Marylanders need a raise. The Great Recession of 2008 and further structural changes to our economy have created a more polarized society where some flourish while others flounder. Too many mothers and fathers must work two or three jobs to provide for their families. Too many parents are left wondering how they will pay for college for their children or their own retirement. Too many of our workers and companies remain exposed to the upheavals of our federal government’s budget process.
This must change. As Governor, I will foster an environment that promotes economic growth and creates good-paying jobs, expanding opportunity and giving hard-working Marylanders the raise they deserve. I will build our economy from the middle out to create, once again, a dynamic and growing middle-class. I will work with private and public-sector employers to expand economic opportunity across the state. My administration will work to attract the jobs of today and prepare Marylanders for the jobs of tomorrow.
With our natural strengths, Maryland’s economy should outperform that of the nation as a whole. That is not currently happening under Governor Hogan. He ran on a message of economic growth and continually hit the previous administration for its economic development results. When he was elected, he plastered “Open for Business” everywhere he could. However, under Governor Hogan’s leadership, Maryland’s rate of job creation and wage growth falls well below the national average. The state’s fiscal solvency is also wavering. He has not developed a comprehensive economic development plan, and instead engages in a damaging race to the bottom in which he hands out big incentives to businesses but does not do much else.
I have significant economic development experience, and I will use it to invest in Marylanders and grow our economy. As Chair of the University of Maryland System, I focused on leveraging the research discoveries of our peerless higher education institutions to create small and start-up businesses. As Chair of the Empower Baltimore Management Corporation, I worked to support the creation and expansion of small businesses in East and West Baltimore by providing job training programs and access to capital. And, I actually built a business, leading Venable for 22 years as it grew by 1000% and became a global enterprise. I will take the skills and experience I have developed over the past several decades as I work to create more good-paying jobs across Maryland.
As Governor, I will:
- Build on Maryland’s institutional strengths, including its location along the Northeast Corridor, top higher education institutions, world-class port, major public research facilities, and strong agriculture sector.
- Provide Maryland’s businesses with a top-tier labor supply by improving the state’s public education systems so all students graduate college or career ready.
- Invest in new infrastructure projects to power economic development and create good-paying jobs across the state.
- Ensure that Maryland’s government is responsive to the needs of small businesses and start-ups expanding access to capital and cutting unnecessary and burdensome red tape.
- Support our agricultural industries while working to create a cleaner and more environmentally-friendly economy.
- Alter Maryland’s focus from engaging in a race to the bottom to growing from within by investing in Maryland’s people and increasing labor force participation.
As we move deeper into the 21st century, Maryland must adjust to a changing economy. We can create a system that works for everyone, grow the middle class, and make Maryland a place of opportunity. To do so, we must use the resources the state has at its disposal in an efficient and effective way to support and invest in the true job creators in the state: the people.
Maryland’s Current Status
When he ran for Governor in 2014, candidate Hogan largely focused on economic issues. He railed against the previous administration’s handling of the economy, and said that, if he were elected, things would change1. Larry Hogan loves to talk about how many jobs the Maryland economy has created under his leadership, but he never puts those numbers into the proper context. In the three years since he was elected, both job growth and wage growth in Maryland have fallen below the national average2345. Larry Hogan’s economic underperformance is not terribly surprising when one considers what he has done as Governor. His economic development plan has largely consisted of renaming a cabinet agency and cutting some consumer protections.
During Governor Hogan’s inauguration – after he was introduced by Chris Christie – Hogan delivered a speech that hit on the “freedom to compete without the undue burden of high taxes and bureaucratic regulation,” and he said that he “envision[ed] for Maryland … an economic and fiscal recovery.” He said, “everything we do will be guided by four common-sense principles. First: fiscal responsibility.”6 Now, three years later, the taxes and fees that Governor Hogan so vigorously campaigned against are generally still intact, and Governor Hogan has enjoyed spending the money himself. Maryland is projected to suffer from a $250 million budget shortfall in FY19, and that deficit is expected to grow in the following years7. Further, with the upheaval that Donald Trump and Congressional Republicans seem intent on causing, federal funds are becoming less reliable, which will hurt our state’s financial outlooks.
The root cause of this budget deficit is our state’s, and Governor Hogan’s, failure to invest strategically in Maryland and its people. Instead, he has starved our critical needs of key resources. In running my business, and in serving as Chair of the University System of Maryland and the Empower Baltimore Management Corporation (EBMC), I have learned that cutting from critical needs does not set a business on a path towards prosperity. The state’s revenue situation is similar. Governor Hogan has engaged in a race to the bottom. He wants to cut as many taxes and regulations as he can in the hope of attracting the next 50-person corporate headquarters. The fact remains that, nationwide, this sort of “poaching” only accounts for about 2% of a state’s job growth8. Instead, we should be focusing on investing in Maryland and its businesses to grow from within. And when a company like Discovery Communications leaves Maryland, along with its 1,300 jobs, the proper response is to take responsibility and look for ways to create more jobs and ensure it doesn’t happen again. Instead, Governor Hogan said, “No, we’re not responsible. … In the great scheme of things, it’s not going to be the biggest thing in the world.”9
Governor Hogan’s habitual underfunding of public education and his misguided transportation infrastructure priorities are two prime examples of his refusal to smartly invest in Maryland. A strong public education system is the backbone of an economy. Not only do companies want to hire from a world-class workforce, but start-ups and small businesses, the lifeblood of job growth, are often created by entrepreneurs who develop their skills in Maryland’s classrooms. Under Governor Hogan, education spending has not kept pace with the general fund growth10111213. In his first year, he cut the Geographical Cost of Education Index, which gives more money to jurisdictions in which it is more expensive to educate students14. He has proposed eliminating the inflation factor, and he has diverted funds to a private voucher system15. These decisions have real consequences, as Maryland’s once preeminent public education system continues to slide to the middle of the pack16.
