This is hardly the time for Prince George's County officials to be searching for a policy on economic development, and they had better settle on one soon. Failure to do so could cost the county dearly.

The slowdown in the national economy will almost certainly lead to a resumption of aggressive campaigns by economic development agencies across the country to attract new business in attempts to stimulate growth in their respective jurisdictions.

In metropolitan Washington, where the slowdown is having a noticeable effect on economic growth, we certainly can expect to see a renewal of efforts to land business prospects and create more jobs.

It's imperative, in fact, if local governments hope to maintain acceptable levels of economic growth and significantly reduce the huge supply of empty commercial space that continues to accumulate.

Prince George's County could find itself desperately trying to catch up with its neighbors again if county officials don't soon resolve differences over how economic development programs should be conducted.

Regarded for years as the backwater of metropolitan Washington, Prince George's County languished while other area jurisdictions enhanced their growth through aggressive economic development programs.

Prince George's closed the gap considerably in recent years, however, thanks to the adoption of an enlightened policy on economic development.

As reported earlier, the county council voted to slash more than $300,000 from the $1.3 million budget that had been proposed for the Economic Development Corp., a private nonprofit body that was created to run the county's economic development program.

Opinion continues to be sharply divided over the council's action, which supporters of EDC say will hurt the county's ability to maintain a comprehensive economic development program.

In 1983, county officials decided to abolish the office that handled economic development and transferred the agency's employees and functions to EDC, a quasi-government organization created for that purpose.

With an annual grant from the county as the principal source of funding, the EDC staff and its nonsalaried board of directors from the private sector are responsible for carrying out an economic development program approved by the county executive.

The private sector's involvement in EDC has generally been regarded as a major factor in the county's dramatic gains in economic development. Indeed, the innovative public-private partnership was cited in the 1986 All-American City award presented to the county.

Council member Sue V. Mills, a longtime critic of EDC, remains unimpressed. She not only questions the job EDC is doing but insists that the council's original intent -- to allow EDC to become self-sufficient after it received an initial grant -- has been ignored.

"The seed money not only became an annual grant but has increased," Mills fumed. What's more, she bristled, "They pay high salaries to a small number of people. There's a lot of hanky-panky going on in that group and it's nothing to be proud of.

"I really don't know of any business or development {the EDC} has brought to the county," Mills sniffed. "I really don't think they've had any influence on development in the county."

Other critics haven't gone quite that far, but question EDC's effectiveness nonetheless. That, however, is a matter of interpretation and -- perish the thought -- politics as usual.

Business growth in the county these past few years was no mere accident. Clearly, developers and other investors didn't just happen to stumble onto investment opportunities in Prince George's County.

Nor did they all choose to go there because they ran out of development sites and investment opportunities in other jurisdictions.

Someone in the county had to have been actively involved in recruiting or assisting those businesses at some point.

For what it's worth, the EDC says it answers inquiries or requests for assistance from at least 2,500 business prospects each year.

What's more, EDC says it helped firms obtain $11 million in loans in the first three months of the current fiscal year and assists at least 500 companies annually in locating or expanding in the county.

Numbers aside, the flap over EDC that began as a tempest in a teapot need not develop into a storm that could prove severely damaging to the county. Even Mills concedes as much. "I'm rather astounded by all the hoopla," she volunteered. "I think it's a simple matter to be resolved."

Mills is absolutely correct on that point. Almost no one in business or county government has said economic development should be abandoned, though some EDC critics have shown an amazing lack of knowledge about how successful economic development programs work -- whether they're run by government or non-government agencies.

"I think when you wade through the rhetoric many of the council members don't have a commitment to use tax dollars to fund economic development," observed EDC Chairman Lance Billingsley. "I think one of the obstacles we have to overcome is to get the council to buy into the notion that the public sector has a public purpose here" in funding economic development.

Even though they differ sharply over the respective roles of the public and private sectors in funding economic development, Billingsley and Mills really aren't that far apart.

Mills wants the council to "follow our original intent" in providing one-time funding for EDC but says, at the same time, "I have no problem considering a change."

For his part, Billingsley doesn't want the matter "to evolve into a finger-pointing situation because the county will be the loser."

There already has been too much finger pointing. If only someone will stop long enough to propose a change that ensures funding at a reasonable level for economic development in the county.

The alternative is to become a loser, as Billingsley fears.