The Upper Shore Regional Council, along with the Mid-Shore Regional Council, Tri-County Council for the Lower Eastern Shore, Tri-County Council for Southern Maryland and the Tri-County Council for Western Maryland and the Rural Maryland Council have requested an amendment be made to Senate Bill 180 and House Bill 173, titled, InvestMaryland.
As you are aware, InvestMaryland encourages the development of public-private partnerships to fuel venture capital investment and grow the state’s knowledge-based industries. It is expected to stimulate up to $100 million in venture capital investments and create thousands of jobs.
The Regional Councils and the Rural Maryland Council are concerned that the vast majority of investments resulting from this legislation will be made within the urban and suburban core of the state between Baltimore and Washington, D.C. The Eastern Shore, Western Maryland and Southern Maryland will likely not benefit from this legislation in any appreciable manner. To help ensure that our Maryland communities have the same economic development opportunities that other areas will have through InvestMaryland, we propose that the bill be amended to provide that 12.5% of the revenues raised through InvestMaryland be appropriated to the Rural Maryland Prosperity Investment Fund (RMPIF). The RMPIF was authorized in 2006 after the General Assembly recognized the dire need for more state investment in our uniquely challenged rural areas. The proposed amendment will match the 12.5% set-aside for minority/urban small business financing in the InvestMaryland legislation as introduced.
To date, the RMPIF has never received an appropriation. It was authorized as the economy began to deteriorate and such investment became fiscally impossible. However, rural areas have continued to struggle with low employment, high poverty rates and crumbling infrastructures. As the economy begins to improve and the state begins to create new economic development opportunities like InvestMaryland, it must not forget its rural communities and the tools it already has in place to make targeted investment that will help address these persistent developmental needs.
The overall objective of the Rural Maryland Prosperity Investment Fund is basically the same as that proposed in the InvestMaryland legislation, but targeted to rural areas. It creates an environment for retaining and creating jobs that leads to economic prosperity. RMPIF will expand economic opportunity, build local and regional capacity, leverage or augment development funding from other sources, engender private investment in rural-serving projects and programs, and improve/protect the rural quality of life. It will also promote intergovernmental cooperation in rural regions as well as public/nonprofit collaboration on community projects and service delivery. And it will support entrepreneurial activity, help small or fledgling businesses succeed and develop regional infrastructure.
For these reasons, the state’s five Regional and Tri-County Councils, which represent 15 of the state’s 18 rural counties, respectfully request that InvestMaryland be amended so that 12.5% of the revenues raised through InvestMaryland be appropriated to the Rural Maryland Prosperity Investment Fund (RMPIF). We believe that doing so will ensure that the legislation stimulates economic development across the entire State of Maryland.
Currently, more than 25% of the state’s population lives in the state’s 18 designated rural counties located in the Western, Southern and Eastern Shore regions. Many of these communities, especially in the more remote regions, have higher rates of poverty and unemployment and lower rates of income and educational attainment than their metropolitan and suburban neighbors. Six rural Maryland counties currently qualify for the state’s distressed jurisdiction economic development assistance program due to especially high unemployment rates. Many rural communities face a host of difficult challenges relating not only to persistent unemployment and poverty, but to an aging population and an out-migration of youth, an inadequate access to quality housing, health care and other services, and a deteriorating or inadequate physical infrastructure. Local governments, educational and health care institutions, and private nonprofit service providers in rural areas are struggling to respond effectively to all these growing challenges.
The Rural Maryland Prosperity Investment Fund would provide grants and business reinvestment funds to organizations, local governments, and institutions of higher education who are working in support of four specific areas:
(1) Rural regional planning and development assistance, by targeting support to the state’s five rural regional planning and development councils and other multi-county economic efforts. The rural regional councils over the last six years have leveraged a modest state investment totaling about $8.4 million in operating funds to nearly $186 million in other funding sources such as federal and philanthropic funds for economic development projects and programs;
(2) Rural entrepreneurship development, including programs and activities undertaken by nonprofit organizations and institutions of higher education. Many rural economic development professionals are increasingly embracing entrepreneurship as an effective strategy for growing the tax base, expanding economic opportunities, and creating sustainable local economies in communities where citizens are typically poorer, older and more isolated from markets. Unfunded programs such as the Maryland Rural Enterprise Development Center and the Eastern Shore Entrepreneurship Center would be eligible to apply for important rural business development aid;
(3) Regional infrastructure projects that directly involve two or more units of local government, not to exceed 25 percent of the total cost of any particular project. These projects could include multi-jurisdictional water, wastewater, transportation, workforce housing, health care and commercial/ industrial facilities – the big ticket items that small communities often do not have the financial ability to address on their own; and
(4) Rural community development, programmatic assistance, and education, with funds to be divided equally between the existing Maryland Agricultural Education and Rural Development Assistance Fund (MAERDAF), which supports rural-serving agricultural and community development nonprofits, and the Rural Maryland Council, a federally recognized State Rural Development Council which functions as a statewide rural program and policy development coordination entity.
RMPIF would be administered by the Rural Maryland Council, an independent state agency which operates on a nonpartisan, collaborative basis, and consensus-oriented manner in providing assistance to rural communities and industries. RMPIF grants would be awarded on a competitive basis by the existing MAERDAF Interagency Grants Review Board. This Board is made up of representatives from six state agencies, including the Departments of Agriculture, Business and Economic Development, Housing and Community Development, Health and Mental Hygiene, and Natural Resources as well as the Rural Maryland Council. The MAERDAF Interagency Grants Review Board has been successfully awarding grants since 2001.
I will try to reach all of you over the next few days to discuss this proposal and would greatly appreciate your thoughts and suggestions.
Thank you, John
John A. Dillman III
Upper Shore Regional Council