News Column

Our say: State's private sector finally gets a lifeline

February 2, 2014

Last week's announcement of a joint economic development agenda drawn up by House Speaker Michael E. Busch and state Senate President Thomas V. Mike Miller Jr . may be remembered as the first day of Maryland's post- Martin O'Malley era. While Republicans tend to view the state's Democratic leadership as one indistinguishable liberal blur, Miller and Busch are more business-oriented than the lame-duck governor they have loyally served. So they are willing to push actions that tacitly acknowledge a point Republicans have been stressing for years: Maryland doesn't have the sort of business climate it deserves, given that it has top- flight universities and government institutions that work at the frontiers of high tech. A key part of the joint agenda, the first one Miller and Busch have ever announced, is the creation of a private-sector commission to do a report on state economic development by the end of the year - - in time for it to go into the in-basket of O'Malley's successor. But we're sure Busch and Miller also want their ideas to shape the debate in this year's gubernatorial election. The simplest of these ideas, which we've talked about in this space, is altering Maryland's exorbitant estate tax to get it line with the federal standard, which puts the minimum taxable estate at $5.25 million . In Maryland , at present, it's $1 million for an individual estate, $2 million for a couple -- and some longtime Marylanders, including owners of small businesses, are leaving for friendlier climes. But there's much more to the agenda, most of which is supposed to be embodied in legislation this session. Among the proposals: reduced-tax zones around "anchor institutions" such as universities and research centers, an investment fund to put up to $100,000 into early-stage cyber security and privacy companies, auctioning tax credits to the private sector to fund research endowments at universities, and a program to hone the management skills of new entrepreneurs. Certainly Republicans will get behind the estate tax reduction, even if their endorsements are accompanied by gibes about Democratic Johnny-come-latelys who prefer to start tax relief at the point that the taxpayer's breathing stops. Some of the other main points of the agenda will prompt complaints -- perhaps not just from Republicans - - about liberals who, instead of offering general tax and regulatory relief, want to design complicated, narrow-gauge programs that single out certain companies and industries as economic winners. Still, with both Busch and Miller pushing it, much of the agenda is likely to pass. The reduction in the estate tax and other aids to the business climate will be useful -- and the commission report may be the rare document of its type that prompts more sweeping action in years to come. All in all, this was a good first step to help a struggling state private sector.

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Source: Capital (Annapolis, MD)

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