Tag Archives: Economic development

Huge Demand for COVID-19 Applications

By Adam Pagnucco.

Montgomery County’s COVID-19 assistance application went live today around 3 PM and demand was both immediate and heavy.

One applicant who completed the county’s form described the process to me as lasting less than 10 minutes. She encountered no problems and said she was “very impressed.”

Another applicant tweeted that he applied roughly 45 minutes after the application went live and was assigned application number 721.

That’s important because, according to the county’s regulations, the first tranche of $10 million will include individual awards of $10,000 each. That implies that only the first qualifying 1,000 applicants will get initial assistance awards. Conceivably, the county could get 1,000 qualifying applications in just a couple hours – or less.

One glitch in the rollout involved an email signup shown on an earlier version of the website. (It’s no longer available.) I signed up a couple days ago and received notification of the application at 4:30 PM. By that point, the queue may have filled up.

Intense interest in assistance will result in the county’s initial funding being claimed RAPIDLY. Those who waited for email notification or other official notice from the county will no doubt raise process protests if they indeed lose out because of application timing.

The process has been far from perfect as I have previously written. But let’s also acknowledge that even with a perfect process, this was going to be very tough sledding.

Expect more of the same!

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Elrich Administration Releases COVID-19 Small Business Assistance Regs

By Adam Pagnucco.

At 9:09 PM last night, I published a post on the county’s $20 million COVID-19 small business assistance program noting that no regulations governing its disbursements had yet been sent to the county council or published for the public. Roughly 20 minutes later, the regulations were sent to the council and forwarded to me by multiple sources almost immediately. The regulations appear below.

There are many details of interest to applicants, who should read every word of these regulations. The provisions that stand out to me are the ones setting aside $10 million for near-term disbursement and reserving $10 million for later. Consider these specific provisions.

Section 4 (b). $10,000,000.00 of funds appropriated for this Program are reserved for businesses or nonprofit organizations that demonstrate Significant Financial Loss. The initial grant award disbursed under this component of the Program is $10,000. The remaining amount of Significant Financial Loss demonstrated by these businesses and non-profit organizations may be disbursed subsequently, subject to the availability of funds.

Section 5(e)(B)(6). Business that have suffered Significant Financial Loss will be eligible for an immediate disbursement of up to $10,000. If the Percentage Decline is 50% or greater, Subtract the Adjusted PHE Revenue from the relevant historical average (Monthly Historical Average for monthly Adjusted PHE Revenue, Quarterly Historical Average for quarterly Adjusted PHE Revenue) to get the Recommended Grant Amount, up to a maximum of $10,000.

Section 5(e)(B)(7). Subtract the Adjusted PHE Revenue from the relevant historical average (Monthly Historical Average for monthly Adjusted PHE Revenue, Quarterly Historical Average for quarterly Adjusted PHE Revenue) to get the Recommended Grant Amount, up to a maximum of $75,000.

Section 5(e)(B)(8). Subject to the availability of funds, once the initial $10,000,000 reserve has been committed, applicants who qualified for more than an initial disbursement of $10,000 and applicants who qualify for a grant that have not received funding will be evaluated and the remaining balance will be disbursed.

And so $10 million will be disbursed sooner and $10 million will be disbursed later. Instead of the full $75,000 maximum grant provided in the legislation passed by the council, applicants will get a maximum of $10,000 in the first round and may get a chance for more money later. When will the second $10 million go out? That’s not clear, but the caveat of “subject to the availability of funds” in Sections 4(b) and 5(e)(B)(8) is not encouraging. Given the volume of paperwork required in the application process, it could take a while.

None of this appears in the legislation creating the program. The council prioritized speed in disbursing the full $20 million it allocated for assistance. The executive branch took twice as long as the District of Columbia to get its assistance program going and now plans to hold back half the money. The council just introduced a new appropriation of $5 million for restaurants and retailers. Given these regulations, what will happen to that money?

The executive branch is not implementing this program in accordance with the legislative intent of the council. The council must take additional action to enforce its will. NOW.

The regulations appear below.

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Fact, Rumor and Chaos on COVID-19 Assistance

By Adam Pagnucco.

The county has announced via press release that COVID-19 assistance for small businesses will be open for application tomorrow (April 15). But questions arise both from the release and what is not in the release.