Targeted investments in infrastructure, including mass transit systems that many employers identify as essential to their continued growth, would create good-paying jobs, promote the flow of commerce, and improve the economic attractiveness of our state. Governor Hogan has foiled transformative opportunities to increase the interconnectivity within our cities and across our state by cancelling the Baltimore Red Line and devoting billions of dollars to road widening construction1718. Rather than devising and implementing a multi-modal vision that gets people to their jobs and schools quickly and reliably, he has spent the state’s money on short-term fixes that studies show will not significantly improve congestion. Instead, due to induced demand, we will simply end up with more cars on the road. The State Center redevelopment, a project that would have provided an economic lifeline to families in West Baltimore, has been stuck in limbo because Governor Hogan refuses to act19. Pipes across the city of Baltimore and the state burst on a regular basis, leading to disrupted commutes, frustratingly late and costly repairs, and a halt to the flow of commerce. The economic results of the state are unsurprising given these disappointing decisions.
Building on our Strengths
It does not have to be this way. Maryland starts with tremendous competitive advantages, particularly in the industries that will be the engines of growth for years to come. The state’s cybersecurity, healthcare and medical research, higher education, biotechnology, and aerospace and defense technologies industries create good-paying jobs across the state. We must seize the opportunity to harness Maryland’s assets so that Maryland workers, not workers in other states or countries, are the beneficiaries of the economic opportunities that our state’s assets are producing and will produce.
We have the leading research facilities at the NIH, NASA’s Goddard Space Flight Center, Social Security, the Food and Drug Administration and National Security Agency headquarters, and major military and Department of Defense facilities, including Fort Meade, NAS Patuxent River, and Aberdeen Proving Ground. Maryland’s educational institutions and medical research facilities, including the University of Maryland system and Johns Hopkins University, provide the state with a groundswell of human capital and technological advantages. Our geographical position, located on the Northeast Corridor with the Port of Baltimore and Chesapeake Bay, is also economically beneficial.
Currently, the state is not exploiting these advantages by connecting the various institutions in our state, including the ones identified above, nor is the state building bridges between these institutions and businesses. These failures result in costly missed opportunities. The research that underlies the technology and the economy of today and tomorrow is being conducted in Maryland. What we are lacking is a well-designed strategy to assure that the commercialization of that research also occurs in Maryland. Without that strategy, the jobs generated from the commercialization of Maryland-based research are at risk of migrating away from Maryland. And, the jobs that are created in Maryland often flow to those who are already at the top of the economy, further establishing economic inequality in our state. Maryland is already a recognized high-tech center. Baltimore, for example, was identified recently as one of the eight areas in the United States where high-paying tech jobs are concentrated20. We can do much more, however, to support and build existing high-tech companies and to see that enterprises not yet imagined, let alone established, find a permanent home in Maryland. Properly investing in high-tech jobs will also give us the opportunity to level the economic playing field and create good-paying jobs for all Marylanders, not just the wealthy.
Maryland is one of the states with the most federally-funded research, giving us a unique opportunity to leverage public investments into life changing economic activity21. When I was Chair of the University System, the Board of Regents took seriously promoting the commercialization of research and oversaw the creation of many new businesses. We succeeded in transforming our flagship educational institution into a powerful economic engine. We set ambitious goals in this area and we far exceeded those goals. By the end of my tenure as Chair, for example, we had supported the creating of 451 new companies, surpassing our goal of 325 in our 2020 Strategic Plan22. I will use that experience and the insights I gained in the process to further the development of high tech businesses in Maryland.
As Governor, I will make capital more accessible, ensure that our schools are second to none and continue to produce world class scientists and engineers, enhance our workforce development programs to ensure our employers have the highly-skilled workers they need, collaborate with the private sector to ensure sufficient access to labs and incubators in which their ideas can take shape, make it easier to interact with government, invest in the infrastructure, and work tirelessly to unlock the potential of publicly funded research.
As Governor, I, along with my economic development team, will visit regularly the
state’s major research, educational, federal, and medical facilities and institutions to see first-hand what they are doing, the challenges they are facing, how the state can assist, and to explore opportunities for joint ventures and collaboration.
As these high-tech businesses flourish, we must make sure that they create opportunities for all Marylanders. Some of the jobs created will require four-year college degrees, and Maryland’s colleges and universities must produce even greater numbers of STEM graduates to fill these jobs. But there are many high-tech jobs that do not require a four-year degree. There will be high demand for workers who have skills as web developers and information technology repair and support personnel. Advanced manufacturing and cybersecurity companies will need skilled technicians and programmers. Manufacturers will need workers to monitor robotic assembly and production facilities. Biotechnology companies will need lab technicians. These and other jobs require skills which we should be teaching in community colleges. Quality education at all levels is inextricably connected to economic development.
