Opinion: Will Northern Virginia Leave Montgomery County in the Dust?

Opinion: Will Northern Virginia Leave Montgomery County in the Dust?

Across the Potomac, an example of bona fide joint marketing

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Editor’s note: The views expressed in MoCo Politics are the writer’s and do not represent the staff of Bethesda Beat.

Last week saw an ominous announcement: the formation of a new economic development alliance in Northern Virginia.

Ten jurisdictions – Arlington, Fairfax, Fauquier, Loudoun and Prince William counties and Alexandria, Fairfax, Falls Church, Manassas and Manassas Park cities – are teaming up to market themselves to employers. The jurisdictions say they are engaging in “unprecedented cooperation” and will “take advantage of access to more economic development tools, while working together to create a strong brand and story that showcases all of the talent and benefits of doing business in Northern Virginia.”

If these jurisdictions can truly put aside their own rivalries and form a bona fide joint marketing authority, this will be a big problem for suburban Maryland – and especially Montgomery County.

Over the last decade, Northern Virginia’s economy has been steadily pulling ahead of suburban Maryland’s.

The table below shows how D.C., Northern Virginia and the Maryland suburbs compare on a dozen headline economic indicators from the U.S. Bureau of Labor Statistics, the U.S. Bureau of Economic Analysis and the U.S. Census Bureau.

All jurisdictions in the federally defined Washington–Arlington–Alexandria metropolitan statistical area are included. Montgomery County’s performance and relative rank are also shown. (The Bureau of Economic Analysis tracks 19 jurisdictions because it merges 5 Virginia independent cities with their nearby counties while the other two agencies track 24 jurisdictions.)

Economic Indicators Washington Region Asterisk

On these dozen indicators, D.C. led on nine, Northern Virginia led on three and suburban Maryland led on none. On nine measures, Maryland trailed both D.C. and Virginia.

Maryland scored especially poorly on total employment growth, private employment growth and establishment growth. Montgomery County, the biggest jurisdiction on the Maryland side (with the others being Calvert, Charles, Frederick and Prince George’s counties), ranked mostly mediocre or below average.

MoCo’s bright spots were government job creation and mean household income, although the latter is slipping in relative terms as MoCo’s household income is growing slightly slower than the region’s as a whole.

If these were the trends before Northern Virginia’s localities teamed up, what will happen now?

Northern Virginia needs D.C. for three reasons: It is the biggest city in the region, it is the capital of the globe’s most powerful country and it is much better known than Northern Virginia to business leaders around the world.

But Northern Virginia does not need Montgomery County or the rest of Maryland, with the possible exception of labor supply. That’s what the push for the Zombie Bridge over the Potomac is all about: getting Virginia employers more access to Maryland workers. (The statistics above show that Northern Virginia has almost no slack in its labor force.)

If the economic trends above continue, Virginia’s tax base will get stronger with robust commercial growth and intense competition for housing while Maryland gets the leftovers.

Two things of interest to employers are transportation and economic development. How are MoCo and Maryland doing?

Maryland is doing some good things on transportation. Virginia is doing more.

Maryland is building the Purple Line, a worthy project that is on track for completion in 2023. Virginia is building the Silver Line, a Metrorail line that first opened six years ago and will connect to an international airport next year.

Then-MoCo Council Member Marc Elrich first proposed a bus rapid transit system in 2008 and the county is now building its first route on U.S. 29.

Northern Virginia completed its first bus rapid transit route along U.S. 1 in 2014 and has expanded it since. Perhaps not coincidentally, Amazon is placing its second headquarters next to this route. Northern Virginia is now performing a conceptual engineering study of bus rapid transit on Route 7 while Maryland just killed the Corridor Cities Transitway.

Virginia has been building high occupancy/toll lanes on the Beltway, I-95, I-395 and I-66 since 2012.  Maryland’s Washington suburbs have no such lanes, but local elected officials are battling Gov. Larry Hogan’s plan to install them. Whatever problems there are with Hogan’s plan, it’s not clear that anything at all will happen in Maryland.

And finally, a slump in housing construction caused a MoCo capital budget shortfall last winter that resulted in the county eliminating almost all its major new road projects to preserve school construction.

MoCo’s economic development record is worse than its transportation record.

The county has had three economic development organizations over the last decade – the Department of Economic Development (DED), which was abolished in 2015; the Montgomery Business Development Corporation (MBDC), established in 2010 and also abolished in 2015; and the Montgomery County Economic Development Corporation (MCEDC), established in 2015.

DED is best known for having one of its senior managers embezzle about $7 million in county money. MBDC’s former president went to work for Amazon as an economic development official and played a role in selecting Arlington as its second headquarters site.

As for MCEDC, its president has left and no permanent replacement has been picked.

Meanwhile, a County Council staff memo shows that no fewer than a dozen different county entities have a role in economic development. Now, the executive branch intends to create yet another agency, which would be the fourth in 10 years.

Two things are missing on our side of the Potomac.

First, unlike Northern Virginia, we have no sense of regionalism. Montgomery, Frederick, Prince George’s and Howard counties don’t see themselves as a region and don’t work together in any meaningful way on economic development.

Second, other than in Prince George’s County, where County Executive Angela Alsobrooks recently told developers to “get in now,” there is no real urgency around economic growth here. In fact, MoCo followed its housing slump with a partial housing moratorium.

MoCo politicians sometimes even dismiss concerns about the economy entirely.  Last year, the County Council president went on Kojo Nnamdi’s radio show during the primary election, characterized MoCo’s economy as “very strong” and said those who disagree are “upset about taxes they have to pay” and “want us to be more Republican.” He concluded, “This is a good time in Montgomery County.”

Right now, economic development appears to be on the back burner as our leaders pursue other issues.  It needs to be THE number one issue for Montgomery County, as it now is for Northern Virginia. If not, our competitors across the Potomac will leave us further in the dust.

Adam Pagnucco is a writer, researcher and consultant who is a former chief of staff at the County Council. He has worked in the labor movement and has had clients in labor, business and politics.

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