A Baltimore-based consulting group released an economic analysis claiming Montgomery County is in a “downward fiscal spiral” with little to no job growth in recent years.
The report, which was released Friday at a County Executive Democratic candidate forum, paints a bleak picture of the County’s economy claiming if leaders do not change their policies to be more pro-business, the standard of living in the County will dramatically decrease.
“If Montgomery County keeps persisting in this way from the perspective of economic progress the standard of living will decline,” said Anirban Basu, chairman and CEO of Sage Policy Group, the consulting firm that published the study.
The report cites an increasing poverty rate, an aging population, a shrinking tax base and stagnant economic growth, indicating that the County is in serious economic trouble. Among the main data points Basu points are a loss of 12,500 private sector jobs from 2006 to 2016 and the 13.2 percent office vacancy rate as signs of slow economic growth.
In addition from 2011 to 2016 the County has only added six new business establishments, making the pressure felt from the increasing poverty rate and public school enrollment as well as the aging population even great for the County.
Basu admitted the County has a lot of potential with pointing to the affluence and high levels of education of many of its residents, but said County regulatory environment has been hostile to businesses, making people “jump through hoops” of regulations in permitting to start or expand businesses.
The County’s elected leaders have pushed back.
On Monday both County Executive Ike Leggett and Council President Hans Riemer, criticized the study, saying Basu “cherry-picked” data to push a false narrative about the County’s perceived hostility to businesses.
“I think this was sort of cherry-picked to reflect a crisis that doesn't exist on order to enhance election of business oriented candidates,” Leggett said.
Leggett pointed to the County’s AAA bond rating from Wall Street’s three main ratings agencies – Moody’s Investor Service, Standard & Poor’s and Fitch Ratings – its $500 million in reserves and 3.2 percent unemployment rate as signs the County’s economy is not in peril like the study said.
Riemer also said he was skeptical of the Basu’s report, saying the report was commissioned with the intent to push the narrative that Montgomery County is anti-business in some way.
“There is a lot of selective use of data – right. Data that if you combine four or five points seem to create a version of reality that is really a very distorted version of reality and is not an accurate portrayal overall.”
While Basu was critical of the way the County government’s attitude toward business, he said Montgomery County has a lot of assets that a business is looking for when it chooses to relocate somewhere, calling the County the international gateway to the Washington Metropolitan Region.
Basu also admitted that if Amazon, which put Montgomery County on a list of 20 potential destination for its new headquarters, locates to the proposed site at White Flint with its reported 50,000 new jobs, many of his concerns about the County’s economic future will be allayed.