State high-tech funding draws tough questioning

January 23, 1991|By David Conn | David Conn,Annapolis Bureau of The Sun

ANNAPOLIS -- State and private-sector economic-development officials, pressing for more state funding for high-technology initiatives, came under withering fire yesterday from legislators who questioned everything from the viability of new technologies to the state's ability to manage multimillion-dollar projects.

The questioning from members of the Senate Budget and Taxation Committee, which ultimately must vote on whether to fund some of the proposed projects, grew hostile at times as witnesses were asked repeatedly to justify spending money on projects that directly will help private companies.

Nonetheless, Economic and Employment Development Secretary J. Randall Evans said after the hearing that he saw signs the proposals could be changed to satisfy the committee.

"I think the committee members . . . in their questions gave us important hints about how we ought to structure the proposals," he said. In particular, the senators showed they wanted some assurance that companies receiving aid from the state ultimately would pay back the investment in one way or another.

Two projects in particular were on the front burner yesterday. Members of the Greater Baltimore Committee and the Montgomery County High Technology Council joined Mr. Evans in asking the committee to retain in Gov. William Donald Schaefer's budget some $3 million next year for the two projects and similar amounts in later years.

The projects are the Maryland Information Technology Center, which would provide facilities and services to developing companies working on digital communications technologies; and the Maryland Bioprocessing Facility, a $17 million-to-$20 million project that would provide space and specialized equipment to help small biotechnology companies move from the research to the manufacturing stage. The Maryland Information Technology Center may be planned for the Silver Spring area, and the Maryland Bioprocessing Facility will be in Baltimore.

Mr. Schaefer also reportedly will request an additional $1.8 million in his capital budget to help fund the Christopher Columbus Center for Marine Research and Discovery, to be situated in Baltimore's Inner Harbor area.

The development officials came to the committee pledging to shift Maryland's high-tech focus from pure research to commercially viable production through an emphasis on technology transfer.

"That's where the jobs and the tax base and the economic development that we all seek are going to come from," said Thomas Chmura, director of economic development for the Greater Baltimore Committee.

Walter Plosila, president of the Montgomery County Hi-Tech Council, said Maryland ranks only in the 20s among all states for funding high-tech initiatives, with about $10 million spent last year.

He and Mr. Chmura received strong signals, however, that their timing may not be ideal. "I really do not believe that you should be here for public funds when we have the

[budget] restraints we have," said Sen. Julian L. Lapides, D-Baltimore. "Indeed, you'd be the first ones, when we talk about increasing corporate taxes, to come running to us crying foul.

"How can you justify public expenditures on what is basically a private-enterprise facility?" Mr. Lapides demanded, emphasizing that he has little confidence in the ability of state officials to oversee complex projects.

Mr. Evans, acknowledging Mr. Lapides' lack of support, responded that some areas are worth investing in, even during times of budget restraints.

Some legislators were particularly upset that the facilities provided things of value to the prospective users without guaranteeing anything in return for Maryland.

"It seems an awfully good deal for the [company owner] and an awfully bad deal for the state," said Sen. Thomas M. Yeager, D-Howard.

Mr. Lapides added, "We're the landlord, and they're making all the profits."

More specifically, Sen. John A. Cade, R-Anne Arundel, said, "The least we can do, since we're providing all this high-priced equipment, is to extract an agreement to protect the state . . . so you don't have a situation where the entrepreneur comes in, uses the equipment, develops something and leaves the state."

Mr. Evans and the others assured the senators that such an agreement could be worked out.

The budget committee will address the same issues later in the session after the governor's budget is released.

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