As Maryland’s high-tech industries continue to grow, my administration will also make sure that there are good jobs available to those outside of these industries. I am proud of the work our state’s unions have done to secure good jobs for workers on every rung of our economic ladder. Our strong unions are in and of themselves an economic strength – they successfully advocate for and train workers across the state to fill good-paying jobs. Decades ago, unions played an essential role in the creation of the middle class. Under my administration, I will work with labor organizations to ensure that they continue to play an important role in Maryland’s economic growth.
Maryland benefits from its location in the Mid-Atlantic Region with close proximity to Washington, D.C., Philadelphia, New York City, and Northern Virginia. This is a dynamic and growing economic region. Strong regional alliances promote economic activity which benefit the region as a whole. Governor Hogan’s approach, by contrast, of offering financial incentives to lure companies from our surrounding states is of limited utility. Studies show that “poaching” accounts only for about 2% of jobs in a state economy23. While that may help on the margins, it is not a sustainable economic development strategy. Governor Hogan’s “poaching approach” is rooted in his plainly misguided view that economic development is a zero-sum game in which Maryland loses if Pennsylvania gains (and vice versa). We will not succeed by engaging in a race to the bottom to see which state can give the largest deal to a few large corporations. We will succeed by working with our neighbors to grow the regional economic pie, to further our common regional economic interests, and to cement our position as the most dynamic economic region in the world. To enhance regional collaboration, I will work with the Governors of the surrounding states on a regular basis to identify and pursue common initiatives to benefit the entire region. Transportation and other infrastructure needs, for example, are regional, and Marylanders look to our neighboring states to market their goods and services, to go to colleges and universities, and to work.
A Job-Ready Workforce
Businesses rely on a well-trained and robust supply of labor. For our economy to flourish, we must improve our education system, from pre-k through our higher education institutions. As Governor, a world-class public education system will be my top priority, not only because it provides all children with the opportunities they deserve, but also because it will become the backbone of our economy for decades to come. Amazon’s request for proposal for a second North American headquarters lists a good system of education as one of its top requirements24. A strong public education system increases the economic attractiveness of our state by providing a strong labor supply, and it also gives our children the resources they need to become the entrepreneurs and business leaders of the future. Start-ups and small businesses, the lifeblood of an economy, are often created by entrepreneurs who develop their skills in the classroom.
We must never lose sight of the fundamental principle that we will not have a strong, growing economy in our state unless we have an adequately funded and comprehensive education system. We need a system of education, from pre-k on, which provides the students of today the education and training they need to work in and start the businesses of tomorrow. Education must prepare students for a life of productive and satisfying work. The vast majority of good-paying jobs will require some level of technical or professional proficiency and skill, and we must build our education system accordingly. As described in my previously issued Education Plan I intend to upgrade our educational programs at each level, from early childhood education through community and four-year colleges.
For Maryland to have the world class pre-k through 12 system it needs, we must provide adequate funding to give every child the opportunity to learn. We must create a funding formula that accounts for areas of concentrated poverty and establishes community schools in areas of need. We must implement a rigorous curriculum, benchmarked against international standards in the hands of accomplished, trained, and well-paid teachers. We must create a program that grants every family universal access to pre-k, because we know that educational inequity cements itself before most children step foot in a classroom. All high school graduates must be prepared either for further education or to enter the workforce with an employable set of skills. The state’s long-term prosperity hinges on Maryland’s high school graduates being college-bound or career-ready.
The 16 community colleges across the state educate almost 150,000 full-time students and about 500,000 students in total25. Maryland’s community colleges educate 50% of all undergraduate students in the state of Maryland26.
Those who receive a degree from a community college earn nearly 20% more annually than those who stopped their education after high school27. Our community colleges must be the best in the country and they must be accessible to all Marylanders. They should be tuition-free for any student with a family income that is less than 150% of the statewide median household income. The state of Maryland should also apply the community schools model to a college context. My administration will provide wrap-around services, like health care, child care, and social services so that all Marylanders can capitalize on the community college model.
Community colleges serve the important function of providing students with the skills they need to start a career, but they also serve as an affordable stepping stone for students who eventually earn their bachelor’s degrees. Nationally, about 40% of students who earn a bachelor’s degree begin their higher education at a community college28. When I served on the Board of Regents for the University System of Maryland, we focused on developing relationships between community colleges and universities in the system. In fact, we even created some programs within particular universities that granted community college students automatic admission if they reached certain benchmarks. From 2008-2012, the number of transfers from community colleges to schools within the system increased by 25%29. I will bring this proven track record of success to the Governor’s Office.
Apprenticeship programs, including those provided by unions, need to be supported and expanded. Apprenticeships combine supervised on-the-job training with related classroom instruction and are a cost-effective means of receiving training while also earning a living wage and receiving health insurance and other benefits. I will promote partnerships between businesses, community and technical colleges, unions, and the government. This four-way partnership will encourage educational attainment, economic development, and workforce development.
They will provide a financial benefit not only for the apprentice, but for employers and the state. I will work to eliminate regulatory barriers that prevent employers from developing desperately needed apprenticeship programs. I will implement a much simpler and consistent method of funding apprenticeship sponsors by, for example, providing direct incentives to businesses that adopt a program. I also will ensure that outcomes are measured by looking to whether apprentice workers earn meaningful industry credentials, rather than whether they put in the bare-minimum number of hours. Finally, I will streamline the application process to our state-sponsored programs so that the complexity of enrollment does not get in the way of apprentices or sponsors.