1. The application process is supposed to open in the “mid-afternoon.” No exact time is given in the press release. Will business owners be refreshing their browsers for hours waiting for the application to go live?

2. According to the press release, “The County will host webinars to answer questions and provide updates on the PHEG program starting at 9 a.m. Mondays through Saturdays. The first webinar will be held on Thursday, April 16.” In other words, the first Q&A webinar will not take place until THE DAY AFTER applications open.

3. As of this writing, multiple sources in the council building report that the council does not have final regulations governing the disbursement of the money. How is the administration going to make decisions on who gets the money? Why have these criteria, in the form of a regulation or otherwise, not been publicly released – or at least sent to the council – prior to the start of applications?

4. The legislation passed by the council authorized grants of up to $75,000. At the time of passage, council members stressed their interest in rapid disbursement. Today, a phone call was held by representatives of the executive branch with representatives of the business community in which some details were shared about the administration’s plans. According to an individual present on the call, “We heard that the 1st wave was the first 1,000 qualified recipients would receive $10,000 as a start. They may receive more later TBD.” Furthermore, only losses in March will be considered and priority will go to businesses with losses of more than $50,000. An earlier requirement that applicants apply for federal and state assistance first has been dropped. So it appears that $10 million will be disbursed first and that $10 million will wait for later – at least as of this writing. If there is indeed a hold on part of the money, why is that? What will happen to it and when will it get released?

This would be a lot easier to figure out if the administration simply released its regulations on how they are making these decisions, or even a simple guidance document. Instead, in the absence of published documentation, rumor rules the day.

Let’s be clear: the executive branch is in a tough spot here. They had to stand up a $20 million assistance program on short notice (although D.C. did the same in half the time). If they disburse small checks to lots of businesses, the money may not be enough to help any of them. If they disburse large checks that might be helpful, MANY businesses will be left out. So there are choices to make.

The problems are that the executive branch is diverging widely from the intent for speed of the legislation passed by the council, is forcing applicants to sit next to a browser and refresh it potentially for hours, is not offering aid for completing the application until the day after it goes live and has not published details of how it intends to spend $20 million.

This process is in need of improvement.

The press release is reprinted below.


For Immediate Release: Tuesday, April 14, 2020

Montgomery County Public Health Emergency Grant (PHEG) Program Applications Will Be Accepted Starting Mid-Afternoon on Wednesday, April 15

Montgomery County will begin accepting applications to its Public Health Emergency Grant (PHEG) program beginning mid-afternoon on Wednesday, April 15. The PHEG initiative is designed to help for profit and nonprofit businesses with 100 employees or fewer during the current public health crisis.

A sample of the application is now available in English and Spanish on the PHEG program web page. The website provides information for businesses on how to prepare their grant applications. The sample applications will guide businesses in pulling together the information and documents required to file their applications.

A fact sheet describing eligibility and document requirements also will be available in Spanish, Amharic, French, Korean, Mandarin and Vietnamese.

The $20 million PHEG initiative is a collaborative effort between County Executive Marc Elrich and the Montgomery County Council. In addition to for-profit and nonprofit businesses, the program is open to businesses with no employees including sole proprietors and independent contractors.

Montgomery County’s PHEG program is intended to provide financial assistance to establishments that have experienced a significant reduction in revenue as a result of the current public health emergency. The County is encouraging businesses and nonprofit organizations to review other assistance programs and apply to those for which they are eligible.

The County will host webinars to answer questions and provide updates on the PHEG program starting at 9 a.m. Mondays through Saturdays. The first webinar will be held on Thursday, April 16. For links and instructions, visit www.montgomerycountymd.gov/biz-resources/pheg.

More information on the PHEG program is available at www.montgomerycountymd.gov/Biz Resources/pheg/. Questions about the program should be directed to BizinfoCovid19@montgomerycountymd.gov.

For the latest updates, visit the County’s COVID-19 website and follow Montgomery County on Facebook @MontgomeryCountyInfo and Twitter @MontgomeryCoMD.

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D.C. Leads MoCo on COVID-19 Grants

By Adam Pagnucco.

As complaints mount on MoCo’s not-yet-functioning process for distributing COVID-19 grants to small businesses, let’s contrast our performance to the District of Columbia.

