Leggett Announces Stimulus Package

Montgomery County Executive Isiah Leggett unveiled a plan yesterday that he said would help jump-start the local economy and boost small businesses during the deepening recession.

The package of proposals, most needing approval by the Montgomery County Council, would expand the pool of businesses eligible for state and federal aid; encourage purchases from more county-based companies; ease permitting for builders and developers; and delay fees builders pay to underwrite services for new homes.

Leggett (D) did not provide a precise calculation of how much the proposal would cost but said it could mean about $50 million annually in lost revenue in a budget totaling about $4 billion. At the same time, he said, the proposals aid local businesses, retain jobs and ensure that tax-paying, revenue-producing companies stay in business.

"This is a very large first effort to make sure that Montgomery County does as much as we can do," Leggett said at a news conference in his Rockville office. "We are no longer immune."

Leggett was flanked by several County Council members, including Council President Phil Andrews (D-Gaithersburg-Rockville), as well as several members of the business community, who praised his plan.

Council member Valerie Ervin (D-Silver Spring), who did not attend the news conference, questioned the possible impact.

"These are not brand-new ideas to stimulate the economy," she said. "I think they will have some minor impact."

Georgette "Gigi" Godwin, president of the Montgomery County Chamber of Commerce, described Leggett's package as more of a "helping hand" than a stimulus plan. "This is a good start," she said.

Leggett's proposal to give developers more time to build -- from five years to seven -- is likely to generate controversy. The Leggett administration used a similar approach in October when it persuaded the council to waive rules to help lure Live Nation's music hall to downtown Silver Spring.

That plan was strongly opposed by the Montgomery County Planning Board, which said Leggett made it too easy for developers to stall their projects and slow down development in Silver Spring, a view Leggett disputed.

The state's economic forecast continues to be gloomy, forcing county government leaders to dig deeper for budget reductions. Leggett asked department heads Wednesday to find $52 million in additional trims to help close a $450 million shortfall for fiscal 2010, which begins in July.

This week, Maryland officials almost doubled the state's projected budget gap to $1.9 billion. Because almost 15 percent of the county's tax revenue comes from the state, "this has troubling implications for Montgomery County," Leggett's chief administrative officer, Timothy Firestine, wrote in a memo to department directors released yesterday.

The memo encourages government managers to "take every possible step" to eliminate all discretionary spending. By Jan. 15, managers of departments not related to public safety, such as those overseeing recreation and libraries, must trim an additional 7 percent from their budgets. The county's health and human services department, police and fire officials must scale back their budgets by 3.5 percent.

Last month, the County Council signed off on a modest package of midyear trims to shrink spending, primarily by delaying hiring and postponing purchases. In this round, Firestine urges managers to eliminate positions and entire programs.

Leggett is also working to secure an agreement from labor union leaders to forego planned pay raises. At yesterday's news conference, Leggett for the first time publicly raised the possibility of layoffs.

"We're going to work hard to make sure it doesn't happen, but it certainly is possible," said budget director Joe Beach.