Our workforce development programs will focus in particular on those who lose their jobs because of automation or globalization. We will sponsor, develop, and implement re-training programs in these areas specifically. My experience as Chair of the Empower Baltimore Management Corporation, a $350 million federal economic development program, taught me that job training, especially when customized for particular business needs, is a very effective means for re-employing displaced workers, or for enabling many to upgrade their opportunities for better paying jobs30. I will work with the community colleges to provide training classes for displaced workers so they can update their skills and compete in the 21st century economy. As I have travelled the state, I have not met a single person who is not willing to learn, work, and contribute. The state must give everyone a chance to succeed. As in all ventures – public and private – accountability is crucial. I will work to ensure that the community colleges and vocational and apprenticeship programs are actually providing students with the skills they need to succeed and employment opportunities, and I will provide public information regarding the success of the programs so that prospective participants are fully-equipped with information as they make their decisions.
Our superb colleges and universities, including our HBCUs, will produce proficient graduates ready to play leading roles in our global economy and will be funded appropriately. Increasingly, the schools in the University System of Maryland will operate as a unified system, with far greater collaboration between schools, while providing distinctive programs of professional or technical training. All of these programs will align with the present and anticipated needs of employers in the state. The educational community will review teaching methods and educational content to achieve this alignment. The business community must be a partner in the endeavor of training Marylanders for good-paying jobs, playing a role in the development of work-relevant curricula and committing to hire graduates. We will measure our progress by tracking the number of students who enroll in and graduate from these programs and then obtain employment. We will track graduates’ post-graduate success to gain further insight into what works and makes a difference in the real world.
As a business leader and a frequent advisor to businesses, Chair of the Downtown Partnership of Baltimore and the Empower Baltimore Management Corporation, and a 20+ year member of the Greater Baltimore Committee, I know the business community in Maryland well. I also know the educational community from my ten years on the University System of Maryland Board of Regents, including four years as its Chair. In my first six months in office, I will work with leaders from the education and business communities to produce specific plans, with measurable objectives, to accomplish these goals that directly link the worlds of education/training and business. I will challenge both the business and education communities to form a true partnership. I will insist that they coordinate on curriculum development. I will ensure that the costs of training and re-training are shared fairly and that a good education turns into a real job.
Investing in Infrastructure
Infrastructure investment for the common good is a central function and responsibility of the state government and a key tool for growing the economy. Well-conceived infrastructure investments yield projects that produce jobs, stimulate economic activity, and increase tax revenues. As Governor, I will begin by commissioning an expedited and comprehensive review of the state’s infrastructure needs. The review will operate on two tracks: one that looks at our current infrastructure to see what needs to be upgraded, and another that looks for opportunities to make new infrastructure investment to drive the state’s economy. A cursory examination points to the fact that our roads and bridges need significant upgrading, our state needs substantial investment in public transit options, and the power, water, and sewer lines need updating. However, we first need to know precisely what the needs are, and then prioritize and plan to address them.
Every Marylander is acutely aware of the inadequacy of our state’s transportation system. My understanding of Maryland’s transportation problems and their solutions has been sharpened by my ten years as Chair of the Central Maryland Transportation Alliance (CMTA), a coalition of businesses, labor, and non-profits advocating for a relief from traffic congestion. That experience will inform decisions about our investments in our state’s transportation system. For parts of each day, many of our state’s major roads look more like parking lots than highways. Marylanders are wasting tens of thousands of hours over the course of a year sitting in traffic. Maryland has the truly dubious distinction of having some of the worst traffic, with the longest delays, in the entire country31. The problem will only get worse unless we act.
Businesses want to attract workers from different parts of the state, with diverse backgrounds and strengths. Without a public transit system that enables people to get to jobs in different parts of the state or across the D.C. suburbs and Baltimore City, our economic prospects dwindle, businesses cannot thrive, and opportunity is denied to people solely because they cannot get to where the jobs are. The ability of people to get to jobs quickly, safely, and reliably combats income inequality, economic stratification, and soaring housing prices32. Further, businesses want to grow in areas that provide their workers with a high quality of life. Working to find a solution to our state’s woeful traffic problem will help improve the quality of life – thus making Maryland a more enjoyable state to live in and helping to attract businesses.
Governor Hogan is on the wrong side of transportation issues. He cancelled the Red Line in Baltimore, forfeiting almost $1 billion of federal money and losing the opportunity to build a much-needed project which would have generated jobs and been a source of long term social and economic benefit. This east-west transit link would have provided a lifeline enabling people in East and West Baltimore to get to jobs, school, and other activities as well as being an essential part of a larger metro transit plan. An extended Red Line would have provided the platform for future development of effective area-wide transportation infrastructure. Those opportunities have been lost. Governor Hogan and his administration sat on the sidelines for over a year after they were notified that the Baltimore Metro was in an unsafe condition, putting the lives of Marylanders at risk and refusing to make necessary transportation infrastructure improvements in the Baltimore region33.
I will offer an alternative to the Red Line that facilitates travel between East and West Baltimore and creates a framework that can support a full metro system in the city and surrounding area. I will also prioritize transit between Washington, D.C. and Baltimore by upgrading the MARC system to improve speed and reliability. I will oversee the completion of the Purple Line and ensure that it is well integrated with the MARC lines. On the Eastern Shore and Western Maryland, I will work with local jurisdictions to find alternatives that reduce congestion. All of these ideas are explained more extensively in my Transportation Plan.
