Baltimore, Washington to get one CPI

April 05, 1995|By Kim Clark | Kim Clark,Sun Staff Writer

As a part of the further meshing of Baltimore and Washington, the federal government will soon announce that it will stop collecting and calculating separate consumer price indexes for the two metro regions.

Instead, the Bureau of Labor Statistics is preparing a new Washington-Baltimore regional index -- the main statistic that reflects inflation -- which will provide a single figure for a region stretching from Martinsburg, W.Va., to Queen Anne's County on Maryland's Eastern Shore. The new number will be published starting in 1998.

Business people and economists said the change would be a mixed blessing for Baltimoreans, raising some costs, but also potentially raising some revenues and attracting new business.

But city historians warned that the disappearance of a separate Baltimore listing from such important economic statistics could further erode the city's already troubled sense of identity, and might even harm its attempt to win a National Football League franchise.

"Poor Baltimore," said Wayne Schaumberg, who teaches a course on Baltimore history at local community colleges. "This has been our lot in life. Look at maps of the East Coast put out by Amtrak and the airlines. Baltimore is never shown. There is Boston, New York, Philadelphia, then Washington."

The absorption of Baltimore into a "Washimore" or "Baltington" statistical area could even buttress arguments by some NFL team owners that Baltimore should not have a team because Washington-Baltimore is one market and already has a team, he added.

The effect most will notice, however, will be on their pocketbooks.

Because most of Washington's inflation numbers tend to be higher than Baltimore's, the combined statistic will likely make Washington's inflation rate look lower -- and Baltimore's higher -- than the separate statistics.

That means accelerated price boosts for local contracts indexed to the Consumer Price Index (CPI). Many Baltimore renters, for example, will see increased costs, while some service suppliers will see increased revenues.

R. Bruce Campbell, president of Wallace H. Campbell Co. Inc., which owns malls and doctors' offices around Baltimore, said nearly all of his commercial leases call for annual rent increases indexed to the local CPI.

He'll collect more rent, but it will also cost him more, since many of his service contracts -- with landscapers and elevator companies, for example -- are similarly indexed.

Michael A. Conte, director of regional economic studies at the University of Baltimore, said the combination will make it more difficult for Baltimoreans to show off one of the city's key advantages over neighboring regions.

"We are cheaper," he said. "And that is a very powerful argument to have."

But, because it makes Baltimore-Washington the nation's fourth-largest economic region, the new statistical area might also attract businesses looking for new markets, he said.

"If you are going to move to Washington-Baltimore, you have to choose where you're going to locate: Washington or Baltimore. And then you'll find out Baltimore is cheaper."

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