With stiff competition between counties and states to attract or retain companies, offering a $700,000 aid package to a manufacturer of plastic and canvas products as an enticement to remain in the area is not unusual. That's what Howard County in Maryland is offering C.R. Daniels Inc., an Ellicott, Md., manufacturer that wants to expand its operations. The Howard County Council held a hearing on the aid package on Jan. 16. Richard Story, executive director of the Howard County Economic Development Authority, said the Council will vote on whether to apply for the proposed package today.
The proposed aid package would provide $700,000 to the company as a loan with no payment due for two years. If the company hires 70 additional employees, the loan would become an outright grant. The state of Maryland would provide 90 percent of the money and Howard County the other 10 percent.
Story said Daniels has been operating in Howard County for more than 100 years. The county is making an effort to retain the company that employs about 200 local residents, by offering expansion assistance.
C.R. Daniels makes a variety of products, including laundry bags and large canvas bins with wheels for industries such as mail handling. It recently produced more than 8,200 body bags for the Department of Defense.
The company has considered moving to another county or another state to expand its operations. In a telephone interview, Gary Abel, Daniels' president and chief executive officer, declined to comment on the matter, saying that ``It's too premature right now to make any comment on plans the company might have for expansion.''
Abel added that the company is ``extremely diversified'' with plastics products representing only a portion of Daniels' overall product mix.
Story said that Daniels already has obtained the necessary zoning variance for the construction of a 20,000-square-foot addition to the Ellicott plant.
``[Getting this assistance] would be the final step in his process,'' Story said.
Although Council Chairman Darrel E. Drown disapproves of using tax dollars to subsidize businesses, he recognizes that it is necessary in light of stiff competition.
``We've got to do this,'' Drown said. ``If we don't do this, they take a walk.''
Although Howard County jobs grew 4.9 percent from 1993-94, much of that growth has been in the retail sector, typically low-paying jobs that do not lead to substantial income tax gains for the county. Story said manufacturers such as Daniels provide high-end, value-added jobs that result in long-term growth.
Story said the Economic Development Authority operates under an economic development plan in which the primary objective is ``to retain and nurture the business'' already in the area.
``In most economic development strategies, retention is the first thing we look at,'' Story said.