Click amount to donate direct to CounterPunch
  • $25
  • $50
  • $100
  • $500
  • $other
  • use PayPal
Please Support CounterPunch’s Annual Fund Drive
We don’t run corporate ads. We don’t shake our readers down for money every month or every quarter like some other sites out there. We only ask you once a year, but when we ask we mean it. So, please, help as much as you can. We provide our site for free to all, but the bandwidth we pay to do so doesn’t come cheap. All contributions are tax-deductible.
FacebookTwitterGoogle+RedditEmail

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.)

October 16, 2018
Gregory Elich
Diplomatic Deadlock: Can U.S.-North Korea Diplomacy Survive Maximum Pressure?
Rob Seimetz
Talking About Death While In Decadence
Kent Paterson
Fifty Years of Mexican October
Robert Fantina
Trump, Iran and Sanctions
Greg Macdougall
Indigenous Suicide in Canada
Kenneth Surin
On Reading the Diaries of Tony Benn, Britain’s Greatest Labour Politician
Thomas Knapp
Facebook Meddles in the 2018 Midterm Elections
Muhammad Othman
Khashoggi and Demetracopoulos
Gerry Brown
Lies, Damn Lies & Statistics: How the US Weaponizes Them to Accuse  China of Debt Trap Diplomacy
Christian Ingo Lenz Dunker – Peter Lehman
The Brazilian Presidential Elections and “The Rules of The Game”
Robert Fisk
What a Forgotten Shipwreck in the Irish Sea Can Tell Us About Brexit
Martin Billheimer
Here Cochise Everywhere
David Swanson
Humanitarian Bombs
Dean Baker
The Federal Reserve is Not a Church
October 15, 2018
Rob Urie
Climate Crisis is Upon Us
Conn Hallinan
Syria’s Chessboard
Patrick Cockburn
The Saudi Atrocities in Yemen are a Worse Story Than the Disappearance of Jamal Khashoggi
Sheldon Richman
Trump’s Middle East Delusions Persist
Justin T. McPhee
Uberrima Fides? Witness K, East Timor and the Economy of Espionage
Tom Gill
Spain’s Left Turn?
Jeff Cohen
Few Democrats Offer Alternatives to War-Weary Voters
Dean Baker
Corporate Debt Scares
Gary Leupp
The Khashoggi Affair and and the Anti-Iran Axis
Russell Mokhiber
Sarah Chayes Calls on West Virginians to Write In No More Manchins
Clark T. Scott
Acclimated Behaviorisms
Kary Love
Evolution of Religion
Colin Todhunter
From GM Potatoes to Glyphosate: Regulatory Delinquency and Toxic Agriculture
Binoy Kampmark
Evacuating Nauru: Médecins Sans Frontières and Australia’s Refugee Dilemma
Marvin Kitman
The Kitman Plan for Peace in the Middle East: Two Proposals
Weekend Edition
October 12, 2018
Friday - Sunday
Becky Grant
My History with Alexander Cockburn and The Financial Future of CounterPunch
Paul Street
For Popular Sovereignty, Beyond Absurdity
Nick Pemberton
The Colonial Pantsuit: What We Didn’t Want to Know About Africa
Jeffrey St. Clair
The Summer of No Return
Jeff Halper
Choices Made: From Zionist Settler Colonialism to Decolonization
Gary Leupp
The Khashoggi Incident: Trump’s Special Relationship With the Saudi Monarchy
Andrew Levine
Democrats: Boost, Knock, Enthuse
Barbara Kantz
The Deportation Crisis: Report From Long Island
Doug Johnson
Nate Silver and 538’s Measurable 3.5% Democratic Bias and the 2018 House Race
Gwen Carr
This Stops Today: Seeking Justice for My Son Eric Garner
Robert Hunziker
Peak Carbon Emissions By 2020, or Else!
Arshad Khan
Is There Hope on a World Warming at 1.5 Degrees Celsius?
David Rosen
Packing the Supreme Court in the 21stCentury
Brian Cloughley
Trump’s Threats of Death and Destruction
Joel A. Harrison
The Case for a Non-Profit Single-Payer Healthcare System
Ramzy Baroud
That Single Line of Blood: Nassir al-Mosabeh and Mohammed al-Durrah
FacebookTwitterGoogle+RedditEmail