Leggett: New Economic Report Cherry-Picked Data To Frighten Voters
The Montgomery County executive responded Friday to statistics presented in a Sage Policy Group report that suggested the local economy was struggling
Montgomery County Executive Ike Leggett
Andrew Metcalf, file photo
County Executive Ike Leggett pushed back Friday against the findings detailed in a Sage Policy Group report, saying the report chose data that painted a picture of a languishing local economy when other factors—such as low unemployment and the county’s sterling bond rating—tell a different story.
“The purpose of the report is designed to frighten voters into the belief that there is a crisis in our local economy,” Leggett said of the report formally released Friday. He added that he believed the goal of the report, which was funded by the pro-business nonprofit group Empower Montgomery, was to try to convince people to “more fully embrace business-oriented candidates” in the upcoming June 26 primary.
The report pointed to a lack of creation of new businesses, the county’s 13.2 percent office vacancy rate and declining average incomes as signs of stagnation in the local economy. On Friday morning, Sage Policy CEO Anirban Basu told a crowd gathered for a forum featuring Democratic county executive candidates in Rockville that while the county is home to attractive communities, a quality education system and a highly educated workforce—there are issues.
“Underneath that gloss of prosperity lies a host of emerging challenges,” Basu said. “Poverty is on the rise, the population is aging, business formation has come to a virtual halt, job growth [is] erratic, debt is marching higher and demands for public services are growing.”
The report concluded the county “is already in the midst of a downward fiscal spiral.”
While Leggett admits there are some issues in the local economy—such as the high office vacancy rate—but he said the problems are not isolated to Montgomery County. Arlington’s nearly 20 percent office vacancy rate led to that county proposing budget cuts and laying off dozens of employees earlier this year. The Metropolitan Washington Council of Governments reported this month that the region’s office vacancy rate is 14.2 percent.
Leggett also disputed the report’s findings by pointing to the county’s AAA bond rating from all three of the top Wall Street ratings agencies—a status bestowed on fiscally prudent jurisdictions. He noted the county has $500 million in reserves and that unemployment is low. The county’s 3.5 percent unemployment rate is lower than the state’s, at 4.3 percent, and the federal rate of 4.1 percent, according to federal and state data.
“If you read this report, you’d compare [Montgomery County] to some of the worst counties in the nation, but look—here’s a county that’s AAA rated by all three rating agencies, that has half a billion dollars in reserves, that is restructuring its infrastructure and has a thriving school system with businesses that are expanding,” Leggett said.
He pointed to recent announcements from biohealth companies about planned expansions as an example of a sector growing in the county. Last month, Gaithersburg-based MedImmune announced it would add 100 new jobs. In January, Novavax announced it plans to add 850 jobs at a new Gaithersburg lab.
Leggett said the Bureau of Labor Statistics data included in the report that indicates just six new businesses were created in the county from 2011 to 2016 only accounts for incorporated businesses. He said most small businesses aren’t incorporated and that the statistic doesn’t include employment growth at existing businesses.
“You’re talking about a subset of a subset—you’re not talking about all the businesses in the county,” Leggett said.
He doesn’t expect the new report to affect the county’s bid to be chosen as the site of Amazon’s second headquarters. The county is one of 20 North American places shortlisted by the company for the project that could bring about 50,000 jobs. He said Amazon officials would be more concerned with Wall Street’s evaluation of the county, its low unemployment rate and highly educated local workforce than the statistics presented in the report.
Leggett also suggested the report may backfire on the pro-business group that financed it.
“You’re dealing with a county [electorate] who is sophisticated and can look through these things,” he said.