The Port of Baltimore is a core infrastructure asset in the state. The Port should be an engine of growth and a job generator for decades to come. Its facilities need to be maintained and continuously improved to attract the large ships that can now travel through the Panama Canal.
The state of Maryland must work to make the Port of Baltimore as competitive as possible so that, when ships are weighing where on the East Coast to dock, they choose Baltimore. The Port of Baltimore is the westernmost port on the East Coast, providing it with a competitive advantage. We must capitalize on this advantage and create additional infrastructure that will grant the port greater shipping capacity. While several types of cargo move through the Port, containers and automobiles dominate the Port’s business. We need to broaden the base of the Port’s customers. We will set growth targets for new product lines and measure carefully the rate of growth in these lines. We know that not only do infrastructure projects at the port improve competitiveness, but they also create jobs. The expansion of the Seagirt Terminal, for example, did just that. The state of Maryland projects that this investment was directly responsible for significantly more tax revenue, $140 million in new dollars for transportation improvements, and 5,700 new jobs34.
Other infrastructure projects across the state can help grow the economy and make Maryland a more attractive place to grow a business. In Washington County, the Hagerstown Regional Airport has driven economic growth in the area. The airport supports about 1,500 jobs, and it generates about $100 million in salary and wages and $10 million in local tax revenue. Further, local businesses receive nearly $136 million in revenue due to the airport’s growing presence35. As Governor, I will work with the local jurisdictions to find creative ways to grow the airport’s reach to bring more good-paying jobs and revenue to Western Maryland.
In Southern Maryland, the largest employer is NAS Patuxent River and related contractors. I will collaborate with the federal government, St. Mary’s County, and the Southern Maryland Navy Alliance (SMNA) to further establish NAS Patuxent River as a military leader and major employer. The federal government may initiate a Base Realignment and Closure any year. The state of Maryland must do whatever it can to support the St. Mary’s County economy, and NAS Patuxent River itself, to ensure that it is unthreatened, and, in fact, grows. We must make sure that the local communities can support additional forces, missions, and personnel. In this instance, targeted and efficient road and bridge construction projects can play an important role. The Thomas Johnson Bridge carries tens of thousands of vehicles per day, but it is one way in each direction and carries a far greater load than was initially designed and anticipated36. Further, I will, along with Senators Cardin and Van Hollen, be a fierce advocate for NAS Patuxent River. We will advocate for additional federal funds to fix the crumbling sea wall, gates, and hangers. And, we will work with all interested parties to bring new missions to the base.
Maryland’s water and sewer system have been neglected. When these systems fail, pipes burst, streets are flooded, and neighborhoods are damaged. All of this disrupts daily lives and regular business activities. There is no political glamor in replacing aged water pipes, but doing so is an essential element of the business of government. When government fails in its responsibilities in this area, when we just kick the can down the road, the economy suffers. Baltimore is currently under a consent decree for water infrastructure, but it is an unfunded mandate37. President Trump talks a big game when it comes to infrastructure, and Governor Hogan should use that to advocate for additional federal resources to update our aging water infrastructure. Governor Hogan is, unfortunately, once again silent.
As we move further into the 21st century, the very definition of infrastructure is changing. Access to broadband is crucial if Marylanders are expected to compete. Maryland is currently the eighth most connected state. It is my goal for Maryland to reach number one. About 257,000 Marylanders lack access to high-speed broadband. Further, 350,000 Marylanders have access to fewer than two providers. And, most inexcusably, 146,000 Marylanders are without any access to wired internet providers38. We laid the spine to give every Marylander access to high-speed broadband, but we need to finish the “last mile.”
The state government’s information technology infrastructure is itself sorely in need of upgrading and modernizing. This is an economic development issue. The state government’s ability to support continued inclusive growth, including that of high-tech companies, is hampered by its inadequate information technology systems. State agencies need to review all of their practices which currently require the use of paper hard copies with the goal of replacing paper with electronic filings and submissions. Businesses should be able to apply for all licenses electronically, and electronic filing with all state agencies (as well as courts) should be the norm, not the exception.
In some instances, it may be appropriate to help finance infrastructure projects using public-private partnerships and, when applicable, user fees. However, when we are using public-private partnerships, we must ensure that we are implementing consistent accountability standards so that the partnerships do not turn into large-scale corporate handouts. We need to be both more creative and sophisticated about the financing of infrastructure projects by recognizing that delaying needed projects does not avoid costs; it increases them. This increase occurs in two ways. First, the cost of the project itself will be greater in future years than it is today because of increases in labor and material costs and, in many instances, because delay will mean the scope of needed repairs is greater than it is today. Second, unmaintained infrastructure is a drag on economic activity. When workers are in traffic, not at work, and when parts and materials are on trucks stuck in traffic, not in the hands of manufacturers, the economy suffers. Deferred maintenance leads frequently to the closing of facilities because they break down and that, in turn, hurts economic activity and ultimately increases costs. There is, perhaps, no better example of this than the month-long closing of the Baltimore Metro, which not only put people’s lives at risk, but disrupted commutes and the flow of commerce. Further, Maryland commuters who routinely use the Washington, D.C. Metro are aware of the effects of deferred investments as they frequently must account for delays and cancellations. There are serious public safety risks associated with bridges, or Metro Systems, that are structurally unsound.
