Spend it now, Schaefer tells agencies Capital projects get speed-up orders to jolt state economy.

November 01, 1991|By William Thompson | William Thompson,Evening Sun Staff Reporters Jon Morgan and Marina Sarris contributed to this story.

Gov. William Donald Schaefer says the slogan "stop crying and start sweating" explains his plan to put some life back into Maryland's wobbly economy.

But the slogan just as well could be "stop crying and start spending."

In an effort to rebuild confidence in the state's economy and keep construction firms busy, Schaefer said yesterday that he is ordering department heads to identify state building projects that can be moved ahead early.

At the same time, he urged local governments and private industry to follow his example -- spend now what you were going to spend later.

The announcement surprised almost everyone, including the officials who are expected to carry out the order.

"We're going to do our part to stimulate the economy and move forward as fast as we can," Schaefer said.

Schaefer dubbed the plan "Maryland Goes to Work" and said it would affect an as-yet-undetermined number of projects in the state's $330 million capital budget as well as numerous highway construction projects.

He said contracts for such capital projects will be speeded up partly to help construction companies, which have been hard hit by the recession.

"Part of it will be psychological," Schaefer said of the economic plan. "A lot of them are right on the brink of no work."

The normal contract process "can take anywhere from three months to nine months to 12 months in some cases," said Paul Schurick, the governor's chief of staff, who came up with the idea.

"Maybe we can take it from 12 months to six months, from nine months to three months." He said projects will be moved ahead "without sacrificing quality or safety."

Schurick said Schaefer hopes state spending encourages private industry and local governments to speed up the schedule of their capital projects.

Schaefer said the projects require no new taxes and have been authorized in the state's existing capital budget. The projects are financed by the sale of general obligation bonds.

Schaefer's announcement at a news conference in Annapolis caught Cabinet officials and key staff members by surprise. But word soon swept through the bureaucracy.

"I think this is a can-do kind of process," said Richard Pecora, deputy secretary of the state Department of General Services, which manages most of the state's contracts.

Pecora said DGS will immediately begin sifting through projects looking for those requiring large work crews.

"The emphasis will be on those projects that are labor-intensive as opposed to equipment-intensive," said Pecora.

Despite scant details, the plan got a warm reception in various legislative and commercial circles.

"It's a good idea," said Del. Charles J. Ryan, D-Price George's, chairman of the House Appropriations Committee. "If we can pump some extra money out there, you get a few extra jobs."

"Certainly any more work that comes out can't be too soon or enough," said Robert E. Latham, executive director of the Maryland Highway Contractors Association and the Marylanders for Efficient and Safe Highways.

Latham said Maryland's highway contractors desperate for work are submitting bids 20 to 25 percent below the state's cost estimates.

Elsewhere, one economist said he was intrigued by Schaefer's plan.

"In theory it sounds like a good idea," said Charles W. McMillion, president of MBG Consulting in Washington and an expert on Maryland's economy. "We need something to counter all the bad news and we need to build up some purchasing power before Christmas."

"We are in a downward spiral with bad news following bad news," he added. "I doubt that $300 million in a state like Maryland can do it. But it can't hurt."

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