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Harford council approves business loan opposed by Campaign for Liberty

BY BRYNA ZUMER, bzumer@theaegis.com

3:39 PM EDT, July 12, 2012

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Spurred by a Campaign for Liberty drive, a handful of residents opposed a Harford County Council bill giving an Edgewood company a loan, calling it "crony capitalism."

By a 5-1 vote, the council Tuesday night approved a $750,000 economic development opportunity loan to British-based Smiths Detection Inc., whose U.S. headquarters are on Lakeside Boulevard in Edgewood.

The bill includes a workplace training grant of $100,000 for the company.

Jim Richardson, Harford County's Economic Development Director, said the company primarily creates chemical and biological detection systems and has been operating in Harford County since 2002.

An e-mail sent by the Campaign for Liberty the same day noted Smiths Detection is a "multi-billion dollar company that manufactures TSA-used body scanners."

The bill is "basically payola to a foreign corporation," Scott DeLong, a Campaign for Liberty member and vice-chair of the county's Republican Central Committee, said. DeLong said Smiths Detection has received millions in federal contracts.

"Just because other states are willing to put out their taxpayer money for companies doesn't mean it's something we should be doing," DeLong said.

"This proposal seems like something Donald Fry, [Governor] Martin O'Malley's chief bagman, would come up with," he said, referring to a former Harford state senator and current president of the Greater Baltimore Committee.

"This government-business cronyism is leading us down the road to democratic socialism," he said. "This is hardly the time to hand out cash from the taxpayers of Harford County."

Several other residents also questioned the need for the whole economic loan program, criticized the company's production of airport body scanners and said a multibillion-dollar corporation hardly needs the county's money.

Lowell Sheets, of Forest Hill, said the program creates a situation in which the government determines the winners and losers, and the winners will be "the rich and well-connected."

"Corporations are in bed with the federal government, in bed with the state government and perhaps the county government," Sheets said.

"The power to tax is the power to destroy," he said. "All these kinds of subsidies basically only help large businesses and hurt small businesses."

Del. Glen Glass also opposed the loan and explained that Republican Central Committee chairman Patrick McGrady, who was not at the meeting, has been leading the opposition to the resolution.

"I just feel like this whole thing has been rushed and there hasn't been enough time to thoroughly research this," Glass said, explaining he also led the fight against TSA searches and body scanners in the legislature.

"This whole deal makes me uncomfortable and I feel this process has been rushed, and there needs to be more time to vet this properly," Glass said.

Richardson, the county economic development director, defended the program in anticipation of the opposition.

"This supports jobs. This is a jobs bill. This is true jobs coming to Harford County, in the manufacturing sector," he said, noting it is in Edgewood, "a critical area that we're very interested in continuing seeing to grow."

"We are in a competitive market. I know there's a lot of discussion about these loans and the government's role in these loans, but we are in a competitive market," Richardson continued. "We're not even close to matching some of these packages that could be offered to a company like this in another state, in another region."

The company would add 103 jobs, with average salaries of $74,000, to its existing stock of 220 jobs.

It recently expanded its Edgewood operations to 240,000 square feet.

Richardson also said he sees the company's growth as a major boost to Edgewood.

"I have very high expectations for Edgewood," he said. "Edgewood is ripe for a complete renaissance and expansion, and I think this company particularly is one of the [keys] for that expansion and that growth."

In answer to a question from Councilwoman Mary Ann Lisanti, Richardson confirmed that the $750,000 can only be used for the building costs.

Councilman Chad Shrodes also noted that without the council's support, the county will lose the $750,000 coming from the state in support of this program, as the program is in conjunction with the state department of economic development.

Councilman Joe Woods did not like the idea of supporting the deal, "especially [for] a foreign company."

"It just keeps getting harder and harder for me to vote on these every time," he said, adding he would like to see local companies benefit from the deal first.

"If they're sending money out, especially when it says out of the country, I just have a hard time doing that," Woods said.