The D.C. City Council passed a bill creating a $25 million grant program for small businesses impacted by the COVID-19 crisis on March 17. The bill also contains a number of delays on taxes and regulations that were not part of Montgomery County’s relief package, although some similar measures have been adopted by other counties in Maryland.

The D.C. government opened the applications process for the grants on March 24. The applications were closed on April 1.

That means 7 days elapsed between the creation of the program and the start of applications. The total time between creation of the program and the closing of applications was 15 days.

The Montgomery County Council passed a bill creating a $20 million grant program on March 31. On April 8, 8 days later, 7 council members wrote a letter complaining to the county executive that the grant process was nowhere close to being ready. That same day, the county published a document list for the grant process but had no application available.

Today is April 14. D.C. opened its applications within 7 days of its council creating its grant fund. MoCo has gone 14 days since creating its fund and, as of this writing, no applications are online. It has been almost two weeks since D.C. closed its application process and we don’t even have one yet. Small businesses in D.C. had a chance to apply for assistance in time to pay rent and bills due on April 1. Small businesses in MoCo did not have that chance.

What is going on, MoCo government?

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Will County Bureaucracy Strangle Small Business Assistance?

By Adam Pagnucco.

On March 31, the county council passed Bill 16-20E, which established a $20 million Public Health Emergency Grant Program to assist businesses and non-profits with 100 or fewer employees that have been damaged by the coronavirus crisis. The idea behind the bill was to get relief to small businesses quickly before they go under.

Unfortunately, the county bureaucracy may have other ideas.

Yesterday, seven council members released a blistering letter to the county executive slamming the administration for taking too long to implement the grant program. The letter stated in part:

This lack of urgency is beyond disappointing and directly contradicts the Council’s clear intent to get this funding to our local employers as quickly as possible. While the County’s capacity to help may be limited, our ability to move quickly should not be, especially as the level of government closest to our residents and employers. For the businesses struggling to keep their lights on and for the employees who depend on them, this program is only effective if it can get funds out in time to provide help when it’s desperately needed. Without question, that time is now.

We must move with the urgency that this moment requires because our small businesses and nonprofits are counting on us. The only thing that will help businesses right now is getting them the relief money already approved and appropriated by the Council. We urge you to get the Public Health Emergency Grant Program up and running immediately. We cannot afford to wait for some other support to come first. If we fail to act in time, our local businesses won’t be able to afford to stay open. The County Council stands ready to support your administration however we can.

We reprint the letter below.

Shortly after the letter was written, the administration published a required document list for businesses applying for assistance. (As of this writing, the application itself is not finalized.) The documents include a dizzying array of tax statements, bank statements, interim monthly or quarterly financial statements, corporate articles and invoices and quotes for telework software (if applicable) as well as a requirement that businesses verify their good standing on a state website. Most crucially, the document list states in bold: “You must apply for any applicable State and Federal programs to qualify for County assistance.” It then requires applicants to submit “evidence of application to Federal and/or State COVID-19 assistance programs, including award or denial letters.”

There is no requirement in the legislation passed by the council that applicants for county assistance must first apply for state or federal assistance. The council considered an amendment making county assistance “secondary” to state and federal assistance and allowing it to be used as a “supplement” to such aid but decided against it. This requirement has been added by the administration in direct contradiction of the will of the council.

This requirement is of great consequence. When following the links provided by the executive branch, one quickly sees that two of the state’s assistance programs – the Maryland Small Business COVID-19 Emergency Relief Grant Fund and the Maryland Small Business COVID-19 Emergency Relief Loan Fund – stopped accepting applications on April 6, two days before the administration published its document list. So by the executive branch’s criteria, if a MoCo small business missed the state application window, which was only open for about two weeks, it is disqualified from seeking county assistance.

The county is requiring business assistance applicants to apply to these two state funds but both are shut down.

As for the federal assistance programs, the U.S. Small Business Administration (SBA) is under heavy criticism for not getting money out quickly. Some small businesses report that they have not heard anything from SBA after applying, not even a confirmation email. One of the SBA programs relies on private financial institutions to process applications, and some of them are either not taking applications or limiting them to existing clients. One community bank president even said, “What I thought was a brilliant plan is turning into a quagmire of quicksand.”

