Development agency backed

House votes bill upholding MEDCO's bonding authority

March 27, 2001|By Michael Dresser | Michael Dresser,SUN STAFF

The House of Delegates gave a vote of confidence to the Maryland Economic Development Corp. yesterday as it passed legislation reaffirming its authority to develop projects requested by local governments.

The bill, which passed 106-27 over objections of delegates who said it gave MEDCO too much power, is intended to clear up questions about the quasi-public corporation's authority to issue bonds. Investors had been reluctant to buy MEDCO bonds because of legal questions raised in connection with an Anne Arundel County golf course project.

The measure, sponsored by House Speaker Casper R. Taylor Jr., an Allegany County Democrat, now goes to the Senate.

MEDCO was created by the General Assembly 17 years ago to acquire and redevelop a closed Fairchild aircraft plant in Washington County. Since then, it has undertaken a wide variety of projects over the state - including the Rocky Gap golf resort in Allegany County, student housing at Towson University and a building for human genome research in Montgomery County.

The corporation ran into difficulty last year over its plans to plan to develop a 36-hole golf course on Fort Smallwood Road on behalf of Anne Arundel County. The owners of a private golf course in the county sent a letter threatening to sue, contending that MEDCO had overstepped its authority by taking on the project known as Compass Pointe.

The letter cited the law establishing MEDCO, noting it was set up to invest in projects in economically distressed areas where private businesses have not shown a serious interest.

MEDCO responded by proposing an extremely broad bill giving it almost unlimited authority to undertake just about any project it chooses - whether or not it competes with the private sector.

The House added amendments narrowing the bill slightly. MEDCO still would be able to take on any job requested by a local government, and its board could still develop other projects as long as it certified that no private entity was likely to do so.

The changes did not satisfy House critics such as Del. David R. Brinkley, who charged that the legislation gives MEDCO "a blank check."

"It's trying to give some legitimacy to an organization that has overstepped its bounds," said the Frederick County Republican.

But Del. Kumar P. Barve, the bill's floor manager, extolled MEDCO's economic development record, saying it had brought useful projects to all parts of the state.

"MEDCO is a terrific vehicle for the state of Maryland. It is one that has worked well," the Montgomery County Democrat said.

The bill now goes to the Senate Budget and Taxation Committee, where several members have expressed concern about the breadth of the mandate given MEDCO in the original bill.

If the committee is satisfied with the changes made in the House, the measure will likely pass easily. If it is not, the legislation could end up going to a House-Senate conference committee, where its fate would be uncertain.

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