Business community pleasantly surprised

`We got the things done we wanted,' Md. chamber leader says

General Assembly

April 14, 1999|By Timothy B. Wheeler | Timothy B. Wheeler,SUN STAFF

From electricity deregulation to Y2K, this year's General Assembly session produced surprisingly bountiful returns for Maryland's business community.

Business leaders, who began the 90-day session worried about the political fallout from last year's elections, found far more to celebrate yesterday than to bemoan.

"Overall, considering this was a pretty tough session, we got the things done we wanted," said Champe McCulloch, president of the Maryland Chamber of Commerce.

Though they failed to block collective bargaining for state employees and could not muster support for accelerating the 10 percent cut in the income tax, business leaders say other legislation passed that offsets those two defeats.

The Assembly's most important -- and difficult -- contribution to Maryland's economic landscape was legislation enabling businesses and residential consumers to shop for cheaper electricity, starting July 1, 2000.

"Electric restructuring is a great tool for economic development," said House Speaker Casper R. Taylor Jr. The Allegany County Democrat joined with Senate President Thomas V. Mike Miller in steering the complex bill through the Assembly, overriding opposition from consumer and environmental advocates. The veto-proof margin by which the measure passed forced Gov. Parris N. Glendening to sign it despite his reservations.

"It's critical that passed," said McCulloch, who noted that deregulation failed last year because of divisions within the business community. "Maryland could not have afforded to wait another year."

Business advocates had been anxious at the beginning of the session in mid-January because of the loss of some friendly faces in the legislature and the re-election of Glendening, whom many had opposed as neglectful, if not hostile, toward business.

But from the opening weeks to their final hectic day, lawmakers demonstrated their sensitivity to economic concerns. The first bill enacted -- and signed by the governor -- was a measure enabling Baltimore Gas and Electric Co. to form a holding company, which had failed the year before.

Glendening made that one of his economic priorities, and he delivered on his other business initiatives: more legal protections against hostile business takeovers and two new economic development loan funds.

"It's a very good basis for real progress ahead," said Richard C. Mike Lewin, state secretary of business and economic development.

Distressed areas aid

The administration also won legislative approval for up to $44 million in loans, grants and tax credits to keep Marriott International Corp.'s headquarters in Montgomery County. Many in the business community saw that as a crucial test of the state's resolve to hang onto one of its largest employers.

With support from Glendening, the House speaker secured passage of his "One Maryland" package of business credits and $10 million in economic development loans for the distressed rural and urban portions of the state.

In the Baltimore area, business leaders took heart from passage of legislation authorizing the city to grant real estate tax breaks to developers of hotels and other major projects. They also hailed the inclusion of $1.8 million in the budget for design work on rehabilitating the Hippodrome Theater, the cornerstone project of an ambitious west-side redevelopment plan.

"I think the city and region did pretty well," said Donald P. Hutchinson, president of the Greater Baltimore Committee. The regional economic development group also succeeded in getting more than $1 million in state funding for a community court to try misdemeanor cases in the central business district and surrounding communities.

The real estate industry won a bill requiring semiannual property tax payments, which could reduce the state's steep closing costs by about $700 per transaction.

The health care industry also won a small victory: a bill calling for consolidation of the state's commissions that regulate hospital rates and services.

Not all of business' victories came from legislation being passed. Bills that would have made it easier to win lawsuits against business, and to collect greater damage awards in cases of asbestos exposure, failed, as did measures that would have allowed patients to sue health maintenance organizations or get HMO medical directors' licenses revoked.

A bill also died that would have boosted unemployment insurance benefits -- which the chamber attacked as a potential $112 million tax increase on business.

Lawmakers dodged some issues of importance to the business community, notably a gasoline tax increase to finance more highway and transit construction. Glendening and Assembly leaders avoided a potentially nasty legislative fight by agreeing to study the state's transportation funding needs for another year.

The fate of one business-backed bill remains in doubt. The governor has yet to say whether he will sign or veto a measure granting some legal protection to businesses and individuals for problems that might be caused by the Year 2000 computer glitch. Glendening had insisted that lawsuits be permitted if people are harmed or killed by the Y2K bug, but lawmakers did not yield.

"The bill that we got through was not everything we wanted," said the chamber's McCulloch, "But it sets in place a framework so that businesses that do what they're supposed to get at least some protections assuming the governor signs it."

Pub Date: 4/14/99

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