prerequisite for a strong economy and job generation is a competitive business climate?

Possibly.  Private-sector leaders, particularly at the Greater Baltimore Committee – which yesterday focused on the issue of competitiveness at its annual meeting – are keeping their fingers crossed.

More than three years ago business and civic leaders at the GBC decided to tackle what they saw as one of Maryland’s toughest public policy challenges – a growing disconnect between the private sector and elected leaders over the issue of business climate.

The disconnect centers around one key factor – many elected policymakers in Maryland were failing to recognize that the state’s significant strengths – including superior education, savvy workforce, research and technology, and a high quality of life – are not enough by themselves to remain competitive in today’s economy.

Meanwhile, Maryland found itself emerging from the Great Recession with an outdated fiscal tool kit, including a tax structure that is a half-century old and a transportation funding framework that hadn’t been significantly replenished in two decades.

The state’s business climate suffered from policymaking that was stuck in neutral when Maryland desperately needed visionary policy reform to catapult our state forward as the strong competitor for business investment and job growth that we need to be.

The GBC issued two reports, one in December 2010 that detailed eight core pillars for a competitive business climate; and another – developed last year at the GBC’s Chesapeake Conference of CEOs – that recommended a “To Do” list of priorities to strengthen Maryland’s competitiveness.

 

Conference participants agreed that the overall objective should be to develop a shared strategy for competitiveness endorsed by both business and government leaders.  Tax and spending reform was identified as the top tactical priority on the “To Do” list by an overwhelming majority of business leaders who participated in the day-long GBC conference.

Additional priorities include crafting a 10-year strategic plan for transportation, investing in the port and airport resources, implementing regulatory reform, and deploying a coordinated STEM strategy throughout the state’s K-12 and higher education systems.

Priorities also include investing in resources to nurture innovation and entrepreneurship, strengthening the state’s economic development programs, implementing outcome-driven accountability in K-12 education, and leveraging business partnerships for infrastructure development.

My point is, even as our elected leaders are signaling a new appreciation for the value of a competitive business climate, there is much to be done.

This fall, a private-sector GBC commission, which has spent the last seven months tackling the issue of tax and spending reform, will issue recommendations for restructuring Maryland’s tax system in a revenue-neutral way that would make Maryland more competitive, yet position the state for revenue growth that would not stifle job generation. The commission will also make recommendations regarding the state’s spending process.

It goes without saying that tax reform and other priorities for competitiveness will require strong private-sector advocacy and reinforcement during, and especially after, the election process.

It’s important to Maryland’s future that, whoever emerges from the upcoming elections, they and private-sector advocates agree on a fundamental reality that elected leaders in Maryland have struggled in the past to grasp: when it comes to a competitive business climate, policy matters.

don fry commentary squareDonald C. Fry is president and CEO of the Greater Baltimore Committee. He is a regular contributor to Center Maryland.    

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