Lawmakers approve $16.4 million in aid for businesses High-tech companies, glassmaker get grants

Sunny Day Fund

June 10, 1998|By JoAnna Daemmrich | JoAnna Daemmrich,SUN STAFF

Maryland lawmakers approved $16.4 million in economic development aid to private industry yesterday, boosting a group of high-tech companies and a hand-blown glass manufacturer moving into depressed Garrett County.

In contrast to last year, the Legislative Policy Committee gave its blessing to the latest round of business grants and low-interest loans with little debate.

None of the expenditures from the state's Sunny Day Fund was politically sensitive, unlike the $500,000 sought by the Glendening administration last year for an influential chain of radio stations. Cathy Hughes, the stations' co-owner, turned down the controversial loan in January to protest the General Assembly's expulsion of Baltimore Sen. Larry Young for ethics transgressions.

According to state officials, the 10 business development initiatives approved yesterday are expected to create as many as 3,600 new jobs and keep an existing 4,800 jobs in Maryland.

One of the smallest yet potentially most far-reaching aid packages went to a pottery and glass manufacturer that is moving to Garrett County.

Simon Pearce, based in Vermont, is taking over the old Bausch & Lomb plant that was the county's biggest employer until it closed in 1996.

The company won $500,000 in start-up aid, though some lawmakers expressed reservations because it did not come up with the required private investment match.

State business officials, however, touted the project as a way to put 150 people to work in the northwestern corner of Maryland. Unemployment in the Appalachian hills of Garrett County has hit double digits, and the new jobs could help 7 percent of the jobless, said James D. Fielder Jr., acting secretary of the state Department of Business and Economic Development.

"These are extraordinary economic development conditions," he said.

Sen. Clarence W. Blount, a Baltimore Democrat, agreed the county "needs all the help it can get."

Of the successful applicants chosen from 59 firms seeking Sunny Day assistance, half were high-tech and biotechnology companies.

In the highly competitive technology industry, companies generally try to preserve as much of their cash flow as possible for research. Many have sought state aid for construction of new headquarters or new labs.

Among them were the Rockville-based BioReliance Corp., which won a $3 million, interest-free loan to help a subsidiary expand and to lease a new manufacturing plant.

The subsidiary, Magenta Corp., received $3.5 million in federal contracts last fall to produce viral materials for experimental gene therapy studies by the National Institutes of Health.

Manugistics Group Inc., a manufacturing software maker based in Rockville, obtained a $1.75 million loan to help lease or purchase new offices.

The loan will be forgiven if the company keeps 445 of its 1,300 employees in Maryland and creates an additional 555 jobs.

Manugistics recently acquired Tyecin Systems Inc., a Los Angeles software manufacturer, after a tumultuous few months in which its stock value soared 40 percent in March, only to plummet in May after disappointing first-quarter earnings.

Other expenditures included $1 million to AlliedSignal Corp. to buy equipment as part of a $17.2 million new facility in Columbia; and $2.4 million to Maryland Casualty Co. for renovations and construction of a parking garage in North Baltimore's Roland Park.

Pub Date: 6/10/98

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