MoCo is insisting that its businesses jump down these bottomless state and federal rabbit holes to get county assistance. Again, this requirement simply does not appear in the legislation that the executive branch is charged with implementing.

So which businesses will be best able to navigate the process set up by the administration? Naturally, they will be the ones who are the most financially sophisticated, have the best accountants and have the most familiarity with government business assistance programs. Those who lack those assets – especially those with limited English language skills and less entrepreneurial experience – will be left behind. And so a county that prides itself on progressive values might actually wind up directing assistance disproportionately to the most privileged elements of the business community while the others will face extinction.

It’s not too late for the county to streamline its process. But it has to act fast. As in, NOW.

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Alsobrooks Brags About Beating MoCo

By Adam Pagnucco.

In a blast email sent today, Prince George’s County Executive Angela Alsobrooks bragged about a recent Washington Post story showing her county pulling ahead of Montgomery County in job creation. The email is reprinted below.

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Prince George’s Overtakes Montgomery as Top Job Creator in Maryland Suburbs

Dear Prince Georgians:

In case you missed it, an article published Monday in the Washington Post showed that our County has officially overtaken Montgomery County in terms of job creation for Maryland.

From 2013 to 2018, we added 21,236 jobs in our County, growing by 7.1%.  That growth secures our County’s spot as the top job creator for the entire State of Maryland.  I am Prince George’s Proud to say that these numbers confirm what we have been saying, which is that we are the economic engine for our State.

As the article states, our job growth is due in part to honest and effective political leadership in our County over the past several years.  In addition, our County has aggressively courted businesses by making key investments over several budget cycles.  We are not just waiting for businesses to come, but instead going out and beating the bushes to tell the story of Prince George’s.  These factors, plus the strong working relationship that we have with our colleagues on the County Council, have contributed to a very business-friendly environment in our County.

As we maintain the spot as the top job creator for the State of Maryland, we will not rest on our laurels.  Over the next several years, we plan to continue making investments to incentivize businesses to locate to Prince George’s County.  Some of our top priorities include high-quality dining and amenities, technology companies, and even federal government facilities that are looking to relocate.

We also plan to invest in creating what we call the Downtowns of Prince George’s.  These are areas where we will focus on mixed-use, transit-oriented development to continue attracting new businesses and growing our commercial tax base.  In the past year alone, we have seen several successes with these projects and the investments we have already made.

For example, in the area around the New Carrollton metro, Kaiser Permanente opened its new regional headquarters last year, and we learned that WMATA plans to move its regional headquarters there as well.  Construction will soon begin on the Carillon Project in Largo, which will revitalize the former Boulevard at Capital Centre.

Finally, we broke ground on the Hampton Park Project, which will replace the former Hampton Park Mall in Capitol Heights.  We’ve already secured several commitments from businesses to open in this location when construction is done, including the award-winning Ivy City Smokehouse restaurant and a Market Fresh Gourmet grocery store.

Those are just a few of the accomplishments we had in 2019 in terms of attracting new businesses and job creation.  You have my commitment that my administration will continue telling our story, making critical investments and attracting new businesses to create even more jobs over the next several years.

The best is truly yet to come for Prince George’s, and I know that by working together, we’ll have an even better story to tell in the coming months.

Yours in service,

Angela Alsobrooks

Prince George’s County Executive

Additional Coverage: The Economy is Booming in Prince George’s County

Following the Washington Post article, WJLA ran a story discussing the booming economy in Prince George’s County.  We have thousands of job openings in the County, and engineering firms like ATCS are excited to be here and hiring now. In case you missed the story from WJLA, watch it online by clicking here.

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Looking for the Next County Executive, Part II: The Future

The next county executive will face major challenges. Montgomery County’s economy is not performing well. While it’s a long-time cliché that we’re losing business to Northern Virginia—Ellen Sauerbrey campaigned on that theme in 1994—the County has not done well in creating new employment over the past several years.

Jobs, of course, are critical to success of county residents and also the tax base. Employment is the best social justice program ever invented. If the tax base stagnates, there will not be enough money to maintain the array of services for which Montgomery County is renowned, let alone spend more to lend people who need it a helping hand.

