Md. raising lid on BDC could foster U.S. model

November 08, 2006|By Jay Hancock | Jay Hancock,Sun Columnist

Shucks, as a legal case it was a no-brainer, lawyer John C. Murphy said when I congratulated him on prying open the Baltimore Development Corp. to public view.

And he's right. BDC is financed by government, controlled by government and instrumental in executing one of government's most fearsome powers: taking private property from one party and giving it to another. Of course, the people of Baltimore and Maryland should be able to scrutinize its machinations.

It's amazing that BDC could block the sunshine so long - from its birth in 1991 until last week, when Murphy's west-side-business-owner clients won a critical case before Maryland's highest court.

But the benefits don't have to end with BDC chief Jay Brodie welcoming strangers to his Charles Street sanctuary. For all the progress it represents, the court's decision merely subjects BDC to public information laws that apply to other Maryland economic development agencies. Even those laws are inadequate.

The General Assembly should seize on the victory in Baltimore by creating a national model for taxpayer-financed, economic development disclosure. It should require centralized and lucid publication of all tax breaks, sweetheart loans, incentive grants and other emoluments furnished to private parties from the public purse.

Call it the 2007 Truth-in-Corporate-Welfare Act.

Want to know who's getting subsidized industrial revenue bonds and for how much?

Who's getting county development grants? Who's paying cut-rate property taxes by virtue of location in an enterprise zone? Who's having workers trained at taxpayer expense? Who's dipping into the state "Sunny Day" development fund or receiving the biotechnology investment tax credit? Who gets to make "payment in lieu of tax" and how much of a discount they're getting off the sticker tax rates?

The corporate welfare file would tell all. Every booster agency would have to report. The Howard County Economic Development Authority. The state Department of Business and Economic Development. The Maryland Venture Fund. The Kent County Economic Development Office. BDC.

Especially BDC.

You can already get scattered information on many of these programs. But it takes dozens of phone calls, official public-record requests and other hassles. And some information is out of bounds. Just try finding out who's getting Maryland's job-creation tax credits.

On the Web

Maryland won't call it the corporate welfare file, of course. It'll be a "Unified Tax Abatement and Economic Development Incentives Report" or some such. But that's the idea: An easily accessible database (on the Web, of course) of every Maryland business that is competing on a uh, slightly more favorable playing field, tax- and incentive-wise, than everybody else.

Taxpayers will see exactly where their money is going, and businesses will see exactly which of their competitors are being subsidized.

It'll be similar to, but less ambitious than, the recently enacted Federal Funding Accountability and Transparency Act, which requires a Web-based database listing everybody who gets federal grants and contracts. Open government works best.

There's even precedent. Illinois has done something similar. In Maryland's 2005 General Assembly, Baltimore County Del. Adrienne A. Jones and others sponsored an expanded economic-development reporting act. But business interests got it shot down, saying the work would be too onerous, says Jason Perkins-Cohen, executive director of the Job Opportunities Task Force, which supported the measure.

More paperwork for companies is something to consider, but it seems a small price if you're getting somebody else's (taxpayers') free or subsidized dollars. Besides, state and local agencies can do most of the work.

BDC was truly a secrecy overachiever. It didn't just take one person's taxes and pass them to somebody else through incentives. It was instrumental in seizing real estate through eminent domain proceedings. Yet you couldn't even attend its board meetings.

`Lacked so much'

"We had never encountered a local public-private body that lacked so much disclosure," says Greg Leroy, head of Good Jobs First, a Washington nonprofit that has looked at hundreds of similar groups across the country.

Shoving it into the daylight is good for everybody, including BDC. Now Annapolis should take the next step and raise the shades across the entire economic development edifice. That's a no-brainer, too.

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