Base realignment bringing jobs, costs

Towson Univ. study forecasts impact across Md. of military buildup

July 13, 2006|By TIMOTHY B. WHEELER, JUSTIN FENTON AND PHILLIP MCGOWAN | TIMOTHY B. WHEELER, JUSTIN FENTON AND PHILLIP MCGOWAN,SUN REPORTERS

The Pentagon's military base realignment will swell Maryland's population by roughly 28,000 households over the next decade, a Towson University report predicts, in what some economists suggest will be the biggest defense-related buildup in the Baltimore-Washington region since World War II.

In a draft report prepared for the state Department of Business and Economic Development, Towson's research and consulting arm, RESI, forecasts that the base shuffling ordered last year could yield more than 45,000 jobs for the state - many of them high-paying civilian military and defense contractor positions moving to Aberdeen Proving Ground and to Fort Meade.

The National Naval Medical Center in Montgomery County and Andrews Air Force Base in Prince George's each would experience a smaller net increase in jobs.

The report, the most comprehensive effort to date, says the base-related growth, including about 7,200 spinoff jobs generated to serve the new defense workers and their families, should boost incomes in one of the nation's most affluent states. It will also pour hundreds of millions of dollars annually into local and state tax coffers.

"It's one of the largest postwar movements of jobs into Maryland," said Daraius Irani, RESI's director of applied economics. He characterized it as a "sea change" for the state's economy. Many of the jobs are expected to land in Maryland over the next three to five years.

The Towson report, a copy of which was obtained by The Sun, forecasts that Harford and Anne Arundel counties, homes of Aberdeen and Meade, would see the biggest growth in jobs, population and tax revenues from the base moves. But the impact would be spread throughout the state, the study suggests, with many of the new workers likely to settle in Cecil County, Baltimore City and elsewhere.

Some enterprising business people didn't need this study, though, to see opportunities coming.

Richard W. Naing, a Potomac-based developer, said the expected influx of base-related jobs is driving his plans to build 3,000 apartments and condominiums in the next five years, including two 60-story high-rises in downtown Baltimore.

"It's huge," Naing said of the base shuffle.

He said his development plans for the city are geared to the high-wage workers the base shifts will bring: "They're going to want urban, high-density, affordable living in a 24-hour city that's close to their jobs. That leaves Washington out and puts Baltimore in."

The Towson analysts estimate the average wage of each new job to be about $65,000 and the income of each household moving to Maryland because of the military shifts to exceed $100,000 - well above last year's estimated state median household income of $64,000.

"This is going to be keeping the growth going in Maryland," said Richard Clinch, director of economic research for the Jacob France Institute at the University of Baltimore. He suggested that the base realignment could help stabilize and maintain the state's robust economy - which was expected to add about 50,000 jobs this year alone.

But others see the base-related growth as a challenge for a state wrestling with soaring housing costs, sprawling development, clogged highways and overcrowded schools.

"We don't have a lot of extra capacity on our roads; we have a growing issue with our drinking water," said Dru Schmidt-Perkins, executive director of 1000 Friends of Maryland, a group advocating compact development and land conservation.

"So the concern is, of course, where are these people going to live?" she asked. "How are they going to get around? What resources are they going to need? And are we going to be able to provide all that when they get here?"

J. Michael Hayes, director of military and federal affairs for the state's economic development agency, cautioned that the Towson group's study is still in draft form and just part of a larger effort by the state to address the anticipated growth.

Harford County Executive David R. Craig has already appointed several task forces to study the base realignment's impact on public safety, transportation, housing and education.

The Towson study projects that local and state governments should reap more than $400 million a year in income and property tax revenues from base-related growth. But the expenditures to handle the growth are also large.

In Harford alone, the county executive has committed $200 million to build new schools. The state has committed to widening Interstate 95 from Baltimore County through Harford, as well as upgrading interchanges near Aberdeen Proving Ground that already back up at rush hour - projects whose price tags total in the billions of dollars.

At least one independent economist warned officials not to overreact to growth projections, cautioning that "forecasting of this nature is wildly speculative and full of unknowable and non-quantifiable uncertainties."

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