I’m hoping that whoever is elected county executive will have a forward-thinking plan for economic development. Though the newly launched Montgomery County Economic Development Corporation imitates the highly successful efforts of Howard and Fairfax to pursue business opportunities, I remain skeptical that it will achieve the same levels of success, as currently managed and structured.

We also need someone who is willing to break a few eggs and not see barriers as they launch more ambitious projects in a manner reminiscent of Doug Duncan. Even though they will not all work out, new ideas both for the County and how to organize County government to work better and more efficiently need to be tried or the County’s relative decline will start to feel a lot less genteel very soon.

The challenge will be especially great because tax increases are not a real option. Though we are now out of the recession, the income tax remains set at the charter limit. In 2016, the County Council achieved the unanimity required to increase property taxes significantly above the charter limit. Fees have also gone up for everything from recording property to public parking. The one area of tax opportunity may be making commercial development pay for improvements that clearly aid their own efforts.

While being inventive, the new county executive should maintain certain key policies of the Leggett Administration. In particular, the County must continue to adopt budgets and fund future obligations in a manner that retains its AAA bond rating. The County Executive also needs to focus on the core priorities of local government. Too often, the County Council has spent an inordinate amount of time on issues peripheral to core functions.

Finally, and perhaps most important in our era of seemingly toxic politics, we need someone who continues Ike’s outstanding record of listening respectfully to people who disagree, often vehemently, and is a model for civility in governance. That should be possible even as the new executive presses forward with new ideas and needed reforms.

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Contemplating Life Inside An Economic Engine

Political and business leaders often refer to Montgomery County as the “economic engine” of Maryland. Interesting words, “economic engine.”

In the 1950s and 1960s, Montgomery County was transforming from farmland to suburbia. I doubt that any of my neighbors in those years imagined that the county would ever be called an economic engine.

In 1950, the county population was 164,000. By 1970, population more than tripled, to 525,000. People were moving to Montgomery County by the thousands because it was a good, safe place to live, with excellent schools. And they could have a yard for the kids and the dog.

The fast pace of growth continued through the 1970s, 1980s and 1990s–not only residential development, but construction of shopping malls and industrial parks. The county became a place to work, as well as a place to live. Looking back on those decades, Montgomery County was an engine of constant real estate development.

By the turn of the century, Bethesda was on its way to becoming an “edge city,” with tall office and residential buildings. Cutting-edge industry emerged along the I-270 corridor in Rockville and Gaithersburg, and residential development extended to Germantown.

2014 And The Future

Now, in the year 2014, with a  population of one million, and more jobs than any other jurisdiction in Maryland, we’re not sure if Montgomery County is destined to be a city, a suburb, or something in between. Jobs are a critical concern, but housing is also essential, especially a range of affordable housing for everyone from retail and service workers, to teachers and police officers, to the very affluent.

Taking stock as we approach the 2014 election, and looking to the future, residents might ask the following question:

Do Montgomery County voters want to live inside a constantly growing economic engine?

My own instinctive answer is, “No, Montgomery residents want to preserve, as much as possible, a more bucolic, suburban sense of place.”

At the same time, I wonder, “Maybe we’re too far down the road to urbanization to turn back. We have more jobs than any other place in Maryland. Our population is diverse and multilingual. Wouldn’t it be cool to become a 21st century, cosmopolitan city.”

Imagine a prosperous urban center, combining the best of Montreal and Silicon Valley.

Montgomery County residents and leaders haven’t had much time to catch their breath and fully consider the choices. Growing from 165,000 to one million in six decades, it’s been a constant challenge just for basic infrastructure to keep up with population and job growth.

Past economic growth has been truly impressive, but we have no reason to project that kind of growth into the future. We can’t predict whether future development will overwhelm us, or go elsewhere.

For one thing, the federal government remains the most important economic influence in the Washington, D.C., region. If the federal government did not exist, Montgomery County would still be farmland.

The federal government remains the largest single employer in Montgomery County. But consider that federal job growth has probably peaked. Many workers in both public and private sectors will be replaced by computers and robots. We may well lose jobs faster than we can create them.

No matter what politicians say at election time, it’s not within the power of any one local leader, or even all local leaders acting together, to create private sector jobs.