Richardson defended the accusation that this is a foreign company.

"While they are a British-owned firm, this is the U.S. headquarters for Smiths Detection," he said.

"All of the management people are U.S. citizens, have to be U.S. citizens, so I consider it as much a U.S. company as it is a foreign company," he added.

Tucker McNulty, of the economic development office, also noted this is a matching grant program, which over the years has affected 75 Harford County companies.

"The portfolio of the program is pretty broad," he said. "It wasn't a program created for this very reason. It's an existing program that is utilized across a broad range of industry."

Councilman Dion Guthrie said he supports the proposal.

"To get business, you have to invest in business. That is the bottom line," Guthrie said. "I think this is a good project."

He said those who spoke in opposition would maybe prefer to have all these products made overseas and have them shipped here, so the U.S. does not get any jobs or benefits.

Guthrie noted the companies that have received economic loans have spent a lot of money moving their facilities here.

"I just don't see the negative on this at all," he said. "If you oppose this, you oppose our warfighters."

"Freedom is not free, and this is what you have to pay for it," Guthrie added.

Lisanti said the program is not a new state or county program, the rules and regulations are well-enumerated and the program is open to any business.

"This entire council has voted to fund this program," she said. "This is not a bill on whether to have this program."

"The issue of whether to support this program is a budgetary question," she added.

Lisanti said she visited Smiths Detection many times because, until this year, it was in her district.

"There is no doubt in my mind that they protect the life and liberty of American citizens, domestically and abroad," she said, explaining the item they make is a tiny object the soldier wears to detect chemical or biological agents.

"They know how to protect our soldier from their desktop," she said, adding she is "so glad" she goes through a metal detector when she flies.

"The technology has become such that 10 years ago this unit was in the back of a Humvee and it was strategically located around battlefields, in cities," Richardson said. "They have been able to microtize these to the point that they're able to give every soldier the ability to have these on their uniform as a battery-operated pack."

Councilman Chad Shrodes said the economy needs jobs to return and the county's young people need opportunities for jobs without leaving Harford's borders.

Councilman Jim McMahan noted the council just created a program creating an "angel fund" that is aimed at small businesses.

Woods disagreed, saying the company does not need the money and giving the example of the business he and his wife recently opened, a military and police supply company in Bel Air.

He said when they started looking for employees, they got plenty of interest.

"I have an $8 an hour job. Forty-five people applied for two positions. I think that says a lot," he said.

Woods was alone in voting against the bill. The council was still being headed by vice-chair Dick Slutzky in the absence of Council President Billy Boniface, whose son was killed in a motor vehicle accident last month.

Slutzky said he has tried to stay on top of the news and listen to "both sides of the aisle" of national debates.

"On both sides of the aisle, the mantra is, has been and remains, 'jobs, jobs, jobs. Help businesses, businesses, businesses; they provide jobs,'" he said.

Slutzky said he got a comment from "one of our astute" staff members earlier, asking: "Have you ever had a poor person offer you a job?"

He said "people who are willing to take the risk, who are willing to hire people" are the ones who will ultimately produce jobs and the ones governments should support.

Also at Tuesday's meeting, the council approved ballot language for the recently-reviewed charter amendments and introduced resolutions to provide community investment tax credits to the Harford Community Action Agency, FISH and the Humane Society of Harford County.

The council approved a transfer of $1.3 million in board of education capital projects, from six heating and air conditioning projects at various schools to one project for roof and major heating and air conditioning repairs at Ring Factory Elementary School.

The council appointed Matthew Combs as student representative on the disabilities commission, Phillip Hunter to the social services advisory board and Mary Lou Olszewski, John Kane Jr. and H. Leroy Whiteley Jr. to the property tax assessment appeal board.

Rose Ann Eimer and John Bowman were reappointed to one-year terms on the Harford Center board of directors; Helen Chapman and Walter Littlefield were reappointed for three-year-terms.