FacebookTwitterRedditEmail

Corporate Welfare in Maryland

At this time of severe cutbacks in government funding for food stamps, early childhood education, and meals on wheels, some Maryland legislators are hard at work looking out for the welfare of one of the world’s wealthiest corporations.  Under a bill rapidly advancing in the legislature of that state, the Lockheed Martin Corporation will have the taxes on its luxurious Montgomery County hotel and conference center reduced by approximately $450,000 a year and will also receive a $1.4 million refund for the period since 2010.

Lockheed Martin would seem to be an unlikely recipient of this lavish government handout, at least on the basis of need.   Indeed, it is one of the world’s largest business enterprises, with sales that reached $47 billion in 2012.  It is also America’s largest defense contractor, and in fiscal 2012 its U.S. military sales topped $29 billion.

The effort to shovel millions of additional taxpayer dollars to this giant corporation goes back to 2010, when the state legislature passed a bill that exempted Lockheed Martin’s hotel guests from paying the state hotel tax.  Then, in 2011, the company asked to be exempted from the 7 percent hotel tax levied by Montgomery County, a suburb of Washington, DC.  Accordingly, the Montgomery County Council reviewed a bill that would change the definition of a hotel to exempt Lockheed Martin from this tax, too.  Nevertheless, after citizen testimony at a public hearing, the County Council refused to rewrite the law.  As a result, patrons of the hotel, grandly named the Center for Leadership Excellence, are forced to pay a lodging tax, just like patrons of all the other hotels in the county.

It should be noted that, when Lockheed Martin’s employees stay at the hotel, the company can usually pass on the costs to the appropriate federal contract.  Thus, in most cases, the federal government already compensates Lockheed Martin for any hotel tax it pays.

Lockheed Martin's hotel and conference center.

Lockheed Martin’s hotel and conference center.

In 2012, Ike Leggett, the County Executive, spearheaded a new effort to subsidize Lockheed Martin by proposing that the corporation be given a no-strings “grant” of $900,000 to compensate it for the hotel taxes it paid in 2011 and 2012.  But the county’s legislative analyst suggested that providing such a grant, without any information as to the extent to which the company had already been reimbursed by the federal government, would not be advisable.  Ultimately, the County Council refused to allocate the grant to Lockheed Martin.

Lockheed Martin maintains that its conference hotel is a “private” facility, solely devoted to training its employees, and for this reason its guests should not have to pay the tax.  And it is true that Lockheed Martin decides who can reside there.

But the 183-room hotel is not, in fact, limited to Lockheed Martin employees.  It is available for contractors, vendors, and anyone else the company welcomes.  For example, the business school of the University of Southern California held a conference there in October 2012, with attendees offered the option of staying at the hotel for $225 per night or finding their own accommodations.  Benchmark Hospitality International, which manages the facility, advertises it online as “a private, full-service business-class lodging and conference center,” with a sports bar, fitness facility, lounge, and other amenities.

Faced with the unwillingness of the County Council to provide a multi-million dollar giveaway to this giant corporation, Lockheed Martin and its local enthusiasts have turned to the Maryland State Legislature for assistance.  Senator Nancy King, the chief sponsor of the new bill, argues that it is necessary to keep the Lockheed Martin hotel operating — although she has not specified why a corporation with $47 billion in revenues cannot manage this feat on its own.  She has acknowledged that, under the legislation, Lockheed Martin will be the only company throughout the State of Maryland that qualifies for the exemption from the hotel tax.

With the bill for tax exemption and a refund already approved by a Maryland Senate committee, it seems likely that the bill will be brought to the Senate floor for a vote on March 11.  Maryland’s House of Delegates will consider it thereafter.

Citizen activists, especially from Montgomery County, are outraged by what they are calling the “Corporate Welfare for Lockheed Martin” bill.  One of their leaders, Jean Athey, terms it “blatant corporate welfare for one of the wealthiest, most profitable companies in the nation.”  She asks:  “Why, in a time that WIC supplements for babies and pregnant women are being cut, when children are being deprived of Head Start, when unemployment benefits are being reduced . . . should one of the wealthiest companies . . . receive this kind of special tax favoritism?”

