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.)

Weekend Edition
August 17, 2018
Friday - Sunday
Daniel Wolff
The Aretha Dialogue
Nick Pemberton
Donald Trump and the Rise of Patriotism 
Joseph Natoli
First Amendment Rights and the Court of Popular Opinion
Andrew Levine
Midterms 2018: What’s There to Hope For?
Jeffrey St. Clair
Roaming Charges: Running Out of Fools
Ajamu Baraka
Opposing Bipartisan Warmongering is Defending Human Rights of the Poor and Working Class
Paul Street
Corporate Media: the Enemy of the People
David Macaray
Trump and the Sex Tape
CJ Hopkins
Where Have All the Nazis Gone?
Daniel Falcone
The Future of NATO: an Interview With Richard Falk
Robert Hunziker
Hothouse Earth
Cesar Chelala
The Historic Responsibility of the Catholic Church
Ron Jacobs
The Barbarism of US Immigration Policy
Kenneth Surin
In Shanghai
William Camacaro - Frederick B. Mills
The Military Option Against Venezuela in the “Year of the Americas”
Nancy Kurshan
The Whole World Was Watching: Chicago ’68, Revisited
Robert Fantina
Yemeni and Palestinian Children
Alexandra Isfahani-Hammond
Orcas and Other-Than-Human Grief
Shoshana Fine – Thomas Lindemann
Migrants Deaths: European Democracies and the Right to Not Protect?
Paul Edwards
Totally Irrusianal
Thomas Knapp
Murphy’s Law: Big Tech Must Serve as Censorship Subcontractors
Mark Ashwill
More Demons Unleashed After Fulbright University Vietnam Official Drops Rhetorical Bombshells
Ralph Nader
Going Fundamental Eludes Congressional Progressives
Hans-Armin Ohlmann
My Longest Day: How World War II Ended for My Family
Matthew Funke
The Nordic Countries Aren’t Socialist
Daniel Warner
Tiger Woods, Donald Trump and Crime and Punishment
Dave Lindorff
Mainstream Media Hypocrisy on Display
Jeff Cohen
Democrats Gather in Chicago: Elite Party or Party of the People?
Victor Grossman
Stand Up With New Hope in Germany?
Christopher Brauchli
A Family Affair
Jill Richardson
Profiting From Poison
Patrick Bobilin
Moving the Margins
Alison Barros
Dear White American
Celia Bottger
If Ireland Can Reject Fossil Fuels, Your Town Can Too
Ian Scott Horst
Less Voting, More Revolution
Peter Certo
Trump Snubbed McCain, Then the Media Snubbed the Rest of Us
Dan Ritzman
Drilling ANWR: One of Our Last Links to the Wild World is in Danger
Brandon Do
The World and Palestine, Palestine and the World
Negin Owliaei
Toys R Us May be Gone, But Its Workers’ Struggle Continues
Chris Wright
An Updated and Improved Marxism
Daryan Rezazad
Iran and the Doomsday Machine
Patrick Bond
Africa’s Pioneering Marxist Political Economist, Samir Amin (1931-2018)
Louis Proyect
Memoir From the Underground
Binoy Kampmark
Meaningless Titles and Liveable Cities: Melbourne Loses to Vienna
Andrew Stewart
Blackkklansman: Spike Lee Delivers a Masterpiece
FacebookTwitterGoogle+RedditEmail