View photos from Maryland Chamber of Commerce Business Day in Annapolis.
From highways to the sales tax, business executives pressed their case with state lawmakers Thursday, as they descended by the hundreds on Annapolis for the Maryland Chamber of Commerce’s annual Business Day.
During a morning forum at the Loews Annapolis Hotel, the crowd of some 400 businesspeople also applauded statements by the state’s top Republicans — House Minority Leader Anthony J. O’Donnell (Dist. 29C) of Lusby and Senate Minority Leader E.J. Pipkin (Dist. 36) of Elkton — opposing a plan in Gov. Martin O'Malley’s budget proposal to cap mortgage and other income tax deductions, and roll back exemptions for residents with incomes of more than $100,000.
“I think the crowd’s reaction spoke for itself,” said John P. Hollerbach, president of Ellicott City business consulting company Hollerbach & Associates and a chamber board member. He is also former CEO of HarVest Bank of Maryland in Gaithersburg.
O’Donnell said O’Malley’s plan would target “thousand-aires,” not just millionaires.
“It’s not helping to create an environment that creates jobs,” he said. He added that there was already too much "regulatory overreach" in state government.
O’Malley (D) made the deduction cap proposal this week to help close a $1 billion deficit in the state's operating budget. Instituting those caps will bring in $182 million annually in new revenue, and only 20 percent of Maryland residents will see their income taxes rise as a result, according to the governor’s office.
Pipkin said phasing out deductions and exemptions will give executives who make decisions on locating their companies another reason not to stay in, or move to, Maryland.
The plan “will punish those people for coming here,” he said. “I want Maryland to be a state where businesses want to be here and not one where they have to be here to be close to Washington, D.C.”
Legislators must balance concerns over tax changes with the need to fund expected services such as education and transportation, said Aris Melissaratos, senior adviser to the president of Johns Hopkins University in Baltimore. He also was secretary of the state Department of Business and Economic Development under Republican Gov. Robert L. Ehrlich Jr.
“Taking away the deductions that people have come to expect can hurt. ... It’s not an easy issue,” Melissaratos said.
‘Thousands of jobs’
House Speaker Michael E. Busch (D-Dist. 30) of Annapolis said O’Malley’s budget will help create “thousands of jobs,” including in the construction industry, as more money is targeted for school construction and other projects. Maryland’s high-quality education system is a big reason the state is attracting thousands of new jobs through the Pentagon’s base realignment process and in cybersecurity, he said.
In his fiscal 2013 budget proposal, O’Malley also proposes requiring online retailers, such as Amazon and eBay, to collect Maryland sales taxes and doubling the state's $30-a-year "flush tax” on sewer bills.
The fiscal 2013 budget proposal includes a $23 million investment in InvestMaryland, a program formed last year to pump more capital into businesses. It also calls for $10.4 million for stem cell research, $8 million for biotechnology investment tax credits, $7.5 million for the film production tax credit and $7 million for tax credits for urban redevelopment.
Legislators should boost the biotechnology investment tax credit from $8 million to $12 million next year, said Douglas Doerfler, president and CEO of Gaithersburg biotech MaxCyte. He also is vice chairman of the Tech Council of Maryland and chairman of its MdBio Division board.
The Maryland chamber and other business groups support an increase in the fuel tax as long as it is earmarked for transportation projects only. That is something that should have been done in the 1990s, Melissaratos said.
A coalition of business groups that included the Maryland chamber, Greater Baltimore Committee and Greater Washington Board of Trade was rallied outside the State House Thursday afternoon, seeking more funding for transportation projects at least partially paid by the increase in the fuel tax. About 100 people attended, said Kathleen Snyder, CEO of the Maryland chamber.
“There is a great unmet need,” Snyder said. “For instance, even though the Purple Line is being studied, there is no money for it.”
Visiting legislators
Later Thursday, many businesspeople visited lawmakers’ offices to discuss specific bills and other issues. Jay Hellman, president of Hellman Co. of Potomac, who is developing property in Bethesda, said he was speaking to legislators about a bill that was introduced last year by Del. Marvin E. Holmes Jr. (D-Dist. 23B) of Kettering that would allow more variety in projects.
The bill, which did not get out of committee last year, would have authorized a local jurisdiction to establish a state rail station overlay district near rail stations that would allow alternative regulations to those required by the zoning classification.
Hellman said he wants more flexibility to have, for instance, a one-story building next to multistory buildings so the structures are not all the same. Holmes has said he will file the bill again this session, Hellman said.
“It would make it easier” to have the flexibility, Hellman said of the bill. “I’m here trying to drum up support for this bill.”
David Lowe, CEO of isi Federal, a Linthicum Heights consulting company that helps clients do business with the federal government, was attending his first Maryland chamber function. He found the discussions intriguing.
“I want to get more involved with the chamber,” Lowe said.
This year’s Business Day was among the most well-attended, Snyder said. Members from many chambers of commerce participated, including the Greater Bethesda-Chevy Chase, Greater Silver Spring, Montgomery County and Prince George’s County chambers.
kshay@gazette.net
