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Don't fear The (Greene) Turtle

BusinessFinanceAbusive BehaviorSmall Businesses

It is not every day that a state senator objects to a business in his district receiving a state-subsidized loan to renovate or revitalize a building. Sen. James Brochin's opposition to a proposed $240,000 loan to The Greene Turtle in Towson rests on one principle — that government shouldn't be in the business of subsidizing business.

"There are many other businesses in my district that are expanding and hiring people that are as worthy as Greene Turtle," Mr. Brochin wrote in an Aug. 14 letter to two of the three members of the Board of Public Works. "They have told me they would love a loan like this, but they believe as I do, that a private business should succeed or fail on their own without a government subsidy."

Such sentiments sound noble. After all, a free market economy is far more efficient than one manipulated by government. But we also long ago recognized that certain aspects of an unfettered free market — abusive child labor, unsafe working conditions or monopoly control of a commodity, to name a few — are not acceptable and require government intervention. Add to this list the tendency of businesses left to their own devices to invest in developing green space rather than redeveloping urban centers.

On Wednesday, the board is likely to approve the loan, which will allow the Greene Turtle to renovate and add a rooftop bar. Comptroller Peter Franchot, a member of the BPW, has already dismissed the project as a "sports bar in an affluent college town." Admittedly, that's not an entirely false description of the circumstances.

But anyone who knows Towson also recognizes that the business district's circumstances are a bit more complicated. Even as certain developments have flourished — the expanded Towson Town Center just a couple of blocks away, for example — the older part of downtown has struggled. Traffic, parking and public safety have all been issues over the years.

Towson wants to be less of a ghost town at night and on weekends. Business leaders have worked hard to promote a walkable and safe downtown. But without government participation, they have doubts that sufficient private investments will be made for that future to happen.

The business of promoting redevelopment isn't always an exact science. Some projects receive such backing and fail, while others flourish (and then cause critics to wonder whether government needed to be involved at all). In Baltimore, Harbor Point has offered that kind of Hobbesian choice — offer a tax credit that will diminish the economic benefits of redevelopment or don't provide one and possibly get no economic benefits whatsoever.

Is the Greene Turtle's plight so desperate? The facts are that the owners, two local families, do not have the collateral to secure financing for the $893,000 project without the state's 26.9 percent participation. As it is, they are tapping retirement accounts and home equity to secure $160,000 in cash and $165,000 in private loans. The rest is coming from county grants and loans to the owners and to the owners of the building.

If the business in question had, instead of a Greene Turtle, been a manufacturer or high-tech company, the loan probably would have been approved without comment. But, as it happens, what Towson really needs is foot traffic — the kind of restaurants, bars, shops and entertainment that complete a robust downtown.

Look at the Greene Turtle's current situation. It is surrounded by vacant and under-performing buildings. The downtown has suffered considerable losses and neglect. If we accept that there's a public interest in keeping downtown Towson economically viable, in encouraging redevelopment and smart growth and creating jobs, why is providing a 3.5 percent loan to reputable business owners who couldn't get financing elsewhere somehow beyond the pale?

One more point. Mr. Franchot and others have also attacked the 18-year-old state program that is providing the Greene Turtle loan. The "Neighborhood Business Works" program offered by the Maryland Department of Housing and Community development has but one purpose — to help small business owners pay for main street redevelopment when they can't secure private financing and thus help historic downtowns prosper.

That program costs taxpayers all of $4 million annually. That doesn't seem like too great a burden to preserve main streets. If anything, one might argue for more such spending in these still-difficult economic times — at least for entrepreneurs who aren't deep-pocketed developers whose intent is to knock down buildings, build high-rises and ignore the charm of historic business districts.

Keep government out of business development? Government licenses, it regulates, it sets standards, it builds needed infrastructure, and it provides a host of other services that make job growth possible. Spending what amounts to budgetary pocket change to keep the older portions of Towson viable hardly seems like a tough vote for the Board of Public Works.

Copyright © 2014, The Baltimore Sun
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