IT'S NO PANACEA, but the Glendening administration's proposed tax credit for firms creating new jobs in growth industries sends the right signal to corporate America. It lets companies know that from now on Maryland intends to be more creative and competitive in pursuing business opportunities and in helping in-state firms expand here.
Other states, including Virginia, have benefited enormously from similar tax-credit programs. The idea is to encourage companies to bring large-sized plants to Maryland. The more jobs created, the bigger the tax credits. And if the employer locates a new or expanded plant in an economically depressed area, the credit is doubled.
The governor wants up to $10 million a year to use as tax-credit bait in targeted industries such as manufacturing, R&D, communications, computer services, finance, real estate and agriculture. Companies would have to pay workers more than $13,300 a year and create at least 50 new jobs. A new 500-worker plant in an impoverished neighborhood, for instance, could be eligible for $331,500 in tax credits.
That's a substantial sum, but hardly enough on its own to sway corporate decision-makers. It is, though, a clear signal to businesses that Maryland wants them to feel welcome and is anxious to help with the transition. When three experts on job relocation were interviewed by Sun business reporters last Sunday, all three agreed that this is exactly what is needed to start changing Maryland's anti-business image.
In recent years, the legislature rather than the governor has been the sticking point in erasing the impression that Maryland is hostile to businesses. And sure enough, lawmakers are questioning and nitpicking the governor's tax-credit bill -- even though they offer no better alternatives. This bill, along with other moves by the governor, represents an effort to make state government more positive toward business growth and development. Jobs are what this state needs, and the tax-credit bill would help bring more of them to Maryland.