If economic and job growth is Plan A, we should also have a Plan B. Plan A only works if the American economy returns to the status quo ante 2006. If not, if there’s been an economic paradigm shift, we’ll need a Plan B. What that plan would involve is beyond the scope of this article.

21st Century Infrastructure

Based on geography and infrastructure in the Maryland-D.C.-Virginia region, it looks to me like the economic engine of the future might be the I-95 corridor.

It’s shaped like a barbell, anchored in the south by the federal government and major universities in Washington. In the north it’s anchored by major universities and medical centers in Baltimore, and the Port of Baltimore. In between, along the highway and railroad infrastructure linking the two cities, there’s the University of Maryland at College Park, the National Security Agency at Fort Meade, and importantly, BWI Airport.

Now look west, to Montgomery County. The county is not far from the I-95 corridor, but it’s not exactly at the center of the action. You might almost say — in fact, I will say it — Montgomery County looks perfectly located to be a major bedroom community for the Baltimore-Washington corridor, particularly at the southern end.

Historically, major cities developed around transportation by water, railroad or airport. In the 21st century, can Montgomery County expect to be a major economic player without an airport? The county also does not have a professional sports team, or a major research university, a medical school, law school, or even a four-year college.

We’ve had our hands full in Montgomery County building a basic suburban infrastructure of schools, highways, and mass transit.

If we aspire to be a cosmopolitan center with population density and economic growth, we need to commit ourselves to building other kinds of infrastructure, such as a major airport and a university.

The growing Baltimore-Washington region is going to need another modern airport eventually, I’m thinking. Dulles is far to the southwest and BWI is to the north. Reagan National is reduced to boutique-VIP  airport status for obvious security reasons.

But finding a site for a major airport in Montgomery County is a problem that boggles the mind. It would be an epic battle. Possibly Frederick County would like an airport to support the economic growth of both counties. Or possibly not. All in all, an airport to serve the western part of the metro area seems like an unlikely dream.

Besides an airport, it’s hard to imagine a city of  one million, a center of innovation and scientific development, without a university. Lack of affordable, local higher education is a problem for both middle-class families and business development.

Montgomery College and the Universities at Shady Grove fill part of the need, but they’re less than a shadow of the excellent higher education available in Baltimore and Washington.

So what does Montgomery County have to attract businesses? A great public school system, relatively high costs of land, and inconvenient airport access. Seems to me the I-95 corridor might be a better choice for many companies.

Housing, Business and Jobs

It doesn’t make sense for jurisdictions within the region to compete for all types of development. No one can predict the future, but we’ll probably have more than enough growth to go around over the next 50 years. Might Montgomery add another half-million people? Another million? It’s impossible to say.

Since the pressures for growth are mostly beyond our control, wouldn’t it be best to allow the region to grow organically, rather than trying to rush growth, or block it?

Maybe the I-95 corridor has an advantage when it comes to development of business and commerce. Maybe Montgomery County has an advantage as an excellent place to live.

When good companies want to locate in Montgomery County, we should welcome them. But it doesn’t make sense to encourage growth on steroids, or to get into a bidding war with other counties.

Jobs are a critical need, but so is housing. The exact location of jobs is not critical, as long as they’re within commuting distance. Montgomery residents moved here because they want a good place to live and excellent schools. They knew from the start that they’d be commuting. They don’t necessarily need their jobs to be in the county.

Fortunately, the Intercounty Connector and the Purple Line will connect Montgomery County with the I-95 corridor in both north and south. The improved transportation network will make it easier for people who live in Montgomery to get to jobs in Prince George’s, Anne Arundel, and Baltimore, and vice versa. No need to treat our neighbors as rivals. A cooperative approach would enable the region to grow organically, with a balance of businesses for people to work in, and houses for people to live in. It’s a win-win.

Election year 2014 is an opportunity for decision-making. We only get this opportunity once every four years. But I’m afraid most residents are disengaged from politics.

Assuming that continued growth is virtually inevitable, the question is:  What kind of growth and development do the people who live and vote in Montgomery County prefer, and how much? And what do the candidates think?

Is Montgomery County home sweet home, or an economic engine. Perhaps it can be both. What do you think.

Contact: BJohnHayden@icloud.com

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