When we build infrastructure projects, we are not just spending money; we are investing in our state and its people. We are building a stronger state in which people may enjoy a better life and a higher standard of living. With all of these pressing infrastructure needs, we need to prioritize them based on safety considerations and getting the greatest economic development bang for the buck. At the same time, we need to be nimble and prepared to seize funding opportunities when they appear as in the case of the Red Line. Unfortunately, in that instance, Governor Hogan inexplicably blundered his way to the wrong decision and cost the state nearly a billion dollars in federal funds.
Small Businesses and Start-ups
Small businesses and start-ups are the lifeblood of any state’s economy, and Maryland is no different. There are about 550,000 small businesses in Maryland, and they employ over 50% of the state’s private workforce39. Any economic development plan that does not address ways to continue to support the creation and growth of small businesses and start-ups is incomplete. Frederick is a perfect example of the power of small businesses and start-ups. The county’s and city’s economic growth over the past decade is not tied specifically to any one employer. Instead, it has facilitated the growth of small-businesses and start-up companies.
One of the most significant impediments that small business owners face is a lack of access to capital40. Most small businesses rely on commercial banks, and that source of capital has not fully recovered from the 2008 recession. Venture capital and the big banks are often looking for the next billion-dollar business. The state of Maryland should be looking to support the small businesses that often struggle to receive funding from the same sources. A 2016 study from CNBC listed Maryland as just 15th in access to capital41. As former Chair of the Empower Baltimore Management Corporation, I am acutely aware of this hurdle for so many small businesses, particularly in disadvantaged areas. The federal program included $100 million for grants, and a revolving loan program still exists today to provide capital to small businesses. The reality is that more work needs to be done. As Governor, I will work to bolster the grants and loans that the state currently provides to small businesses. I will coordinate with the robust non-profit community in the state to align their interests with those of small businesses. I will try to bring outside resources, like the $10 million from Goldman Sachs and Bloomberg Philanthropy that will help grow small businesses42. And, I will ensure that the state of Maryland serves as a central hub that small business owners can go to for information regarding potential grants and loans.
The state of Maryland should also encourage coordination and collaboration between small businesses, research institutions, and industry leaders. As Chair of the University System of Maryland, one of my focuses was the commercialization of the university system’s research. UM Ventures, which began in 2012, has seen significant results in the growth of invention disclosures and start-ups43. The 2020 Strategic Plan targeted the formation of 325 new companies, and the University System of Maryland exceeded that goal by supporting the creation of 451 as of December 201544. The UM BioPark is another example of a successful program that has created hundreds of jobs and generated hundreds of millions of dollars in capital investment. In 2017, the Association for University Research Parks named the UM BioPark the Outstanding University Research Park of the Year45. The state must support these ventures and serve as a key conduit that helps to commercialize the groundbreaking research that is happening right here in Maryland. Along with our prominent research universities, the assets of federal research and military institutions, like NAS Patuxent River and the NIH, present a great opportunity to facilitate tech transfers to grow the local economy.
Unnecessary regulations and red tape significantly burden an economy, and they take a particularly harsh toll on small businesses. Small businesses do not always have the resources to comb through thousands of pages of state regulations to get a permit or comply. As Governor, I will work to strike the proper balance that protects businesses that do things the right way while also limiting any undue burden. I have run a business and I have advised dozens of businesses of all sizes and at all stages of development. I have represented businesses and other entities before state regulatory bodies. I understand the needs, expectations, and problems of regulated entities in their dealings with government. We want businesses to thrive. There is no tension between that goal and the goals of worker safety, protection of consumers, or environmental protection. We need a regulatory climate in which businesses can operate and new businesses can be born, all while respecting these interests. A large part of this undertaking will involve updating the state’s IT systems. Everything that a founder needs to start a business should be readily available online with easy to use interfaces and step-by-step instructions.
Finally, the state of Maryland should be the biggest and most powerful promoter of our businesses. The state should work to connect Marylanders to homegrown businesses so that, as we move deeper into the 21st century economy, Main Street continues to thrive. To do this, I will launch a statewide effort to promote our small businesses. We will have a dedicated “small business month” during which the state government highlights the successes of small businesses in Maryland. We will use new digital platforms to boost small businesses across the state. We will also create an easy-to-navigate website that connects Marylanders to their local small businesses.
Energy, Agriculture, and the Environment
Maryland’s energy and agriculture sectors are integral components of the state economy. Agriculture itself is the largest commercial industry in Maryland and it remains the largest single land use in the state, with roughly one third of the land area in the state used for farming46. Maryland is a leader in the production of corn, milk, honey, and wine, and the equestrian, poultry, and fishing industries in Maryland support good-paying jobs. The agriculture industry not only employs tens of thousands of Marylanders across the state, but it also provides a steady supply of food. As Governor, supporting our farming economy in all of its rich diversity will be a central focus of mine.
Currently, the University of Maryland, Eastern Shore’s School of Agriculture and Natural Sciences provides students with a robust agricultural education47. As does the School of Agriculture and Natural Resources at College Park48. The Center for Agribusiness and Economic Development at UMES, which was created in 2016, has and will continue to lead the way on agriculture research and development49. Not only will I work to support these programs, but I will also expand agribusiness educational opportunities in our state’s high schools and community colleges. Local businesses will partner with community colleges and high schools to provide a comprehensive education to students who want to move into the industry. The curricula at each of these levels should complement each other and be crafted to prepare Marylanders for long-lasting and fulfilling careers in agriculture. And these institutions will lead in developing the agricultural techniques that will define the 21st century. Already, some form of precision agriculture is being used on every grain farm in Maryland50. However, the state of Maryland, along with farmers and research universities, can do more to make the technology more readily available across the state.
