WASHINGTON – Hagerstown Junior College used $1.2 million in federal aid to establish a business “incubator” to help businesses modernize, retrain workers and learn new technology.
The Allegany County Department of Economic Development used $1.9 million in federal funds to develop an industrial park on Kelly Avenue in Cumberland, said Timothy Carney, an economic development representative for the county. The park is being marketed to bring new business to the area.
And a pharmaceutical processing company spent $1.5 million in federal funds to construct an East Baltimore building in which biotechnology companies will conduct pharmaceutical research, said Patrice Cromwell, director of the Maryland Bioprocessing Center.
In all of these projects – and many others throughout Maryland and the nation – federal economic development funds played a critical role, according to officials involved in the operation of the facilities. But due to wrangling in Congress, less federal aid may be available next year. And how that funding is distributed may change significantly.
The House Commerce Committee voted last week to abolish the Department of Commerce, which has been a stated goal of the Republican majority since it took control of Congress in January. The cabinet department includes, among other agencies, the Economic Development Administration, which provides federal funds to states, counties and municipalities.
But another House Committee – the Transportation and Infrastructure Committee – approved legislation that would save the development agency by breaking it up into eight regional commissions by late 1996.
In the meantime, the Senate Appropriations Committee voted to cut funds to the development agency by 75 percent, from $409.6 million to $100 million. The Senate is expected to vote later this week.
Maryland’s top three Democratic officials, Sens. Paul Sarbanes and Barbara Mikulski and Gov. Parris Glendening, last week criticized the Senate panel’s action. The cuts are “the equivalent of eating our seed corn,” Glendening said in a statement.
Sarbanes credited the federal agency with pumping $151 million into Maryland’s economy since it was established in 1965.
Rep. Wayne Gilchrest, an Eastern Shore Republican and chairman of the House Transportation subcommittee on public buildings and economic development, also said he supports continued federal economic development aid, but not from the Commerce Department.
He said he supports a “regional approach” to economic development, which would give states, counties and municipalities greater control over how the money is spent.
Gilchrest’s subcommittee has proposed establishing eight economic development commissions, which would continue to allocate federal funds, said Dan Walsh, Gilchrest’s legislative director. Maryland would be included in a Mid-Atlantic commission, he said.
Each governor would appoint a representative on a board that oversees the regional organization, he added.
Although less federal money would be available from regional commissions, additional funds could be found by eliminating the Commerce Department staff, Gilchrest said.
He said economic development funds helped the University of Maryland Eastern Shore attract additional money for Grumman Corp. to manufacture parts for the F-14 fighter plane.
Republicans have pledged to cut the growth of government, and new commissions and other agencies that might emerge from the remains of the Commerce Department would be “tightly reined,” said Rep. Carlos J. Moorhead, R-Calif., the most senior GOP member of the Commerce Committee.
Rep. Henry A. Waxman, D-Calif., another Commerce Committee member, said he believes President Clinton would win a threatened veto battle with Congress over efforts to kill the department. “The Commerce Department has support,” he said.
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