2018 | Bethesda Beat

Q&A With County Executive Candidate Marc Elrich

This is the first in a series of interviews with the three contenders

Marc Elrich

PROVIDED PHOTO

In an interview during the primary, you said you had asked for meetings with local Chambers of Commerce to discuss regulations on business deemed overly burdensome, and contended they had never responded. Three heads of local chambers subsequently wrote a letter to the editor saying they had met with you and provided such information. Who’s in the right here?

I met with the chamber, but, most of the time when the chamber comes in, they don’t have a specific list of things to look at. I asked them to put together a meeting with business owners who come to them, and to facilitate that meeting for me. Those meetings never happened. I wanted to hear from the people who are actually dealing with what they feel is a broken system, and talk to me about it. I guarantee you that, when I’m executive, I will set up this committee, and I’m sure they’ll volunteer. They should want me to do that.

For the business community, there are two big initiatives I want to undertake. The first is benchmarking Montgomery County’s environment against our neighbors. People keep saying it’s so hard to do business in the county. I’ve had friends tell me they’re going to go to Frederick County or Howard County. So what I’ve [said to] people is “Tell me what I require in Montgomery County if I’m starting a business, tell me what they do in Frederick, Howard and Fairfax, and if we’re doing something different, I would guess we probably don’t need to do it.” So I want that kind of take from people—and then let me fix it.

The second thing I want to do is a review of the permitting process. Some stuff is just too slow. And we’ve got to deal with the issue of when somebody gets an inspection. If another inspector comes out because the first one doesn’t do the second inspection, [the permit applicant] might be asked to do different things.  There’s no way that if you’ve gotten something approved, that [inspectors] should be able to have such different interpretations of it that people wind up having to do work they thought they already did.

Doesn’t part of the widespread complaint that Montgomery County is not business-friendly go beyond regulations, to taxes?

There’s been such a myth over the years about how Montgomery County out-taxes everybody. When you examine it, it’s not true. But it’s the big lie—you repeat it over and over again, and it becomes true.

Fairfax County doesn’t have an energy tax. They have a 3 percent gross receipts tax only on businesses. So Fairfax raises $161 million dollars off the business community; our energy tax raises $191 million from anybody who pays an energy bill in Montgomery County. I guarantee you the business community is not paying $161 million of our $191 million—they’re paying far less than that. And when people say, “You’ve got this terrible tax and Fairfax doesn’t have this,” I say, “Fine—I’ll swap. Let me have the gross receipts tax, and I’ll get rid of the energy tax. You OK with that?” No, they’re not OK. So Fairfax can do stuff that we can’t do, but they want us to get rid of anything that we do that Fairfax doesn’t do.

I had a conversation with a [local developer] and said: “I know what you pay over there [in Fairfax County]. It’s at $1.67 [per $100 of assessed value] before the gross receipts tax and Montgomery County is at $0.98, so tell me how I’m overtaxing MC developers?” And he said, “It’s not the business taxes, it’s the piggyback tax—you have to get rid of the piggyback tax.” [Editor’s note: The county’s income tax “piggybacked” on the state income tax.] He said a certain very prominent developer is going to move his family to Fairfax County, so they pay less. So what they say is that it’s about business taxes, but what it’s really about is the income tax they pay in Montgomery County. You’re not going to get much sympathy about the piggyback tax if you’re a gazillionaire—we all pay it.

In discussing your vote for the 2016 property tax increase during the primary, you cited the need to fund increased reserves following the Great Recession under pressure from those who underwrite public bonding. As county executive, would you seek discussions about lowering these reserves to devote more resources to county programs?

It’s a double-edged sword. The truth is that if we hadn’t been required to go to 10 percent reserves, we would have long ago been able to restore services in the county without any tax increases. But, having lived through the Great Recession, and watched 6 percent reserves turn into zero, I know that 6 percent was inadequate.

The [Washington] Post [editorial page] pulled [my comments] out of a questionnaire that was ironically, asked by [the pro-business group] Empower Montgomery. [The questionnaire] suggested they believed these reserves were too high, because they don’t want to pay taxes … . You need to do risk-based analysis, and you may well discover your reserves are too low. And this is what I told the Post, which they promptly ignored.

We really do need to do a proper analysis. We need to look at not just what other jurisdictions do, but what is the tax base of other jurisdictions. Some jurisdictions that have a sole source tax base may have a higher reserve, because if they take a hit in one source, it may have disproportionate impact. If you have multiple sources of revenue, you may have a more balanced tax picture. I’m not looking to lower the reserves, I’m not looking to raise them. But I am looking to make sure we understand what and why we’re doing what we’re doing—and that it’s supported by data.

What steps are needed to increase the stock of affordable housing in this county, particularly for those who work here but can’t currently afford to live here?

I’ve voted for every [measure] to increase the required amount of affordable housing. Even when I voted against the Bethesda [2017 sector] plan, and any other plan, I voted for increasing the amount of affordable housing to 15 percent [of proposed units for large residential developments]. What I opposed in the Bethesda plan is exactly what the Planning Board said not to do, which is do not take existing affordable housing on Battery Lane and Bradley Boulevard. The last push by Nancy [Floreen] to rezone all of the existing affordable housing in order to get 17 percent [of new dwelling units classified as moderately priced] would have resulted in a loss of affordable housing.

There’s a really important role for market rate affordable, because market rate affordable is not that high in apartments in Bethesda; it’s this space where people who are not really poor but who aren’t wealthy enough to rent a $6,000 apartment can find a place. Because they’re older buildings, they’ll never command the rents of the new buildings, so they provide this reservoir. This is like the missing middle, and housing experts will tell you don’t get rid of your existing stock of affordable housing.

I’ve argued really hard about maintaining existing affordable housing. I did the same thing in Long Branch when they proposed getting rid of all of the affordable housing. It was the same thing in White Oak: You were going to displace all these people, and … have no place else to put them in Montgomery County. I won both those fights—so I’ve saved thousands of units of affordable housing that the Planning Board otherwise would have eliminated.

To relieve congestion on I-270, you’ve advocated reversible lanes. Do you think this can be accomplished within the current footprint of that highway? And what’s your view of adding toll lanes to I-270 and I-495?

Yes, there’s a solution right now where you can get a lane in both directions on I-270 today. There’s an interior service road, next to the barriers—there are tons of roads, including the Beltway, that don’t have a service road on the inside. You could take that service lane out tomorrow, and, with a little bit of grading … they could add a lane [on the main highway] within months. I’ve talked to the state and asked, “Why don’t you start by doing this?” Put a lane both ways right now, and you would certainly break traffic … . On the highway, that’s probably 2,000 cars an hour that can come off the other three lanes.

When it goes down to two lanes [north of Germantown], you add the third lane back in. You’ve got a median strip to do it in, and you’re not going to touch any houses. The problem with four lanes is that it’s not so simple: All of a sudden, you’re taking out bridges … because they were built for the road kind of the way it is.

Toll lanes bother me because you make them expensive enough that they’re free-flowing, which minimizes the improvement for everybody else. Everybody else paying taxes is still sitting in a congested roadway. I pity those people coming in on I-66: Those tolls are going to be extraordinary. If you’ve got the money to spend that much a day, good luck. Most of us don’t have that kind of money.