Those who work in Maryland’s agricultural economy also need additional resources so they can stay up-to-date with the newest laws and protections. As Governor, I will direct my Secretary of Agriculture to bolster the department’s outreach programs to engage the agriculture community with emails, newsletters, training sessions, and town halls to give them the information they need. The University of Maryland Extension, which has an office in every jurisdiction in the state, is another source of information for Maryland’s farmers51. The state can do more to connect citizens to the UME.
Just like other industries, agriculture, particularly family farms, needs a seat at the table. Annapolis must be responsive to the needs of the largest commercial industry in the state. I will work with them to streamline the permitting and state approval process. I will also continue to prioritize land conservation to promote the needs to family farms and the horse industry so that they are not lost to development and urbanization. I will work to expand and promote the state’s farmers’ markets and community gardens. Just like the state should be doing more to promote Maryland’s small businesses, the state should also be doing more to promote and market both the products of the farms and the robustness of our farming economy.
Many skeptics say we cannot foster growth in our agriculture communities and protect our precious natural resources. I believe that is a false trade-off. We can encourage growth in the agriculture sector without compromising our commitment to protecting the environment. Farmers are our partners in conservation. Some of the larger agricultural industries, including our fishing community, rely on a healthy environment to make a living. They have a vested interest in the quality of the soil, water, and air in our state. The fact that parts of the Eastern Shore are at risk of being inundated by rising sea levels is a serious threat to the agriculture industry in Maryland52. Environmental laws protect the farmers and businesses that do it the right way. In industries that do cause environmental degradation, we will work with and reward innovators who are willing to make the leap to more sustainable practices. The institutions that I noted above will lead the way in conducting groundbreaking research that develops environmentally friendly agriculture practices. This process will be a part of my plan to bolster Maryland’s clean energy economy.
To create a clean energy economy, Maryland must invest in renewable technology. As Governor, I will target a 50% renewable portfolio standard by 2030, with the ultimate goal of getting to 100%. Reaching these goals will take hard work and commitment from both public and private entities. We must incentivize and reward those who are leading the industry in renewable technology production. We also must eliminate incentives in our system that reward non-renewable energy sources, including trash incineration and black liquor. These changes will help align the priorities of a green economy with our state’s incentive structure.
In order to significantly increase the renewable portfolio standard, we must expand energy storage capacity and limit the costs. Renewable energy is crucial, but it is not consistent. Sometimes the wind is blowing too slowly or too fast for wind turbines to produce energy. And sometimes it is cloudy, so solar panels are not producing energy. Conversely, sometimes there is an excess of wind or solar energy, yet not enough capacity to store it. As a society, our energy use is also inconsistent. The sporadic supply of renewable energy and demand for energy makes energy storage crucial. As Governor, I will work to expand the incentive that is given to those who install energy storage systems. I will emulate California’s tactic of setting targets for utilities to procure cost-effective storage systems. While we invest in energy storage capacity, we must ensure that all communities have access to affordable storage options. Expanding our storage capacity, and incentivizing new research and development of storage opportunities, is both an environmental imperative and an economic opportunity. The fact remains that a green economy is the future, and the state should be a leader in producing the energy, and the jobs, of the future.
Investing in infrastructure creates jobs, but it also helps to protect the environment. New infrastructure developments, from Leadership in Energy and Environmental Design (LEED) construction to roads and buildings that limit damage from storm water runoff can protect the environment. Pipes that carry gas and waste need to be upgraded, maintained, and continually monitored. And, our current transportation infrastructure plans, which will increase the number of cars on the road, will pollute the air we breathe and the water we drink. Developing a multi-modal and integrated public transit system will create jobs, reduce congestion, and protect our environment. As Governor, that is exactly what I will do.
Reexamine Financial Incentives
Financial incentives in Maryland, including grants, low interest loans, tax credits, and abatements are economic development tools available to state and local governments. However, we are overly reliant on tax breaks rather than using them as one part of a larger arsenal to attract and grow businesses. In order to ensure that we are spending the taxpayers’ money efficiently and effectively, we must develop a much more robust system for examining and tracking financial incentives.
During a hearing with State Senators, Transportation Secretary Pete Rahn said that the Hogan Administration will “provide whatever is necessary to Amazon when they need it” in order to bring their second headquarters to Montgomery County. He then followed up his comments noting that “for all practical purposes, it’s a blank check.” In the same meeting, Rahn noted that he does not know how the administration would pay for the corporate handout53. While Hogan backtracked in a political pirouette, this line of thinking is indicative of the administration’s larger economic development philosophy.
As Governor, I will partake in a drastically different process. I will study each case on its merits and agree to provide incentives only if they are necessary. I will develop a consistent and easily-applied process to determine when the state will award financial incentives to businesses. The following considerations will be crucial to this decision-making process:
- What are the true and total costs of the financial incentive to the state in loss of tax revenue or increased expenses?
- What is the actual economic benefit derived from the incentive in terms of the creation of good-paying jobs, not just the business’s revenue?
- Will the economic activity or growth occur without the financial incentive?