It’s a question well worth considering.

Lawrence S. Wittner is professor of history emeritus at SUNY/Albany. His latest book is “Working for Peace and Justice: Memoirs of an Activist Intellectual” (University of Tennessee Press).

More articles by:

Dr. Lawrence Wittner is Professor of History emeritus at SUNY/Albany and the author of Confronting the Bomb (Stanford University Press.)

bernie-the-sandernistas-cover-344x550
August 26, 2019
Paul Street
“Hereby Ordered”: On Trump, Capital, Fascism, and China in a World on Fire
Marshall Auerback
Trump Never Had a Grand Strategy for China: They Were Just Tariff Tantrums
Jacques R. Pauwels
The Hitler-Stalin Pact of August 23, 1939: Myth and Reality
Robert Fisk
The Fourth Afghan War is About to Escalate
David Macaray
The Death of Political Satire
ADRIAN KUZMINSKI
Flying the Flag
Binoy Kampmark
Imperial Sentiments: Donald Trump, Greenland and Colonial Real Estate
Medha Kale
‘Everything has Turned Upside Down’ in Sangole
Jim Furnish
Trump Administration Proposal to Roll Back Logging Rules is Reckless
Robert Koehler
Participatory Evolution
Mel Gurtov
Trump and the Climate Crisis–a Crime Against Humanity
Jerome Irwin
Oil Pipelines and a Climate Crisis Warning from the Haida
David Stansfield
The Chosen One
Taylor Cabatu
Plan B
Elliot Sperber
The Amazon or Amazon
Weekend Edition
August 23, 2019
Friday - Sunday
Paul Street
Notes on Inauthenticity in a Creeping Fascist Nuthouse
Andrew Levine
Recession Now, Please
Rob Urie
Mr. Trump Goes to Kensington
Jeffrey St. Clair
Deep Time and the Green River, Floating
Robert Hunziker
Earth 4C Hotter
Kenneth Good
Congo’s Patrice Lumumba: The Winds of Reaction in Africa
Pete Dolack
The Realism and Unrealism of the Green New Deals
David Rosen
The White-Nationalist Great Fear
Kenn Orphan
The War on Indigenous People is a War on the Biosphere Itself
L. Michael Hager
What Netanyahu’s Travel Ban Has Revealed
Ramzy Baroud
Jewish Settlers Rule the Roost in Israel, But at What Price?
Evaggelos Vallianatos
Is Environmental Protection Possible?
Josue De Luna Navarro
What It’s Like to Grow Up Hunted
Ralph Nader
They Don’t Make Republicans Like the Great Paul Findley Anymore!
Gary Olson
Whither the Resistance to our Capitalist Overlords?
Dean Baker
On Those Downward Jobs Revisions
Rev. William Alberts
Beware of the Gun-Lover-in-Chief
Helder F. do Vale
Brazil: From Global Leader to U.S. Lapdog
Laura Finley
Educators Actually Do “Work” in the Summer
Jim Goodman
Farmers Need a Bill of Rights
Tom Clifford
What China’s Leadership is Really Worried About: Rising Debt
Daphne Wysham
Saving the Planet Means Fighting Bipartisan Corruption
Tierra Curry
Amazon Fires Put the Planet at Risk
Nyla Ali Khan
Kashmir: Decentralize Power and Revive Regional Political Institutions
John W. Whitehead
American Apocalypse
George Wuerthner
How Agriculture and Ranching Subvert the Re-Wilding of America
Daniel Murphy
Capital in the 21st Century
Jessicah Pierre
400 Years After Slavery’s Start, No More Band-Aids
Kim C. Domenico
Finding the Comrades: Maintaining Precarious Sanity In Insane Times
Gary Leupp
“Based on the Fact She Won’t Sell Me Greenland, I’m Staying Home”
FacebookTwitterRedditEmail