- Does the cost-benefit analysis indicate this project is worthy of state support?
- Could the lost state money be used for other more economically productive or beneficial causes?
- Will the incentive create good-paying jobs in economically disadvantaged areas to combat inequity?
Developing a system like the one outlined above will ensure that the taxpayers’ money is being used efficiently and effectively. As Governor, I will develop a revamped accountability process for the state’s business incentives. Whenever an incentive is granted, the Department of Commerce will outline the expected costs and returns. Then, on a yearly basis, the department will report the results to ensure that the incentive is generating the economic value and number of jobs that were originally expected. The department will also calculate a ROI Index for the state’s financial incentive system to measure which incentives are performing well as a way to make the process more efficient. As much information as possible will be available to the public.
As a society, we have shifted our focus to attracting big businesses from out of state rather than growing businesses that are already here by investing in the state and its people. Poaching only accounts for about 2% of job creation in any one state54. The vast majority of jobs are created by the growth of businesses that are already here. Revamping the financial incentive system in Maryland will go a long way in ensuring that our economic priorities and tactics are in line with results on the ground.
Measuring Results and Assuring Accountability
An economic development plan for the state is crucial, but the plan is only as good as the results it achieves. As Governor, I will be held accountable for my administration’s results and provide the proper context to the progress we make. I will develop quantifiable objectives and measure our performance against those objectives. Accountability requires that there be transparency in the entire process. That is, there must be public disclosure in advance of an objective (say, for example, exceed national wage growth rates in 2019), and then public discourse of whether the objective was met, and if it was not, what the barriers were. Public officials, and the Hogan Administration, do not partake in this process. They let the chips fall where they may, and then they pinpoint specific statistics to try to convince the public that they are succeeding.
This is no way to run a government, nor is it a way to maximize economic development. The firm which I led for more than two decades achieved strong results – including record growth in 21 of my 22 years in leadership – because we set concrete objectives and executed. The firm then measured its performance against those objectives. The state government needs the same discipline. Further, the public is entitled to know what its government is doing and how it is performing. That means knowing what those objectives are and whether those objectives are met.
As Governor, I will ensure that all of the state’s economic data is presented clearly and concisely online so that Marylanders across the state can observe our progress. I will also put the data into the proper context – both the national context and regional context – to provide more clarity on how we are performing. I will regularly appear at economic town halls across the state to hear directly from the citizens of Maryland. Not only will these town halls put a consistent face on the economic development numbers, but Marylanders will also be able to advocate for their own ideas on how to create jobs and boost wages.
Accountability is crucial for two reasons. First, as I addressed above, especially with public institutions, the public has a right to know how the government is performing and whether their tax money is being spent wisely. Second, holding government, and thus government employees, accountable makes a government more efficient. Throughout my career, whether I was chairing the University System of Maryland or Venable, I have learned that accountability is a fundamental pillar of an efficient organization. That is partially how, at the University System of Maryland, through the Effectiveness and Efficiency Program, we saved hundreds of millions of dollars for the system and the state55. I will bring those ideals and that system to our entire state government.
Maryland is far from an average state, but that is where we fall now in education and economic development. It is not that our students are getting worse or our workers have become less productive. It’s that our state government has not kept up with the changing dynamics of the economy and has failed to properly invest. When I am elected that will change. I will build an economy from the bottom up and the middle out. I will create good-paying jobs across the state so that families can save for retirement, pay for higher education, and put quality food on the table. I will build on our strengths, returning Maryland’s public education system to its rightful place at the top of the rankings and making it world class. I will invest in our state’s infrastructure. Creating a state government that is more responsive to the needs of small and start-up businesses will be a priority. Our state’s agriculture and energy sectors are crucial for our economy of today and tomorrow. I will protect our environment and expand these sectors to create good-paying jobs for Marylanders. And, I will reexamine financial incentives to make sure taxpayers’ money is being spent wisely and create a system of accountability to make our state government more responsive and efficient.
Throughout my career, I have led large public and private organizations. As the Chair of the University System of Maryland, the Empowerment Zones in Baltimore, the Central Maryland Transportation Alliance, and Venable, I was successful because I developed a plan, outlined clear goals and standards, executed, and measured results with a rigorous system of accountability. As the Governor of Maryland, I will create jobs and boost wages for the people of our state by adhering to the same time-tested process.
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¹⁶“Preliminary Report.” Commission on Innovation and Excellence in Education. January 2018. http://msa.maryland.gov/megafile/msa/speccol/sc5300/sc5339/000113/022400/022461/20180014e.pdf.
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⁵²Heim, Joe. “National Study Puts Timeline on Impact of Sea-Level Rise in Maryland and Virginia.” Washington Post. 14, July 2017. https://www.washingtonpost.com/local/national-study-puts-timeline-on-impact-of-sea-level-rise-in-maryland-and-virginia/2017/07/14/c3c4fd6e-67d8-11e7-a1d7-9a32c91c6f40_story.html?utm_term=.d1fa37815a53.
⁵³Katherine Shaver. “Maryland Transportation Chief Pledges ‘Blank Check’ to Clinch Amazon’s HQ2.” Washington Post. 6, February 2018. https://www.washingtonpost.com/news/dr-gridlock/wp/2018/02/06/maryland-transportation-chief-pledges-blank-check-to-clinch-amazons-hq2/?utm_term=.e68c5c16acd3.
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